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At a high-profile Sept. 28 event in New York City, Amazon unveiled its $199.99 Kindle Fire tablet, a 7-inch device with streamlined access to the online retailer’s multimedia and cloud content.
Within a day, it seems, prominent retailer Best Buy started slashing the price of another 7-inch tablet, the BlackBerry-branded PlayBook, by $200. Nor is that price cut tied to any sort of promotional deal or mail-in rebate.
Coincidence? Certainly the Kindle Fire is expected to have a sizable impact on the tablet market, given Amazon’s significant promotional muscle. And it’s no secret that Research In Motion wanted the PlayBook to perform better in the open market. During the company’s Sept. 15 earnings call, RIM co-CEO Mike Lazaridis told media and analysts that sales of the tablet were “below where we’d like it to be,” but that the device would “ultimately be successful in a market that’s in its infancy.”
Whether Best Buy’s price cuts become the norm for the PlayBook remains to be seen, although retailers generally aren’t slow when it comes to slashing prices to match the competition. On Amazon, the 16GB PlayBook is yours for $350.
The Kindle Fire’s sticker price significantly undercuts those of other tablets on the market. Although RIM has positioned the PlayBook as more of an enterprise device, it’s already being positioned as a head-to-head competitor with the Fire by virtue of the shared 7-inch form-factor.
The PlayBook isn’t the only tablet potentially at risk from a bestselling Kindle Fire. Amazon’s tablet could pressure other Android tablet manufacturers to raise their own game, with more robust multimedia offerings and perhaps different “skins” on the basic Android interface. Samsung has already taken steps in this direction with its TouchWiz interface and media hub.
The big target is Apple’s iPad. For many months, Apple has handily dominated the tablet market. Every successive “iPad killer” failed to reverse or blunt its blockbuster sales trend. Now Amazon’s tablet will debut in November a radically lower price point, loaded with a full array of goods and services, and backed by the same smart, aggressive marketing efforts that turned the Kindle into the e-reader market’s dominant device.
Some pundits argue that the iPad is a device in a wholly different category from Amazon’s offering, and that the tablet ecosystem is large enough to accommodate both those users who want an ultra-portable computing platform (iPad) as well as a multimedia peripheral (Kindle Fire). Time will tell whether this assertion proves correct, or if the two company’s tablets end up battling for the same wallets.