Amazon sells Kindle devices at cost in order to push digital content

[Master Devwi]

Speaking to the BBC, Amazon Chief Executive Officer Jeff Bezos revealed that the online retailing giant doesn’t make a profit on sales of its inexpensive and wildly popular Kindle devices. Of course, this isn’t much of a surprise, given Amazon’s business strategy.

From a sales perspective, Amazon’s Kindle and Kindle Paperwhite devices are nothing more than storefronts for Amazon’s Kindle eBook bookstore. The Kindle Fire and new Kindle Fire HD take this strategy a step further, pushing content from all of the company’s digital media services like Amazon Instant Video, Amazon MP3, Kindle, Audible, and the Amazon Appstore for Android. This is where Amazon makes the real money, so by selling Kindle devices at cost, the retailer is only making it that much easier for customers to get their hands on Amazon’s content.

Do you think Google is pursuing the same strategy with the similar Nexus 7 tablet?

[BBC via Gizmodo]

[CrowdAds]

[Syndrome]

They might make more money selling the kindle fire hd as a normal android tablet. I personally couldn't stand the amazon aspect of it.. I returned it within a few days and ended up with a samsung galaxy tab 2, at least it is expandable.

[Jeven]

Pretty much every serious review of the Kindle HD concludes that it's garbage and you have to wade through so much Amazon rubbish.

[WalkGood]

“Amazon sells Kindle devices at cost in order to push digital content”

This is nothing new, mobile network providers have been selling handsets below cost for over 20 years w/service contract. It makes sense, sell the hardware at cost or below and make the profit on the service/content. Although in the case of the tablet, once someone hacks it you don’t need their content exclusively.

[Marvin the Martian]

Originally Posted by WalkGood

“Amazon sells Kindle devices at cost in order to push digital content”

This is nothing new, mobile network providers have been selling handsets below cost for over 20 years w/service contract. It makes sense, sell the hardware at cost or below and make the profit on the service/content. Although in the case of the tablet, once someone hacks it you don’t need their content exclusively.

Even then, it is still a fail without memory expansion , since it doesn't have much internal memory....unless you use the cloud, which I sure don't....lol.

[WalkGood]

Originally Posted by Marvin the Martian

Even then, it is still a fail without memory expansion , since it doesn't have much internal memory....unless you use the cloud, which I sure don't....lol.

I was only addressing the quote “Amazon sells Kindle devices at cost in order to push digital content.” Personally I don't have a need for a tablet, I prefer a real keyboard and f**k the cloud

[bikertrash]

I like my Kindle and I think it's great. It is closed but it's cheap to so I don't mind. I buy a lot off of Amazon and I think it's great watching how they shake up the low end of the Tablet market. For $150.00 I wouldn't think twice about getting the base model Fire if I was into tablets, just not into those.