Amazon is gearing up to release a tablet computer on Wednesday that could gain customers at the expense of Apple, according to several media reports.
Cupertino, Calif.-based Apple has dominated the nascent tablet market, but analysts say Seattle-based Amazon could grab market share from the iPad.
Tomorrow morning in New York City, Amazon will introduce the Kindle Fire, a 7-inch backlit display tablet that will be ready to ship in November, TechCrunch reported. The device apparently looks like Research in Motion’s BlackBerry PlayBook because it was designed by the same original equipment manufacturer, Quanta Computer, according to the tech blog, which has previously said the tablet will cost $250.00 – about half the price of the iPad.
Amazon’s tablet could help the company sell other services. James McQuivey, an analyst with Forrest Research, told Reuters the tablet is “a marketing tool to build a relationship with customers and sell them cloud (computing) services."
Observers are really wondering whether Amazon can emerge as a serious contender to Apple, the leader in the tablet computer space. Greg Raiz, CEO of mobile app developer Raizlabs, told the Boston Herald that Amazon has a unique chance of challenging Apple’s dominance in the tablet space. Citing market research firm IDC, the article said Apple controlled 69 percent market share in the second quarter of 2011. Certain competing devices like RIM's BlackBerry PlayBook have suffered lackluster sales. Still, Apple already is facing competition from Android-based devices. In August, ABI Research reported that Android media tablets have collectively snatched 20 percent market share from the iPad over 12 months.
“However, no single vendor using Android (or any other OS) has been able to mount a significant challenge against it," the research firm cautioned.
Research firm Gartner projects that Apple’s iPad will account for 73.4 percent of worldwide tablet media sales this year, down from 83 percent in 2010. Beyond Apple iOS and the Android operating system, Gartner does not expect any other platforms to control more than 5 percent share of the tablet market in 2011.
That could soon change. In a blog in late August, Forrester Research analyst Sara Rotman Epps predicted that Amazon could sell between 3 and 5 million tablets in the fourth quarter alone if it sells a device under $300.
“Even though Amazon taking on Apple is a bit like David taking on Goliath (compare the market cap, profits, and cash position of the two companies), Amazon’s willingness to sell hardware at a loss combined with the strength of its brand, content, cloud infrastructure, and commerce assets makes it the only credible iPad competitor in the market," the analyst wrote.
