Tag Archives: amazon

iPod Touch and the Kindle Fire

When Amazon first announced the Kindle Fire, many people heralded it as the first tablet with a chance in the market against Apple’s iPad by virtue of the fact that it was less than half the price, and more portable, with a 7″ screen.

Those predictions were recently validated, with Amazon selling an estimated 5.5M in the first quarter of release. Not bad, but we learned today that Apple sold 15.43 Million iPads, a 111% increase over the same period last year. It is an interesting contrast, but I wondered how the Kindle Fire’s sales compared to those of the iPod Touch.

My reasoning in comparing the two is that the Kindle Fire competes more directly with the Touch than the iPad. The iPad has a 10″ screen. When the first 7″ Android tablets hit the market, Steve Jobs said that Apple had considered smaller tablets, but found that the iPad was the smallest device they could make that allowed a significantly broader range of interactions than the iPhone. You can type on an iPad, as well as create documents, spreadsheets, and presentations. The Kindle Fire, on the other hand, is a lot like a big iPod Touch. The bigger screen is better for reading and browsing the web, and perhaps a little better for viewing movies. On the other hand, the iPod Touch is significantly more portable; it fits in a pocket, the Fire, in a purse.

I wondered how Kindle Fire sales compared to iPod Touch sales. Apple reported that iPod sales were down 21% to 15.4 million, but over 10 million of those were iPod touches. With a little digging, I found that Apple sold about that many iPod Touches during the same period a year prior. So, even without an update, the iPod touch is selling about twice as well as the similarly priced Kindle fire. Of course, the Fire seems to be on an upswing, while the Touch is just holding steady.

Will Hollywood Look to Apple to Lead them out of the Amazon?

After last week’s tremendous public outcry over the SOPA and PIPA bills forced the TV and movie industry and their hired hands in Washington DC to retreat, Paul Graham announced that he was interested in funding startups that might have what it takes to “kill hollywood.”

Graham is a successful software developer and entrepreneur who started YCombinator to take advantage of the mismatch between the traditional venture capital business model and the realities of post-dotcom boom Internet startups. He concluded that SOPA and PIPA were symptoms of a large but dying industry that could do “a lot of damage to civil liberties and the world economy on [its] way down.” Hastening their demise would be both a broad public good, and a good business.

Graham stated the problem broadly, asking entrepreneurs to think about what people are going to do for fun in 20 years, instead of what they do now. Graham sees the potential for continued growth in games, and other types of sites, but also sees alternatives to the ways movies and shows are currently produced and distrubuted.

A few days later, on Hacker News, YCombinator’s social news community, someone posted a link to Amazon Studios. Amazon Studios is at least a few months old, but if I’d heard about it before, I’d forgotten it. Amazon Studios says :

We believe 21st-century technology creates ways to make and share movies and scripts more easily than ever.

  • Get noticed. Your work will be shared with a global community of filmmakers and fans, who can offer revisions and advice.
  • Get your movie made. The goal of Amazon Studios is to work with Hollywood to turn the best projects into major feature films.

They run monthly contests with cash prizes for writers and film-makers.

Amazon Studios positions itself as a partner to Hollywood, but in thinking about it, I realized that Amazon already has Hollywood pretty much surrounded. Over the last 20-30 years, the overall importance of revenue from first-run TV, and movie box office has declined as a growing number of broadcast and cable TV channels created demand for TV show reruns, and revenues from movie rentals and DVD sales grew. Lately though, DVD sales have been declining, and BlueRay sales haven’t compensated, because more and more people are turning to digital distribution and streaming through Netflx, iTunes, and Amazon.

In other words, the makers of TV shows and movies have long depended on Amazon for a significant amount of their revenue, first from DVD sales, and now, increasingly from digital downloads. The Kindle Fire was aimed squarely at enhancing Amazon’s position in this market. It’s also worth considering that Amazon uses free digital downloads as an incentive to get people to subscribe to Amazon Prime.

On the other side, we have Amazon Studios, gets Amazon involved in the creation of new movies. They may be working with Hollywood, but part of their appeal is clearly to creative people who were, in one way or another, shut out of Hollywood.

This is similar to how Amazon approached the eBook market. They did deals with publishers to get the rights to distribute books on the Kindle. To secure those deals, they surely used their position as a major sales channel for traditional books. Once the Kindle was off to a good start, they started enabling independent authors and small publishers to sell their own eBooks through Amazon. Now they are starting to do deals directly with authors, taking over the role of publishers for both vetting and editing books, and underwriting their creation with cash advances.

