Amazon Tablet

Just pre-ordered one for Anne for her Birthday (the 17th). If I don't get one in return (mines the 15th) I'm taking hers when I get back.

Some news:

However, Amazon is making a pretty big gamble on this:

Personally I think Amazon planned for this and will weather the storm. Just like Microsoft planned to lose money on the original XBox in order to break into that market, I think Amazon planned on losing money (even including content sales) on this to get it's foot in the door when it comes to tablets.

Their model is definitely different than Apple's. I don't see a reason that both cannot function well at the same time as they appeal to different client demographics.

Making money on volume is a difficult business proposition especially in today's business environment. The old saying goes that you can pick two out of the following three qualities when dealing with the company: quality, service, or price.

I have had two businesses in the last three years and start up phase. First business, I tried this on price. What I found was that customers who paid a little expected customer service that could only be offered at higher price levels.

I can do far has the advantage of being offered on a very stable platform, but Amazon is getting out of the realm of a very simple device (the Kindle) as they move into the realm of the tablet market.

I also question whether people who are attracted to a low-priced device will be willing to fork out a lot of money for purchases on said device. To me, this seems counter intuitive. One could go so far as to say that Amazon is seeing what they want to about this market segment.

For example, say that I was a corporation looking to take advantage of a huge tax windfall for hiring people imprisoned for a specific crime. Embezzlement or any other financial crime will do for the sake of those poor example. The tax benefit might be $50,000, but making such a high level hire exposes the company to millions in losses should this person return to their past behavior.

So what is the past behavior of people potentially using this product? They want free apps and free content. This is the classic. Android versus IOS debate. This is the reason that developers love to develop for IOS, and then go to other devices. I wish users are willing to pay for good apps whereas android apps are typically paid for through high volume, low profit advertising. Are there exceptions to this? Yes, but one thing that I follow is surveys about developing ecosystems.

One of my good friends works with start ups and established development companies to source good development talent. In his experience, profitable companies do not develop android.

Unless Amazon can find a third way, do not believe that this tablet has potential to self as much content as they think. They have a lot of people working for them who are smarter than I am and I actualy hope that I'm wrong as I believe that innovation and competition drive product excellent.

One thing: they're not as stupid as Netflix.

Prime Membership also gets you unlimited free two day shipping.

I wonder how long until Amazon starts really going after Netflix. After the complete cockup over splitting the service you'd think the timing would be perfect.

I'd like to see Amazon become competitive with Red Box. Why should it cost $3.99 to stream the same movie that I can rent the DVD version for $1.20? I currently have the Fire on pre-order, but I'm reconsidering. Do I really want or need what amounts to a Cruz tablet without a memory card expansion slot?

Netflix will be fine. They can go to a pure streaming based business at any time and they'll still be making money. They would obviously shrink significantly if they did it right now but they're not dead by any means.

I don't know. It's not looking good for them:

http://www.zerohedge.com/contributed/netflix-hell-has-no-fury-subscribers-scorned

Netflix stock has plummeted 75% since July. There were already talks of acquisitions (in the Seattle info I read, I've heard both Amazon and Microsoft), if it can stem it's subscriber hemorrhaging that is looking more and likely. If only for the content deals it's already locked in.

Figures they'd go tits-up as soon as I subscribe.

Any other consumer businesses y'all want killed? My services go to the highest bidder.

I'll stick with them until they fall provided they are still able to give me plenty of content to stream. If they get bought by MS or Amazon I'll obviously move over to whichever service has the most streaming content for my money.

They have 9.9 million streaming only customers right now. They lost 800,000 subscribers so far, I don't remember what they were charging before for the dvd/streaming service but I think it was $10 a month. If that is accurate they lost 10/month for 800,000 people, while gaining $6 a month on the remaining customers. They have 13.4 million other customers (not counting the 9.9M that stream only because their rate didn't change) that accepted the $6 rate hike. So they lost 8,000,000 per month to gain 6x13.4M = 80.4 Million per month.

Even if they do lose all 3.63M customers the $66.2M(remaining once you pull out another 2.8Mx6) outweighs the $36.3M lost and that isn't even counting the 52K new streaming subscribers at $8 each per month.

Bad publicity, sure, good move, yep. Yes their stock tanked but it will recover. They beat their earnings estimate and if they continue to do so they will watch their stock go back up to about $300 a share over the next year.

The biggest bonehead move by their management was buying back a bunch of shares of stock at a weighted average of $230 a share a few months ago. That is only a good move if you know your stock is going to spike or you really need more control back of your company. I don't know what made them think their stock was going to go up when they were about to make a move that was going to get all sorts of bad publicity. Basically they threw away $150 per share on however many shares they bought back.

Forbes say the stock should be at $142 right now.

I just wish they would get more movies and TV shows to stream.

