1. It was the only tab available for a while but there are many others now. But I'm not of the belief that even brainwashed Jobsian cult members buy something just because it's available. There may be 300 million people in the U.S. but what's the actual market for tabs? Maybe 25 to 30 million, if that. It sold 2 million of the 1st gen model in the first few weeks so the numbers now will be much, much higher. 1 million of the 2nd gen units sold in the first weekend of availability.
2. There's a whole sub-industry building of photography and videography on mobile devices. There are an increasing number of apps available for editing video. Vimeo is even co-sponsoring a 'film-fest' of videos shot on mobile devices. This one has no camera(s). Is it a fad? Maybe. But initially a LOT of people said video in DSLRs would never take off either. Oh how wrong they were.
3. For what you've spent on the Fire now you could have bought a more fully featured tab and still had money left over.
4. Sorry, I think I misunderstood what you were saying. I thought you were saying there was a $25 profit margin built into each unit, not a loss. So let's take the middle point at $25 (between the $50 and $10) I mentioned before as somewhat accurate. If the other estimate of a $10 profit from content is included, that still leaves a $5 loss per unit ($10 loss on unit + $20 profit on content = $10 net profit). Not an overly smart business strategy.
4.5. I guess I have more faith in people (I can't believe I'm actually saying that :-o ).
1. It is a good point that the market has already been saturated. But only to a point. There are many who haven't yet purchased and the first day figures of 95,000 pre-orders shows the market is strong for this level of device. I think (and Bezo obviously agrees) there are a large number of potential tablet buyers waiting for a lower price point. Any current business/economic theory will support this. The only question is at what price point will the most people jump in. Often companies know they can sell x number of units at a high price, so they do this their first year. They know when they do this that the market will saturate and they'll need to lower the price to sell more units at a lower profit margin.. so they do this the next year. This is a standard business model most companies use..
2. There is.. and the mobile phone market has this sewed up. There is little to be gained by having this type of camera on a tablet as Apple has found out. A tablet is just too big and inconvenient to use as a capture device. But there is a limited market for those who video chat in one form or the other, about the same percentage as there is for laptops. Very few have ever debited a laptop for not having built in cameras, unless it's a model aimed squarely as multi-media home use.. and this is usually a low end market.
3. Sure, but now I'll have 3 devices. I'm envisioning one for personal reading/viewing, and two I'll root. One hopefully will control my wireless Quantums even if I have to write it myself.. and the other as a field capture device, time lapse, focus bracketing, etc.. This last one is a bit risky, while I can write the light control software myself because it's very basic, I'm not capable to do the other. So I'm guessing others will. Or will soon. If not, I'll find a use for a capable $199 tablet.. easy to do. For me a 10 inch Ipad is bigger than I want for stuffing in my bags, but not big enough to do real work on.. I'm not a fan of a 10 inch in any format.
4. If the business strategy was to make a profit ONLY on hardware sales then I'd agree. But it's not. It actually becomes an extremely cost effective advertising tool. Think about it, how much money do you think you could make if you could somehow get people to carry around a mini-billboard that you could program to feature anything you wanted, as often as you wanted? Would you pay people $25 to carry this around? Amazon will, and it's absolutely brilliant.
4.5. Faith in people is a good thing. But when it comes to awareness outside their own country, especially with American's, I just can't bring myself to be optimistic. Heck, Amazon isn't just making money on operating systems like Windows, or hardware like Ipads, or service plans like AT&T.. they've positioned themselves to get a piece of all that, plus most everything sold retail, all sorts of intellectual property, new cloud technology, you name it.. they're getting a piece of it. And they're doing it globally. And because they're not controlling a specific industry there can't be a monopoly or anti-trust issue. They're just getting their small slice of everything. The mafia business model..
From a business standpoint this is a tremendous achievement. To pull off what the mafia has been trying to do since time began, but to do it legally.. and with voluntary, happy, and satisfied customers. The true scope of which, is only limited by Bezo's obviously huge imagination.. Impressive. And on top of this, everything they're doing provides a better value to masses.. a sort of retail social equalizer. There are no losers. Well, except maybe a few states who think they should get their share through taxes, but they've been handling this issue well.