So, how long before Amazon starts funding some of the movies themselves?  It might take longer, because movies are more complicated to make than books. Also, theatrical release is still an important part of the movie business; box office receipts are an important revenue, and it helps generate the awareness needed to drive the sale of the digital downloads.  Its also worth keeping in mind, that Amazon owns IMDB, which helps moviemakers find the collaborators they need to get movies made, and helps consumers find out about movies worth watching.

All of this puts Amazon in a strong position vs Hollywood, but its even stronger if you step back and consider how important the book industry is to the movie industry. One of the most valuable film franchises in the last few decades has been the Harry Potter films, which, if it isn’t obvious, owes its success to the Harry Potter books. The same is true for many other films. The movie industry reduces its risk by drawing on successful books.  Doing so gives them added confidence in the underlying story, and provides them with a built in audience, and built in cultural relevance. Unfortunately for Hollywood, Amazon seems likely to gain a favorable position for the film-rights for more and more books.

This is good for Amazon, but also, I think, for Apple. Apple doesn’t encircle Hollywood in quite the same way Amazon does, but iTunes is an important distribution channel for movies and TV shows. Another thing Apple has is cash, lots of it. Movies are often financed, in part, by distribution rights. Wariness over Amazon’s position is going to drive the movie studios towards Apple (just as of fear of Apple’s power drove the record labels towards Amazon), Apple’s ability to help fund new movies and shows, in exchange for favorable distribution rights, seems like it will draw them even closer to Apple.

We shall see soon enough, I guess…

Missing from the Kindle Fire: Your Photos

The Kindle Fire gives you a lot for under $200, but compared to the iPad, it is missing a lot of things.  Some of those things, like the smaller screen, less storage, lack of GPS, slower GPU, lack of volume buttons, are inevitable tradeoffs for a device that costs less than half the price of an iPad, but there is something else, something more personal that the Kindle Fire is missing: Your Photos.

On the iPad, its clear that Apple knows you value your photos. There is an option to jump directly to your photo gallery from the lock-screen.  Photos on your computer can be automatically synced to your iPad, and new photos taken with an iPhone flow directly to your iPad too via the iCloud Photostream.  You can even get a camera connection kit that lets you copy photos to your iPad directly from a digital camera over usb, or from a memory card.  Once your photos are on your iPad, browsing them is smooth and easy.  You can quickly scroll through thumbnails from thousands of photos, or you can browse photos grouped by time, location and if you loaded the photos from  a Mac and iPhoto, by the faces of people in the photos.

Amazon, on the other hand, doesn’t make it easy to get photos onto the Fire.  You can drag them over from your computer, but you’ll need the right USB cable, which isn’t included with the device. You’ll have to do the same thing every time you want to add more photos.  Once photos are on the Fire, it sounds like the experience of actually using them is anything but silky smooth.

It gets worse too, Amazon’s Cloud Drive service can store photos, but it requires you to upload the photos with a web browser, a tedious task for more than a select group of photos. Most incredibly though, there is no easy way to access photos stored on Cloud Drive from your Kindle Fire.  It doesn’t appear to integrate with the built in Gallery application at all.

This seems like a tremendous opportunity for Dropbox, which makes it ridiculously easy to get access to photos and other files from multiple devices.  Unfortunately, Amazon doesn’t seem to make Dropbox available in the Kindle Fire App store, so you’ll have to “sideload” it, but it is still (relatively) easy to do.

  1. Sign-up for a free Dropbox account with 2GB of storage, if you don’t already have one.  Use this link and we’ll both get an extra 250MB of free storage, while you are at it, download and install the dropbox client on your Mac or PC.
  2. On your Kindle, visit the download page for the Dropbox Android App and tap the download link.
  3. While you are waiting for the download, turn on the ability to install applications that you didn’t find in the official Kindle Fire app store.
  4. From the Kindle Fire home screen, tap the gear icon in the upper right corner to call up the settings panel.
  5. Click the “More” button on the right hand side of the settings panel
  6. Scroll-down and tap “Device”
  7. Switch “Allow Installation of Applications From Unknown Sources”  from “OFF” to “ON.”
  8. Return to the browser to check on your download.
  9. Look for the notification in the top-left corner that the download is complete.  Tap the notification and find the Dropbox.apk file in the list.  Tap the file.
  10. You follow the prompts to install the application.
  11. Launch the Dropbox application and log in.
  12. Any files you put in your Dropbox on your Mac or PC will be automatically uploaded to the cloud, and available through the Dropbox app on your Kindle Fire.

For more detailed instructions…

On The Kindle Fire

I’ve been thinking a lot about the Kindle FIre since it was announced, and I’ve ended up writing a lot about it too, in the form of comments sprinkled here and there on sites like Hacker News.  I thought I’d take a little time to try and get them all down in one place.  So, here it goes.


