May 07, 2012

What does the crash in Kindle Fire sales say about the tablet market?

The Kindle Fire sold like hotcakes when it came out last year. All the sales reports I have seen for the 1st quarter of 2012 show a huge drop-off in sales down to 750,000 units from the 4.8 million sold the last quarter of 2011. Target is even dropping the Kindle Fire from it's stores. What does this tell us? Is the low-end tablet market a passing fad and that there is limited demand for a device that is not quite a laptop, not quite a smart phone. Or that you have to drop $500+ to get a tablet worth owning?

I suspect that part of the Fire's problem is that Apple is now selling iPad 2's at a reduced price. Those wanting to buy tablets are probably gravitating toward the iPad 2 instead of the Kindle fire. Or, if they want a higher end tablet, they are going for the iPad 3.

I thought about getting a Fire, but I already had an iPad 1. I've since upgraded to an iPad 3 and couldn't be happier with it.

It tells me that a limited capability product has limited appeal.  It also suggest that the Kindle Fire is more desirable as a gift to give than a purchase for oneself.  Windows Phone gets grief for lack of apps, but think about Kindle Fire owners - they don't have access to an App Store/Google Play with the hundreds of thousands of apps to choose from the way purchasers of full feature, more capable tables do.  Sure, they have apps available from Amazon, but not the entire package that most "sophisticated" potential buyers have gotten used to with their Androids and iPhones.  Personally, I wouldn't mind having a Fire, it would be nice as an e-reader with some bonus features thrown in, but I can't see myself dropping $200 when I can't effectively use it for work, which is where most of my waking hours are spent.  Maybe someone will give me one as a birthday present, though.  

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