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On this blog we will track down the latest Amazon Kindle news. We will keep you up to date with whats hot in the bestsellers section, including books, ebooks and blogs... and we will also bring you great Kindle3 tips and tricks along with reviews for the latest KindleDX accessories.

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September 2016
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Kindle Fire Passed By Nook Tablet in Web Traffic

Right now it is safe to say that the iPad is on top when it comes to tablets.  I’m assuming nobody genuinely thinks anymore that the Kindle Fire was ever about trying to bring down Apple’s device.  It is no surprise then that in a recent analysis of their web traffic impressions, the Chitika Ad Network found that 91% of tablet traffic on the web comes from iPads.

What was somewhat surprising was that for the first time we see the Nook Tablet beating the Kindle Fire in terms of use.  Since May, the Nook has jumped from making up 0.53% of all tablet traffic to accounting for 0.85%.  For just a month, that’s an impressive increase in presence.  The Kindle Fire saw no such increase and even seems to have fallen off slightly in the same period.

What does this mean for the two devices?  Unfortunately this data is hard to draw any real conclusions from.  Lacking any sort of information about data collection, we don’t even know as much about what devices we are talking about.  How much of the Nook’s internet presence comes from people running rooted tablets thanks to simple tools making use of the SD slot, for example?  That matters, since it is essentially a lost customer for B&N when they are selling their hardware at near-cost in order to lock people into their ecosystem.

Even if we assume that those users are completely removed, we are still left with a study that examines only web use.  Anybody who has spent time browsing the internet on either of these devices already knows that while pleasant enough for what it is, the browsing experience a 7” tablet offers will generally fail to impress.

I would be more excited to see information about impressions and click-throughs on advertising in popular apps across multiple platforms.  That would be likely to give us a better understanding of the comparison since just about everybody loads up some Angry Birds or Words With Friends from time to time.

With the iPad still providing about fifty times the traffic of its closest competition this is all really a minor point.  You just can’t expect a small device designed for media consumption to do the same job or generate the same interest as Apple’s more powerful and popular product.  They have nothing to fear from Android tablets in general right now, let alone the budget side of the market.

Clearly this data will be helpful for anybody who is interested in trying to target tablet users specifically when designing a web-based advertising campaign.  For the rest of us, however, there is not enough detail to be worth thinking too much about it.  It would be nice if the Nook Tablet suddenly experienced a huge boost in popularity since Amazon couldn’t help but push back by adding new products or software features, but that isn’t necessarily the case here.

Maybe the next generation of tablets, with Windows 8 competing against the iPad and a Microsoft-backed Nook line providing intense competition for the Kindle Fire, but for now things are pretty much on hold.

Amazon Revenue Shortfall A Sign of Kindle Success?

Investors have recently suffered a bit of disappointment as Amazon’s fourth quarter revenue failed to meet expectations.  Stocks fell, as a result.  The big question is why this was the case.  With Amazon saying that the sales of their Kindle line were up 177%, and the Kindle Fire specifically being the best selling product on their site since before it was even released, it’s possible we have an answer.

Regardless of whether or not the Kindle Fire, or any of the Kindle eReader devices for that matter, is being sold at a loss, it is definitely not being sold for a significant profit.  That is even taking into account nothing beyond the simple numbers that people have managed to break down as far as parts and manufacturing cost estimates and ignores any other form of investment the company has to make to create a successful product.  This means that everything after launch from software development to marketing to Amazon’s ever impressive support staff will inevitably push things over into the red.  This can create some misleading information when you launch something like the Kindle Fire that exceeds expectations so strongly.

The way the Kindle line works, especially the Kindle Fire, is that the profit always comes from media purchases over the course of the device’s life.  By providing each customer with a simple way to get whatever they want at a moment’s notice with no complications, Amazon makes it easy for a $1 eBook here and there to add up to a decent income.  This means that while expected income for the company on each Kindle Fire is estimated to exceed initial guesses, it will take time for that to manifest.  The short term will see more investment in making the product as indispensible as possible to users and cement customer loyalty even if it means taking larger short term losses than expected due to the sheer number of new users.

Basically that is what this all seems to come down to.  Despite the doomsday predictions floating around now that Amazon has had a superficially bad quarter, there is reason to believe that the short term loss is actually a good predictor of long term growth.

The Kindle Fire has had a huge impact on markets and now accounts for the largest percentage of Android tablet usage by some accounts.  It is beating out the competition and still gaining momentum along the way.  There have been some reports that Android developers are currently making as much as 250% more off of their app sales on the Amazon Appstore than on those made through the general Android Marketplace, especially in those situations where revenue is advertising based.

The model is working and people are definitely making good use of their new tablets.  While it remains to be seen what will come of Amazon’s efforts beyond the Kindle Fire, particularly given that future installments are rumored to be vaguely directed at confrontation with Apple’s iPad, right now there is every reason to believe that the experiment in moving beyond eReaders was a success.

Amazon Kindle Fire Profits May Exceed Initial Estimations

It comes as no real surprise that Amazon’s bestselling Kindle Fire tablet is going to make the company some money despite estimates that say the hardware is being sold at, or even slightly below, the cost of manufacturing.  They basically brought eReading to the mainstream at a time when people barely understood what the idea meant, after which I tend to give them the benefit of the doubt when it comes to identifying profitable ways to create content sales.  What has come as a surprise to many is exactly how much average profit the company many stand to make on each unit.

Ross Sandler, an analyst from RBC Capital, has managed to estimate that your average Kindle Fire will be the source of around $136 of income for the company during its lifetime.  Naturally this is speculative to a certain extent, but it was based on an independently conducted survey of over 200 Kindle Fire owners regarding their spending habits thus far.  The findings are actually somewhat surprising to me and I have to wonder if they don’t reflect a certain amount of skewing due to early adopters with narrow expectations of the tablet’s potential.

Personally, despite having had the Kindle Fire since the day it came out, I can’t imagine sitting through so much as a single book on it.  It works for the occasional article or academic publication when needed, and I couldn’t be much happier with the PDF functionality for my own purposes, but owning E INK eReaders has left me with higher expectations.  It was therefore interesting to find that the most popular use for the Kindle Fire among those surveys was eBook reading by a wide margin (71% citing this as among their most frequent uses.

Also interesting is the fact that video streaming, which has seemed to be Amazon’s primary focus with the Fire so far, is relatively unpopular with only 13% of those surveyed reporting it as a frequently used feature.  That seems to include all video streaming, including things like Hulu Plus and Netflix, which works against Amazon even further given their efforts to built the Instant Video service into something impressive.

So where is all of this money that the Kindle Fire will supposedly earn coming from?  It looks like the current numbers support an estimation of around 5 eBooks per quarter, 3 apps per quarter, and a noticeable but unaccounted for increase in the number of general Amazon purchases each quarter.  My inclination would be to say that this is an overestimation of eBook purchasing and an underestimation of app appeal that will turn around once people get more comfortable with the capabilities of the tablet, but that is admittedly a matter of personal observation with no backing in numerical research.

The problem with any survey of this sort is that it the recent surge in Kindle Fire owner numbers has led to potential inaccuracies.  This is especially the case since all those surveyed came to own the Fire during 4th quarter 2011, nearly half of them as gift recipients.  It is hard to know for sure if things will change once the primary pool of new owners is made up of people buying for themselves.  Even so, chances are good that the numbers will level out somewhere along these lines.  Amazon clearly made a smart move here, and the Kindle Fire is going to pay off big in the long run.