No company has more to lose than Amazon.com (NAS: AMZN) should Apple's (NAS: AAPL) new iPad Mini succeed. Long before Google's (NAS: GOOG) Nexus 7 arrived on the 7-inch scene, Amazon's first Kindle Fire made a big splash by targeting a lower end of the market.
Amazon was able to pursue a strategy that no other tablet maker at the time would or could: sell at cost and profit on content afterwards. Other hardware OEMs without digital storefronts were helpless to compete, even if they were able to produce better tablets strictly in terms of hardware quality. Ironically, the Kindle Fire's success showed that mediocre hardware was sufficient provided it had strong content offerings.
The iPad Mini hasn't even hit store shelves quite yet, but Amazon already hates and fears the new device.
Yet another vaguely impressive figure
The e-tailer even took the time out of its earnings press release to boast of the 7-inch Kindle Fire HD's advantages over the iPad Mini, saying it has more pixels and higher pixel density, offers HD content, and has better speakers, all while costing $130 less.
When asked about the iPad Mini's threat after it was unveiled, Amazon characteristically offered up another impressive, yet vague, sales figure, telling AllThingsD, "Wednesday [the day after the iPad Mini event] was the $199 Kindle Fire HD's biggest day of sales since launch and up 3x week over week." That suggests many consumers who may have been waiting on the sidelines were disappointed with what Apple had to offer. We already knew Amazon was selling a lot of these tablets, but your guess is as good as mine as to how many that actually entails. Either way, three times "a lot" is more than "a lot."
Amazon has now plastered a big battle cry right up on its home page, a clear proclamation of "Bring it!" toward Cupertino's general direction.
Amazon is one of the most heavily trafficked websites on the Internet, so you know this is going to be seen by a lot of eyeballs. These are all words and actions of a company that has a lot to lose, and fears it may lose, but remains confident in its compelling value proposition.
Objection, your honor
Of course, if you ask the Mac maker, it will point to its 35% larger screen size, higher build quality, thinner and lighter body, better cameras, and wider selection of tablet-optimized apps. Apple made sure during its presentation to point out its advantages over its 7-inch rivals, and clearly the Kindle Fire HD and Nexus 7 are what the company had in mind.
Let's stack the two up side by side, with the advantages that an average consumer would be likely to perceive bolded.
Kindle Fire HD
1280 x 800
1024 x 768
Dual-core OMAP 4460
Front-facing HD camera
Front-facing FaceTime HD camera; rear-facing 5-megapixel iSight camera
193 mm x 137 mm x 10.3 mm
200 mm x 134.7 mm x 7.2 mm
Sources: Amazon, Apple.
Also, the iPad Mini will be available in many more countries around the world with more localized content, but the Kindle Fire has a greater selection of e-books under Amazon's belt.
While I may think the iPad Mini boasts the most advantages, despite its hefty premium, there are probably just as many people who swing the other way. This battle has just begun, and the victor is yet to be determined.
The difference in pricing underscores the two dramatically different approaches these tech heavyweights are using to tackle the tablet market. Amazon uses hardware to sell content; Apple uses content to sell hardware.
Who will win?
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The article Amazon.com Already Hates and Fears the iPad Mini originally appeared on Fool.com.
Evan Niu, CFA, owns shares of Apple. The Motley Fool owns shares of Apple, Amazon.com, and Google. Motley Fool newsletter services recommend Apple, Amazon.com, and Google. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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