Amazon Kindle tablet launching next week?

Given that a press invite from Amazon just hit my inbox for next Wednesday in New York City, I’d say it’s a safe bet that the long wait for Amazon’s tablet entry is about to end. The invite doesn’t offer any details, but all signs have hinted at a fall release for the device. And given the reported amount of Amazon tablets that were ordered from third-party hardware manufacturers — upwards of 800,000 per month — such a product launch would certainly warrant a huge press event.

Earlier this month, a prototype of the device, expected to be called the Amazon Kindle tablet, got a once-over from MG Siegler, who shared his initial impressions after using the device for a short time. Much of what he said then confirmed some of my prior thoughts and expectations of the device. It will likely be a 7-inch slate based on Google Android, but like the Barnes & Noble Nook Color, Android will be hidden under a custom interface. Siegler mentioned a cover-flow type of interface for Kindle books, music and video, which makes sense. In fact, the latest version of the Kindle app for Android devices moved in this direction as well; possibly offering a preview of what to expect.

We won’t know the tablet cost for sure until the product actually launches, but my thought was a top price around $250 with possible subsidies offset by Amazon Offers or Amazon Prime, which could further lower the cost in the sub-$200 range. Siegler confirmed the $250 price tag after using the device although Amazon could have since changed their position or could announce special deals to further reduce the price.

One “missing” feature that Siegler didn’t see (but I expect to be part of the device) is the Amazon AppStore, which is composed of curated Android applications. It’s clear the tablet will focus on Amazon’s media offerings — books, MP3s and videos — and it will have a web browser. Amazon has invested a fair amount of time and effort to create its Amazon AppStore, and I don’t see any reason why it wouldn’t incorporate that into its tablet. Given that the device isn’t expected to have any Google apps at all, it seems likely to me that some basic third-party software options would be welcome. We’ll find out for sure as early as next week.

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Android this week: Amazon’s tablet spied; Samsung Note debuts; Tablets galore at IFA

Amazon’s long-awaited entry into the Android tablet space is nearly ready and expected to launch in time for the holiday season. But it’s not the tablet that some were expecting. MG Siegler from TechCrunch spent an hour with a sample of the device and shared his experience: Instead of a full-fledged Android tablet, Amazon’s new Kindle slate runs a forked version of Android under the hood that no user is likely to ever see.

The 7-inch tablet takes a cue from the Barnes & Noble Nook Color; arguably the most successful non-iPad tablet if it fits your definition of one, and likely to see a hardware refresh soon. Amazon’s tablet will use a completely customized interface, not have Google apps of any kind, nor will it access the Android Market. It will run apps from Amazon’s AppStore.

Software to read Kindle books, watch Amazon videos on demand or play music from Amazon’s MP3 store and Cloud Drive service are the focal points. Expected to launch for $249, possibly with a free subscription to the Amazon Prime shipping service — normally $79 per year — the tablet could be a holiday hit for mainstream consumers who want a traditional Kindle with more access to Amazon services.

Those wanting something smaller than a tablet but bigger than a standard phone may be more interested in the newly announced Samsung Note. The handset uses a 5.30 inch Super AMOLED display with 1280×800 resolution and includes a digital pen which fits inside the phone for storage. Samsung says this combination of hardware features makes the Note a new class of device for enterprise users who want to capture and store digital notes. The pen is pressure sensitive and may be used for drawing images as well.

Samsung hasn’t abandoned the 7-inch tablet market, however. The company also announced a refresh of the existing Galaxy Tab with a 7.7-inch version that uses a 1280×800 screen like the Note. However, the display technology is boosted up to Samsung’s Super AMOLED Plus, providing more vivid colors that appear to pop off the screen. The new tablet uses a dual-core 1.4 GHz processor, Google Android Honeycomb and a boosted battery capacity over the prior version.

Toshiba and Lenovo also debuted new Android tablets this week at the IFA exhibition in Berlin, Germany. Toshiba slimmed down its existing Thrive tablet to create the AT200; just 7.7 millimeters in thickness. The 10.1-inch slate uses a 1.2 GHz dual-core process from Texas Instruments and has a micro HDMI port to share media with a high-definition television.

