Kindle Fire and PaperWhite sales make zero profit for Amazon

Amazon has said that their latest Tablet, the Kindle Fire HD, and its latest E-Reader makes the company no profit at all. Chief executive Jeff Bezos told the BBC “We sell the hardware at our cost, so it is break-even on the hardware”. Like the Google’s Nexus 7, which is sold to near enough the same as its production costs, they hope its users spend money in the Play Store, which Amazon hopes their consumers will do with their own app store and other store fronts.

The new E-Reader by Amazon, is directly aimed at the Barnes & Noble Nook readers, which use  a back light to create the paper white look. Amazon is also promoting its new subscription package that has access to its Kindle owner’s lending library. The service offers users the ability to borrow up to one book a month from a selection of titles including well known authors – such as JK Rowling  and writers who have published their works through Amazon’s own publishing system. The UK service will have over 200,000 E-Books at launch.

Amazon will start delivering the new Kindle Paperwhite on October 25th around Europe, also with its Kindle Fire HD Tablets. “We want to make money when people use our devices, not when people buy our devices,”  Jeff Bezos told the BBC.

Whether this system will work for Amazon, their E-reader devices have the best ecosystem, and now have started to gain users of its App store, which provides Android applications to its Kindle Fire Range.  With new tablets being released this fall, such as the rumored  32GB Nexus  7, £99 Nexus 7, and the ever growing iPad mini rumors, Amazon has got big competition in the tablet world.

Source - http://www.bbc.co.uk/news/technology-19907546

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One response to “Kindle Fire and PaperWhite sales make zero profit for Amazon

  1. Pingback: Amazon Kindle Fire 7 Inch HD: I got one and I love it « Serendipity·

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