This isn’t a review, it is a rumination on what the Kindle Fire “means” in the context of the larger technology and media landscape. My goal isn’t to reach conclusions, but rather to document and share my current thinking.

I’ll start by going over some basic details about the Kindle Fire, and my first impressions from using the device, before considering the device’s relationship to other aspects of the technology and media landscape.

Basic Facts

  • 7″ “widescreen” IPS LCD Screen (600×1024, 161ppi)
  • 1GHz Dual Core CPU
  • 8 GB Flash
  • 512 MB RAM
  • Heavily modified version of Android 2.3
  • $199
  • 8 hour battery life (with WiFi off)
  • No camera, no ports beyond USB
  • Sold by Amazon at or below cost
  • Part of Amazon’s longstanding line of ebook readers
  • Positioned as a more flexible/capable Kindle, with an emphasis on consumption of the web, purchased media (including Apps) and a shopping experience.
  • Positioning was well received by consumers and critics.
  • Actual device has been panned by many critics, but customer satisfaction seems to be high.
On paper, it is a reasonably capable device, the hardware is, in many ways, gives it simlar capability to the iPad 2, though the iPad 2 has a much better GPU with a screen that is physically larger and displays more pixels.

First-hand Impressions

I haven’t spent much time with a KindleFire, but a few things are clear from my limited use:
  • The screen is crisp and bright
  • The power button is awkwardly positioned
  • The placement of the stereo speakers don’t make any sense (they are both on the same side when watching a video wide screen)
  • The UI is smooth, except when it isn’t

vs eInk Kindle

Amazon notes the Kindle Fire’s abilities as an ebook reader, but doesn’t go so far as to suggest that it is an outright replacement for an eInk Kindle.  The eInk screens are better for reading books, particularly in full sunlight, and enable both lighter weight and longer battery life.  The eInk devices are also cheaper, and available with 3G to allow downloading of new content wherever there is cellular coverage.

I suspect that for many existing Kindle owners, the Fire won’t be a replacement device.

Amazon vs Apple

Before digging into the devices, its worth comparing Apple and Amazon as a whole.

Apple started out making relatively expensive stuff that other people sold for them at a relatively high margin. Over time, Apple has taken responsibility for selling more and more of the stuff they make. They have also become an important retail channel for people who make less tangible products, like music, movies, apps and, to a lesser extent, ebooks, and they have started offering services to end-users.

Amazon started out by retailing books that other people published and quickly added all sorts of stuff that other people (including Apple) made.  In recent years they’ve become an important seller of services that other people use to provide end-user services, they’ve become increasingly important retail channel for people who make less tangible products, like music, movies, apps and ebooks. Most recently, they’ve started making and selling stuff that with the consumption (and sale) of those less tangible products.  In all of this, Amazon has been comfortable with relatively slim margins.

Both companies have been willing to buck the trend of focusing on next quarters earnings.   In Apple’s case, one result has been healthy margins, healthy profits, and strong market share.  In Amazon’s case, one result has been strong market share and modest profits.

Kindle Fire vs iPad

Amazon didn’t explicitly position the Kindle Fire as an iPad competitor, but plenty of people have made the comparison for them.  I don’t see them as direct competitors, but I am curious about how the Kindle Fire will impact the iPad in the future, and vice versa.

There are obvious differences between the Kindle Fire and the iPad.  The Fire doesn’t have a camera, the iPad has two.  The Fire has a smaller display.  The Kindle is less than half the cost of the cheapest iPad 2.  The iPad is available with more storage, and with a cellular data connection.  What are the implications of these differences?

The cost difference is obvious, a family could buy two Kindle Fires for the cost of one iPad, and have $100 to spend on content. The size of the Kindle gives it an obvious advantage in portability. On the other hand, the iPad’s size makes typing on the touch-screen practical. It’s large enough to view PDFs formatted for letter-size paper, and for browsing and using layouts for digital “magazines.” It also makes it practical to create, populate and format a spreadsheet, or a document, or a presentation.  For many people with modest computing needs, it is a viable alternative to a desktop or notebook.

In the end, I think the Kindle Fire is probably a viable competitor to the iPad for listening to music, watching videos, reading ebooks, and playing certain classes of games (provided they are available).  I think it is inferior to the iPad for web browsing, writing email, creating and editing documents.  I think the iPad has an added advantage in these areas because with iCloud, plus Pages, Keynote and Numbers, Apple provides apps and services that help people who are using the iPad as both a replacement for a standard notebook, or to augment one.

It’s worth noting too, the way that content and hardware businesses fit together for Apple and Amazon.  For Amazon, hardware is something they sell close to cost in order to enable the sales of low-margin content. For Apple, they sell content at or close to cost in order to enable the sames of high-margin hardware.  In the past, Apple’s control of music sales drove music labels into Amazon’s embrace as they looked for ways of reducing Apple’s influence.  I wonder if Apple might be the beneficiary of similar concerns on the part of media companies, since Amazon seems interested in disinter-mediating them.