Lenovo’s newest Android entry, the A1, runs on Gingerbread, which is designed for smartphones, and offers 1024×600 resolution on a 7-inch touchscreen display. It only has a single core processor and reminds me of last year’s Galaxy Tab from Samsung. However, the Wi-Fi model with many of last year’s hardware components has a price from 2010 as well: the A1 will cost only $199 and should appeal to many at that price due to its versatility and portability.

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3 reasons a new Nook Color is likely coming soon

Barnes & Noble is reportedly planning a new Nook Color tablet as early as this month, based on information from component suppliers in Asia. The company is looking to have up to 3 million Nook Color 2 devices produced before the end of 2011, based on industry sources speaking to DigiTimes. Although the current Barnes & Noble Nook Color is technically an e-reader, it’s also likely to be the most successful selling tablet outside of Apple’s iPad, with several million estimated since it debuted in October of last year.

DigiTimes isn’t known for 100-percent accuracy, but the publication does have well-placed contacts within the Asia-Pacific region where many of today’s consumers electronics and computing devices are made. And news of an updated Nook Color makes sense to me for three reasons:

Success of the current Nook Color. This is a two-sided coin, because on one hand, if a product is selling well, there’s less reason to replace it with a new product. On the other hand, technology cycles are changing ever faster, so in order to “keep up” and stay competitive, timing is important to continued success. Part of the company’s timing may have much to do with the anticipated Amazon tablet that many, including myself, expect to debut before the holiday season. Beating Amazon’s first tablet with a second generation unit could blunt the impact of Amazon’s entry to the tablet market, even if it is a heavily customized 7-inch Android slate for $250 with an Amazon Prime membership as I guessed a few days ago.
Tablet competition. Many are happy with the existing Nook Color as a tablet, and for good reason. The $249 cost is far less than most tablets, and it’s an easy process to unlock the standard Google Android tablet experience on the device. Doing so gives the best of both worlds: A solid e-reader and a full-featured Android slate. But a new generation of powerful tablets is on the way soon. The current Nook Color won’t compete against them, but it may compete against more capable older tablets that are likely to start dropping in price. And there’s even new competition in today’s market, evidenced by the just announced Lenovo A1, which has more hardware features — cameras and faster processor, for example — costing only $199.
Reliance on digital media. Earlier this week, Barnes & Noble reported financial results for its fiscal first quarter of 2012. Traditional store sales decreased 3 percent to $1 billion, but the company’s Nook business including hardware, digital content and accessories jumped 140 percent to $277 million. The company also provided guidance by saying its Nook business is expected to double to $1.8 billion this fiscal year. Essentially, the Nook business is a large focus for the company’s future, and it needs to keep a fresh product pipeline flowing.

So if there is a Nook Color 2 debuting soon, there’s a question of what will it look like. While the company could go with a larger design to rival a rumored 10-inch Amazon offering, I’m leaning more towards the 7-inch screen size used in the current Nook Color. Any larger, and the device becomes less of a reader and more of a tablet that’s unwieldy for long periods of reading. The only reason I could see Barnes & Noble go with a bigger screen is because of magazines: Last month, the company announced more magazine titles along with enhanced interactivity that could benefit from a larger screen.

Even if the screen size on a Nook Color 2 increases over the original model, however, I’d think it would be more of a jump to 8- or 8.9-inches, not 10.1-inches. That is, unless Barnes & Noble plans to supplement its digital e-book content with other media such as movies or television shows, although I’m doubtful of that.

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The many ways Amazon could price a successful tablet

Amazon’s anticipated tablet is expected to cost between nothing and $400, depending on who you ask. Clearly, part of the pricing equation depends on what capabilities and hardware the product, or products if there are multiple device sizes, will actually offer and use. So until Amazon officially announces its tablet entry, nobody really knows how much it will cost and what it can or can’t do. Will it be a more of an e-book reader, a pure, full-featured tablet with e-book software or, like the Nook Color, something in between?

