Amazon took the wraps off its newest Kindle on Wednesday, and the Kindle Fire is less of an e-reader and it's more like a tablet.
It's only available in the U.S. for now, where it will cost just $200, less than half the cost of the cheapest iPad.
Now Amazon's other Kindles have black-and-white E-Ink screens,
while this has a color touch screen, making this the first Kindle that can handle movies.
And if you want to see how Amazon is geared up to support the Fire's media playing capabilities, take a look at this.
This is Amazon's homepage. And right here, you'll notice that the first five items are all digital media, from streaming videos to e-books to apps;
all five are accessible with the Kindle Fire.
And it's only underneath that you get to the physical products that Amazon sells, like the books, the toys, or clothes.
Now, let's take a closer look now at Amazon's strategy with the Kindle Fire.
I'm joined by our regular contributor here on News Stream, Nick Thompson from The New Yorker.
Nick, good to see you.
Good morning.
And is the Kindle Fire a sign that Amazon is turning into a retailer of digital goods?
Absolutely. They see that there's this transitioning happening.
It's a transition that's been going on for a while, but it's happening much faster now, and they are absolutely making a commitment to it.
One thing that's very interesting is they're selling the Kindle Fire almost certainly at a loss.
And they're selling it so that people will buy the Fires for $200 and then start using Amazon services
-- like downloading music, like watching videos, --
and then they'll get used to doing all those things on Amazon, and those are things they're going to be doing for a long, long time.
And they're very profitable.
If you can sell someone a downloaded song, you can make a lot of money.
So, Amazon is going to lose a little bit of money now in order to get a lot of money later.
Now Nick, let's look at some of the Fire's key specs. They're all over the screen here.
I mean, for example, it has a seven-inch screen, eight gigabytes of storage.
It can access some Android apps through the Amazon app store, but the key -- it's just $200.
So Nick, as a media consumer, why would I pick the Kindle Fire over the iPad?
Well, the iPad has a few things that the Fire doesn't have. It has a camera. It has GPS. It has larger storage.
But the Fire, at 40 percent of the price, is a great deal.
And if you like Amazon's services and you already have an Amazon account and you can use the Amazon store...
remember, the Amazon store is much better than the iTunes store for finding things. It has much more data and much better recommendations.
The other cool thing about the Fire is they made a lot of content deals right at the start.
It took the other tablets a while to start working with publishers of all kinds.
So, the Fire comes immediately with all kinds of, you know, obviously all the movies, but also all sorts of magazines.
My parent company for example, Conde Nast, is available right on the Fire immediately.
The New Yorker, where I work -- my favorite magazine -- has a... you know, a version of The New Yorker with, you know, entirely customized for the Fire right at the beginning.
So, there's a lot of stuff you want right now.