Amazon Kindle Fire with $199 Price Tag Puts Pressure on Android and RIM

September 29, 2011, By Sanjeev Ramachandran

There has been so much talk as to whether or not the Amazon Kindle Fire is the iPad killer. The tablet’s pricing at $199 is definitely as attractive for the customers as it is a headache for other tablet manufacturers.

It is not just the iPad that will feel the pressure, if you go by analystspeak and a cost analysis report.

Analyst at Rodman & Renshaw Ashok Kumar told CNET that the Kindle establishes a new price point for the low to mid-range tablet and that Apple will likely have to respond.

And here is what a report from UMB TechInsights, which show the Kindle Fire’s bill of materials at $150, says: Amazon will make a profit on hardware sales of its Kindle Fire, but probably only a third to a quarter as much as Apple iPad and the BlackBerry PlayBook.

The Android tablet manufacturers are definitely in a tight spot now; if they want to compete with Kindle Fire’s price they would have to put their tablets at or below cost. Also, while Kindle has Amazon’s storefront to make up for any loss, the others manufacturers do not have that kind of advantage, it has been noted.

RIM is facing the heat as well, there have been dramatic cutbacks in the production of PlayBook because it s not selling at current prices, according to Kumar. The Kindle Fire looks similar to the PlayBook and also uses the same or similar TI dual core processor.

Amazon’s tablet does not have the high resolution cameras like the PlayBook. But the price is far more attractive than two cameras for the customers.

Let’s see if Apple will stick on to the price of iPad after Kindle Fire.

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