Amazon took the books market by storm with the Kindle. They jumped into the transition at the right time and as people shifted from physical books to ebooks, Amazon had them! As physical book stores come to an end, Amazon proudly sells more ebooks than physical books, cheaper, easier and faster. The consumption platform remains their own Kindle hardware lineup which has shaped up well over the years. I was amazed at the service Amazon provides behind the Kindle hardware. They would even replace for broken displays. It was always clear that they wanted to sell content for profits and not the hardware.
There were debates before if Amazon Kindle Fire was sold at a loss? The $199 tablet from Amazon was a rage. Small, beautiful interface and cheap. On the other hand the regular Kindles kept getting cheaper and cheaper. So is Amazon really selling its hardware for a loss?
Apple iPad, Google’s Nexus 7 and a plethora of Android tablets are out there. Many struggling to sell in enough numbers and make money. Giants like HP have sweated it out with no results and here comes the Kindle Fire that is the best seller after Apple’s iPad. So what is Amazons game? Well hearing it right from Amazon CEO Jeff Bezos, Kindle is sold at cost. There, he said it.
Given the heavy Amazon integration and content focus, Amazon expects to make money from selling content on the Kindle hardware. This is much like what Google does, by giving away Android for free and making money from services and very different from what Apple does by making bulk of money selling hardware and peanuts compared to that on content. Given that, can Amazon really disrupt both Google’s Android and Apple’s iPad with the Kindle?