The differing business models also suggest different near-term futures for the different devices.  Advances in technology will shift the price and performance envelopes for both the iPad and the Kindle Fire.

My prediction is that Apple will put most of those advances into enhancing the capabilities of the iPad in order to drive upgrades and make the iPad a viable alternative to a full-blown laptop.  I would expect an “retina” display, as well as the more capable CPU and GPU required to drive it.  They may trim weight, but I’m not convinced that battery life or weight will see rapid improvement

Amazon, on the other hand, has much less incentive to improve device capabilities.  Video and ebook reading doesn’t require faster CPU or GPU.  Web browsing might benefit from upgrades, but they seem to think their cloud-services will help with some part of browsing performance.  If games become really important on the platform, then CPU and GPU advances might have a place.  Battery life and weight have room for improvement as well. Given Amazon’s business model though, the most obvious course of action is to lower costs, which will largely be put to reducing the sales price in order to increace market penetration and leverage over content producers.  In short, Amazon has more to gain from selling more devices than they do from selling more capable devices.

vs iPod Touch

Much has been made of how the Kindle Fire compares to the iPad as a media consumption device, which is fine, but ignores the fact that an iPad is capable of being more than a consumption device.

I agree though, the Kindle does seem strongest as a media consumption device, and from that perspective, I think it is worth comparing it to the iPod Touch, which is available at about the same price point.

For that price, the Fire gives you a larger screen for watching videos, playing games, browsing the web, and shopping.  It is also reasonably portable, particularly if you carry a purse.  It is, however, far less portable than an iPod touch, which fits in just about anyones pocket, and ads the capability of taking photos and videos.

It’s also worth noting that, while the iPod is in decline, Apple still sells millions of iPod Touch devices every quarter, so at least some of the people in the market for a Kindle Fire

vs Smartphones

I’m running out of steam here, but I think a lot of the points made above, about the iPod Touch, apply here as well.  Many people already have, or will soon be buying, capable, portable media consumption devices in the form of smartphones.  However, there is evidence so far is that Android users lag iPhone users in purchasing content and apps on their devices.  This consumption gap might create an opportunity for the Kindle Fire among android phone owners, but the larger opportunity might be some sort of Kindle Phone, whereby Amazon could drive an app and media purchase and consumption experience that rivals Apple’s.

vs Notebooks

I don’t think the Kindle Fire is a viable notebook alternative, while I think the iPad is.  Further, I think over the next few years, the iPad is likely to become a more viable notebook alternative, as its capabilities advance. On the other hand, I don’t think the Kindle Fire will become a more viable notebook alternative, because Amazon will put more focus on lowering costs than they will on enhancing capabilities, particularly since their non-hardware business are likely to see more benefit from selling twice as many devices than they are from selling devices that are twice as capable.

In Conclusion

I’m tired, but at least now I have something to expand on and/or refer to in future posts.  Possible topics:

  • A closer look at Amazon and Apple’s content distribution businesses
  • A closer look at Amazon and Apple’s entire user experience offerings.  For example, Apple’s web services, desktop apps, retail experience, consumer support.


Will Google’s New Storage Prices Put Pressure on Amazon S3?

Google  just cut the cost of additional storage for Picasa & Gmail from $20/year for 10GB to $5/year for 20GB, and now you can buy up to 16TB of storage.

This service is targeted at end-users, and it is limited to Photo storage on Picasa, and mail storage for GMail, but people suspect that it will be expanded at some point to provide more general purpose storage, which seems like a no-brainer once ChromeOS is released.

It doesn’t compete directly with Amazon’s S3 cloud-storage, which is mostly targeted at developers, and can store any file, but I have to wonder if Google’s move isn’t going to force Amazon’s hand on storage pricing.  Amazon may not compete directly with Google in this regard, but a lot of Amazon’s customers are, in one way or another.  Google’s old pricing was somewhat higher than Amazon’s, which left developers with room to use Amazon’s storage to compete with Google.  The new Google pricing totally inverts that.

Amazon’s pricing is due for revision anyway.  Cost of raw storage have declined significantly since S3 debuted, and I’m sure Amazon has been able to lower their operating costs significantly as well, but these savings haven’t really been passed along.  They cut their prices somewhat a year or so ago, and instigated a tiered pricing scheme that rewards large customers for growth with declining marginal costs for storing more data, but the new Google pricing takes things to a “whole nother level.”

It’ll be interesting to see whether S3 and other “cloud” storage providers, and the applications that build on them are about to follow suit.