You neglect the fact that the people they lose are the high margin customers. Profits per customer are not nearly uniform. The [-]suckers[/-] customers who subscribe and who order a DVD once every few months are the ones they lose first. Netflix didn't lose the customers whose postal charges exceed their membership fees and who stream a movie every night.

Netflix is doomed in the long term for much the same reason that brick and mortar rental stores are dying.

Because streaming is dead? Seriously though, how do you figure? I suppose in the really long run all businesses are doomed. Netflix could just move to a streaming only model if it came down to it. Yes they would make significantly less money but they would still make money.

The thing that will eventually kill them is that they do not create the content. They are a middle man and the studios could theoretically just decide to stream the content themselves.

Less than two weeks till the release.


Today I had an email from Amazon talking about their New Amazon Fresh App:

When you click the link:
https://fresh.amazon.com/Category?cat=mobile&ref_=pe_159590_21665510
it turns out that the Android App has the most features:

That's what I am talking about, brick and mortar rentals are dying out because they add an extra unnecessary step between the customer and the producers of the media.

O rly?

Amazon Fresh has been around for years. I looked at it back when I lived in Bellevue. To make the prices work out you really need to put stuff in for regular delivery (you get a discount).

What I've been trying to figure out was what exactly Amazon was going to DO with it. They've been test marketing it for forever. You'd think they'd either say 'okay it's a success here, now we'll try it in X, Y, and X markets' or 'well that didn't work, let's shut 'er down.' But instead it's just sitting there plugging along in the Seattle market (I have no idea if it was profitable or not). I wonder if they've been keeping it going to see how it works with the Fire, and then take it national.

So Amazon has really been beefing up Prime recently, yesterday announcing a free Kindle book Lending Library for Prime members.

Now I knew that the reason for this was that once people had shelled out for the 'free shipping' they felt they needed to buy more to 'get their money's worth' and that they did in fact buy more. What I didn't realize was how much.

http://www.fastcompany.com/magazine/160/why-amazon-will-win



The Kindle Fire will come with a (3 month I believe) free trial of Prime. Shit, if those numbers above are correct those three months alone might offset the lose they take on a Fire.

Amazon: Kindle Fire will come with Hulu Plus, ESPN and Newsstand.

I think the success of prime is tied to a limited usage of it. At some point, shipping costs would undo it - it isnt a Costco membership, after all.


Hmmm. Prime + Costco = existing distribution points.

My Kindle Fire shipped yesterday!

Is it coming out of Indy? That's where Anne's is shipping from. Left out of there at 4:12am.

Looks like mine shipped from Nashville, TN at 12:09 yesterday and as of 07:49 today it's in Leetsdale, PA.

I live in Canada but I'm having it sent to a mail drop in Niagara Falls, NY because Amazon won't ship the Kindle Fire to Canada.

Huh, looking at the full history it appears to be coming out of SC.

November 15, 2011 05:45:00 AM Seattle WA US Arrival Scan
November 15, 2011 04:12:00 AM Indianapolis IN US Departure Scan
November 15, 2011 12:32:00 AM Indianapolis IN US Arrival Scan
November 14, 2011 09:05:00 PM West Columbia SC US Departure Scan
November 14, 2011 12:29:00 PM West Columbia SC US Shipment received by carrier
November 14, 2011 10:25:59 PM --- Shipment has left seller facility and is in transit


Which is funny considering it likely came out of Asia on a cargo ship to some West Coast port, took rail across the entire US and then is being flown back across.

Eh, a lot of containers I've gotten shipped come to Savannah.

Of course, no one is smart enough to put container ships up the Mississippi to Memphis, it seems. :/

Well Anne got her's the morning of the 15th and even though her birthday isn't until today went a head and opened it.

So far she is loving it.


I'm reading online and it's getting mixed reviews. I'm noticing a couple of trends:

1) It doesn't have all the features of the iPad. Uh... no shit. People were pointing this out and saying it wouldn't sell when the Fire was first announced. So far they were wrong. I don't really think this device is designed to compete with the iPad, the idea is grab people who want a tablet but not enough/don't have the money to buy an iPad.

2) Not enough Apps, what apps are there were designed for phones and don't really utilize the Fire's capabilities. This seems pretty legit. Although I'm sure once the presale numbers started being leaked people started developing Apps for it. Hopefully it won't take too long for these to start coming online.

3) Screen size. Magazines and Newspapers don't read as easy on the Kindle as they do on the iPad. This also seems pretty legit. Some this can be alleviated by better apps and readers but a small screen will always be.... smaller than a large. We'll have to see if Amazon or Newsstand is able to overcome this.

4) Silk not all it was meant to be. Apparently it is not as fast as projected. Could be just be opening day jitters that get worked out as we go along.


Some reviewers have pointed out that the original Kindle was panned for being underfeatured, but have managed to do quite well. We'll have to wait and see what the consumer thinks once Fire's start getting out on the floor and people can get their hand's on it.