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Amazon’s New Tablet Overshadows Better Bargains

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Amazon’s new Kindle Fire may be big iPad competition, but it’s the new cheap Kindle e-readers that are the real bargain.

Amazon’s tablet announcement today could have far-reaching implications for your gadget use.

The $199 “Kindle Fire” tablet is less than half the starting price of an iPad 2 and boasts Wi-Fi, Flash video and access to Android apps and games — as well as all the movies, books, songs and other digital content Amazon sells. Lest that make the old $114 Kindle look overpriced, Amazon replaced it with three new e-reader models, the cheapest of which is just $79.

It’s the e-readers that are likely to make the bigger impact.

“This changes the e-book reader into a commodity item,” says Michael Gartenberg, an analyst at research firm Gartner Inc. The $99 Kindle Touch is $40 cheaper than Barnes & Noble’s competing Nook, and the $79 Kindle might attract more consumers who hadn’t previously been interested in buying an e-reader, he says. As we reported earlier this month, Amazon has reportedly also been working on a deal to provide a library of free e-books as a perk for Amazon Prime subscribers. (The $79 annual fee currently comes with free two-day shipping and free access to of the site’s growing roster of movies and TV shows for streaming.)

But is the Kindle Fire an iPad competitor? Maybe, experts say. Apple devotees aren’t likely to budge, but the low price point and features make it a contender to lead the Android market, Gartenberg says. Investment blogger Andy Nyquist says the Kindle Fire could at the very least shift iPad pricing. “Amazon’s marketing machine and online retail presence may pose a bigger threat to the iPad2 than the device itself,” he says. (Apple and Amazon did not respond to requests for comment.)

Pay Dirt readers, are you tempted by any of the new Kindles?


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  • Pay Dirt examines the millions of consumer decisions Americans make every day: What to buy, how much to pay, whether to rave or complain. Lead written by Quentin Fottrell, the blog examines these interactions, providing readers with news, insight and tips on shopping, spending, customer service, and companies that do right – and wrong – by their customers. Send items, questions and comments to or tweet @SMPayDirt.