Amazon’s unveiling of the Kindle Fire, a tablet computer that costs a few hundred dollars less than Apple’s iPad, sends a bright-hot message: The online retailer is ready to rival Apple in an effort to be the world’s top provider of digital content.
It might sound odd coming from a company that pioneered online sales of physical books in 1995. But since it first entered the digital market in 2006 with its video download store, Amazon has bet consumers will pay for high-quality digital content.
Besides the millions of physical items it sells, Amazon’s trove of digital content now includes more than 1 million eBooks, 100,000 movies and TV shows, and 17 million songs. This is about 1 million fewer songs than iPad maker Apple Inc. sells, but more than twice as many eBooks and many thousands more TV shows and movies.
Amazon.com Inc. CEO Jeff Bezos is confident that its content is what will help the Kindle Fire do better than others who have trotted out tablets.
“The reason they haven’t been successful is because they made tablets. They didn’t make services,” Bezos said in an interview after his company unveiled the tablet at a New York media event Sept. 28.
The price will probably help, too: When it goes on sale Nov. 15, it will cost $199, which is less than half of the $499 you’ll pay for Apple’s cheapest iPad and $50 less than book seller Barnes & Noble Inc.’s Nook Color eReader. This leaves buyers with plenty of money left over to spend on content.
“It’s important to remember at the end of the day that Amazon’s core business is retailing, and this is a way to sell more digital media on a sort of 7-inch vending machine,” NPD Group analyst Ross Rubin said.
Bezos, a 47-year-old former Wall Street money manager, started Amazon on the theory that a web-based bookstore would resonate with consumers, because it seemed like the easiest way to browse millions of titles at once.