When we first reported on the Amazon Kindle Fire, there were reports that Amazon was losing around $50 per unit sold. According to an estimate from research firm iSuppli, each actually costs $209.63 to produce.
So the going rate of $199 isn’t too bad of a hit as we once thought. It’s still similar to the original Kindle e-ink devices in that the devices will be sold at a loss to maximize distribution, however. Amazon is serious about making the Kindle Fire appealing and compete fiercely with other tablets, 7-inch or not.
But the Kindle Fire is not the only 7-inch tablet on the block with a price under $200. Lenovo’s upcoming IdeaPad A1 tablet will also be $199, and it has some features that the Kindle Fire doesn’t have, including front and rear cameras, and GPS. There’s also the rumored Huawei MediaPad tablet coming to T-Mobile that will supposedly have a $199 price tag (with a 2-year contract commitment, of course) and support T-Mobile’s HSPA+ network. Toshiba’s Thrive 7″ is also on the horizon, as is Barnes and Noble’s NOOK Color follow-up, and Samsung’s Galaxy Tab Plus, and Galaxy Tab 7.7.
No matter what the Amazon Kindle Fire is competing against, it’s clear that mobile-OS tablet pricing across the board, for 7-inch and larger tablets, will have to come down in order to stay competitive with devices like the Kindle Fire. Tablets are still not considered “essential” devices, so it’s going to be tough for many tablets to stay at the higher price points and still seem like attractive buys for budget-conscious consumers.