5 reasons to buy Amazon’s $50 tablet — and one not to

18 Sep 2015 | Author: | No comments yet »

Amazon expands Fire range with new low-cost devices.

San Francisco – Amazon unveiled a major home electronics push on Thursday, led by a $50 tablet computer and other devices aimed at budget-conscious, gadget-hungry consumers. The low-cost, seven-inch (18cm) Fire tablet is part of an upgraded line being launched by the online retail giant, along with updated Fire TV streaming media devices and a new game controller box.

The 7-inch Fire tablet unveiled Thursday marks Amazon’s most aggressive attempt yet to undercut Apple, which has been the market leader since its first iPad went on sale five years ago. The new Fire tablet, one of several new and upgraded devices from Amazon, comes with a screen that measures 7 inches (17 cm) diagonally and a front-and-back camera. Amazon, which appeared to stop sales of its Fire Phone earlier this month after a lacklustre response, is making an aggressive push into the living room at the low end of the electronics market as rival Apple launches its high-end tablets and phones. “Today, we’re taking another step in our mission to deliver premium products at non-premium prices,” Amazon founder and chief executive Jeff Bezos said in unveiling the new tablet.

Analysts state that the company will not earn profits from the devices themselves, but are luring more users toward their recurring, paid-for premium content offerings such as Amazon Prime. It will start shipping on Sept. 30. “There’s one part of the tablet (market) that’s growing right now, and … that’s sub-$100 tablets,” said Dave Limp, senior vice president of Amazon devices. The low-cost tablet, which will operate on the newest version of the Fire OS operating system based on Android, “sets a new bar for what customers should expect from a low cost tablet.” Amazon has built a reputation for selling at low profit margins to build customer loyalty, and getting consumers into its ecosystem for shopping, music, online video and other services. -Amazon, being as it is primarily concerned with selling and delivering content, is clearly positioning this device as an entry point to its paid-for services such as its $99-a-year Amazon Prime. The Seattle company is counting on the new tablet’s low price to encourage more people to buy a device and, in the process, buy more merchandise from its store.

Amazon is also launching a new 8.1-inch Fire HD tablet at $149 and a 10-inch device at $229 – less than half the price of Apple’s latest comparably sized iPads. Analysts said Amazon is unlikely to make a profit on the $50 tablet, and may even lose money on the device, but will use it to lure more consumers into the Amazon orbit. “It does appear this falls into the philosophy of getting people onto the Amazon platform to make money selling them music and movies and books,” said Avi Greengart, analyst at the research firm Current Analysis. The company has said it does not plan to profit from devices but wants to use them to draw more customers to its services. “They’re out of the phone business,” said Tim Bajarin, president of San Jose-based tech research firm Creative Strategies. “To be fair that was a true mistake. Amazon said viewers could soon control home appliances through Fire TV, a function available on Echo, the company’s personal aide gadget that can regulate thermostats and lights.

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