The best bet is the third option, which should keep the price under $250, especially if Amazon decides on the highly portable 7-inch screen size. A number of clues lead me to that conclusion. An Amazon tablet is sure to support Kindle reading software, but I’m not sold on reading Kindle content on a large, heavy device for extended periods at a time. There’s a reason Barnes & Noble’s Nook Color is dubbed “the reader’s tablet” by the company: It’s small and light enough to be a full-time e-reader. And like Barnes & Noble, Amazon has its own curated application store for Android software, indicating an Amazon tablet will run modern software titles, unlike a dedicated device like the Kindle.

Media choices, a software ecosystem and a unique screen

Amazon’s Kindle has helped define the e-book market, and it wouldn’t surprise me if the company continues to leverage the Kindle experience on its own tablet. While Kindle books can be read on nearly any other tablet, Amazon could opt for a dual-display on its tablet. New technologies that replicate eInk in one mode and a more traditional LCD experience in another mode have been demonstrated over the past few years but haven’t found their way into mainstream products. Aside from the eInk benefit when needed specifically for e-books, these displays require less energy to run.

Amazon’s digital content isn’t limited to books though; the company also has media options available to it and devices that run on Google’s Android platform. Amazon’s MP3 music store is becoming the standard shop for Android music lovers, often pre-installed on Android devices. The service integrates with Amazon’s Cloud Drive and Cloud Player app, allowing music to be bought on the handset for direct download or for immediate streaming over Wi-Fi or mobile broadband. Amazon’s Unbox service provides video content — the amount of which was recently expanded to 100,000 titles – that could also be brought to an Amazon tablet.

A “win-win” subsidy

What do these options have to do with the price of an Amazon tablet? Amazon has more options than any other tablet-maker that could be used to subsidize the cost of a tablet. For example: the full price of an Amazon tablet may be $350 so that the company covers costs and makes a small profit. But what if the price was lowered to $299 as long as buyers agreed to see ads for Amazon’s daily deals or other shopping specials, similar to how Amazon sells the Kindle for $25 less with Amazon Offers? In this case, Amazon wins more business as the tablet becomes a shopping portal and customers win with low prices on products.

Take it a step further. Could Amazon further drop the price to $199 and take a loss on the hardware provided customers agree to rent a set number of movies or buy an MP3 album each month? Maybe the $199 tablet comes with a year of Amazon Prime (free two-day shipping) service; based on the increased number of purchases I’ve made since getting Amazon Prime, the company could easily recoup the tablet subsidy in short order. The point is: Amazon has levers that few others can pull in the tablet space in terms of price flexibility.

How much will consumers pay?

It’s becoming clear that tablets competing with the iPad are unlikely do well if priced like an iPad. Even with $100 price reductions, there’s no guarantee of success, and it’s not until a decent product goes on a $99 fire sale before consumers buy a non-iPad like frenzied sharks in a school of fish. So no matter what Amazon’s tablet(s) look like or can do, I don’t expect to see a $499 price point. Instead, similar to the Kindle, there could be multiple, lower price points, depending on what other Amazon services a consumer will accept with the tablet.

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The Nook Color is doing well at its $249 cost, with one million units reportedly sold in the last quarter of 2010 and several million more built for the bookseller. That price target is the upper end of Amazon’s tablet in my opinion. We may see an “unsubsidized” model in the $279 to $299 range, but probably not higher.

That figure fits in nicely with what consumers expect to pay for a tablet: The Institute for Mobile Markets Research surveyed consumers and found the median price they’d be willing to pay is $320. If correct, a feature-rich Amazon tablet priced at $299 or less could be a hit: Forrester Research today notes that at or below a $300 price point, Amazon could sell between 3 and 5 million such tablets.

Although we don’t yet know all the details of what an Amazon tablet will look like or what it will be able to do, what’s your take on the price? Do you think Amazon will build an Android tablet with an interface better than existing Honeycomb tablets and price it for less or will the company try to take on Apple at $499? Have at it in our poll!

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