Tablet battle heats up

30 November 2011

NEW YORK: Competition appears to be intensifying in the tablet market as Amazon's Kindle Fire gets off to a strong start, although it still remains some way behind Apple's pioneering iPad.

Amazon reported that it had sold "millions" of units of the Kindle Fire slate and Kindle e-book reader before Black Friday, and added that total unit sales on that day were four times greater than the previous year.

"[The] Kindle Fire was the bestselling product across all of," said Dave Limp, vice president for the Amazon Kindle. "In addition, we're seeing a lot of customers buying multiple Kindles - one for themselves and others as gifts."

While Amazon did not release actual sales figures for the device, anecdotal evidence from leading retailers suggests competition is rapidly intensifying.

"This was a great Black Friday for Target and for Kindle Fire, which was the bestselling tablet in our stores on Black Friday," Nik Nayar, vice president, merchandising, at Target said.

Wendy Fritz, Best Buy's SVP, computing, tablets and e-readers, proved similarly optimistic, arguing: "If this Black Friday was any indication, they are only getting hotter as we get into the shopping season."

Forrester Research predicted that purchase levels for the Kindle Fire could hit 5m units by the end of January 2012. By contrast, Piper Jaffray predicts Apple will sell 13.5m iPads in the holiday period.

Another player expected to play a key role in the market is Barnes & Noble's Nook Tablet, but Microsoft's Windows 8 slate, set for launch in 2012, may be too "late to the game", Forrester argued.

"Today, the tablet market resembles the MP3-player market," Sarah Rotman Epps, a Forrester analyst said, pointing to the iPod's tight hold on this segment. "With Amazon and Barnes & Noble, you have brands that can be competitive."

Price may be one advantage for these devices, as they are more affordable than the iPad, and thus may have an advantage in terms of driving impressive volume sales.

"Apple's products are priced at the high end, and not everyone can afford that," Brian Marshall, an analyst at ISI Group, said, adding that Amazon's tablets, commanding just $199, really could "catch fire".

Jamie Iannone, head of digital products at Barnes & Noble, suggested it was the range of books, films and movies available that drew buyers to its device. "It's not about being inexpensive, it's about value," he argued.

Data sourced from Amazon, Wall Street Journal; additional content by Warc staff