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If Amazon is actually selling the Fire for a loss, how is that a "surprise"? Amazon isn't a hardware company. Its hardware is all about building a delivery infr
by jonnathanson 15y ago
If Amazon is actually selling the Fire for a loss, how is that a "surprise"? Amazon isn't a hardware company. Its hardware is all about building a delivery infrastructure for its content sales: books, movies, TV, music, etc. (This is sort of like Apple in reverse; Apple uses content to sell hardware).
Obviously Amazon expects to monetize the heck out of each Kindle customer, over a lengthy user lifetime, on content sales to the Kindle. So building a Kindle userbase through cheap, subsidized Kindles is a no brainer.
The Fire isn't competing with the iPad; it's competing with Netflix. To that end, I am a bit surprised to see a Netflix app on the Fire. At the same time, Amazon probably realized that millions of Netflix customers would need the Netflix app in order to justify using the Fire as a media tablet. Once they've got the customers using Netflix on the Fire, they'll try to find a way to make their media downloads more attractive and less cumbersome than the Netflix app.