Friday, November 11, 2011

Will Kindle Fire threaten iPad?

Amazon‘s (AMZN) highly-anticipated Kindle Fire debuts next week, and sales will undoubtedly be red hot.
But are those sales cutting into purchases of Apple‘s (AAPL) iPad? It looks that way, based on one new study. The survey, conducted by ChangeWave Research and RBC Capital Markets, found that 26% of people who plan to buy a Kindle Fire say they are delaying buying an iPad.

The results are interesting, especially considering that the Kindle Fire and iPad are very different — so different, in fact, that many analysts assumed there wouldn’t be direct competition between them.
The iPad has cameras, 3G connectivity, a microphone and an accelerometer. The Kindle Fire does not. The iPad has 140,000 apps. The Fire does not.


But where the Fire does come out ahead is on price: $199, compared to $499 for the cheapest iPad.
The differences between the iPad and the Fire will become more stark once people get their hands on Amazon’s device and the reviews roll in. But just the idea of a cheap tablet that can play music, games and streaming movies — and, in all likelihood, play them very well — is giving some potential iPad owners pause.

There’s one more interesting nugget from ChangeWave’s study. About 5% of respondents had already ordered a Fire, and 12% said they were somewhat likely to buy it. That’s a bit more enthusiasm than the original iPad received in 2010. A similar study back then showed that 4% were likely to buy an iPad and 9% were somewhat likely.

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