Amazon Denies Rumors of a $99 Kindle Fire HD

kindle-fire (via Reuters)

Wow! Wouldn’t it be awesome if you got a color, touchscreen Kindle Fire tablet — with an HD screen — for just $99? And one well-respected technology blog reported just that possibility on Wednesday. “We’re now hearing that a $99 Kindle Fire 7″ tablet is in production, and will be shipping this year,” wrote Sarah Perez at the technology blog TechCrunch.

But just hours later, a business news blog was reporting that Amazon had already issued an official denial of that report. “It’s not happening,” BusinessInsider quotes Amazon as saying. “We are already at the lowest price points possible for that hardware.” Of course, BusinessInsider had already run their own story about the possibility of a $99 high-definition Kindle Fire Tablet — citing as their source that first blog post which appeared on TechCrunch. It now appears below Amazon’s official denial, and BusinessInsider is probably glad they’d added a few skeptical sentences (noting, for example, that TechCrunch had called the story a “rumor” that she was “hearing”.)

It’s a really fun idea, though, so I enjoyed reading the rest of the analysis from BusinessInsider. (“It’s a stunning price point, but it’s not totally crazy from Amazon…”) They note that TechCrunch reported Amazon may have gotten a discount on the chips for their tablets, and adds that “it’s not hard to envision Amazon selling a Kindle Fire tablet at or just below its manufacturing cost.” BusinessInsider‘s best estimates are that Amazon spends $174 to build the 7-inch version of their tablets, but their reporter also notes that Amazon’s CEO “says he wants to make money when people use a Kindle, not when they buy one.

“This makes Amazon completely different than Apple, which makes money on hardware, and picks up some additional revenue from apps and content…”

It’s almost obligatory for articles like this to ask who wins and who loses. Microsoft and Google would both be threatened by a $99 tablet, BusinessInsider concludes, because neither company has significant traction yet in the market for selling tablets. Apple wouldn’t be threatened now, but “In the long run, like in five years, it will be a problem for Apple because the price of an Amazon tablet isn’t going up. The software and hardware aren’t going to get worse, they’re only getting better.” And what’s fascinating is that all of that is absolutely true, even if Amazon isn’t releasing a $99 version of their high-definition Kindle Fire tablets.

Inevitably, reporters have to play these elaborate games of “What if…?”, because it’s all part of sorting out whether the rumor really is plausible. But it’s also a fun exercise on its own, reminding us that we do indeed living in interesting times, where you really never know what’s coming next. Wow! Wouldn’t it be awesome if you got a color, touchscreen Kindle Fire tablet — with an HD screen — for just $99?

Yes, it would….

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