(Image Source: TechFlash)

BY ADNAN S. KHAN

ANCHOR CHRISTIAN BRYANT

Just days after Amazon’s Kindle Fire was announced analyst said it wouldn’t sell more than 2.5 million units. Now CNET places those expectations as high as 6 million units by the end of the fourth quarter. PC Magazine talked to an analyst who...

“…has boosted his estimates of Amazon's expected fourth quarter sales of the Kindle Fire, partly due to the device's combination of a low price point – one that Amazon's actually losing money on with every Kindle Fire sold – and competitive features.”


That price point was originally estimated to cost Amazon $50 per Kindle Fire sold, according to the market analyst company IHS iSuppli. But the same company recently revised their estimate in a new report saying Amazon is only losing $3 on every device sold. The New York Times says that’s not a bad deal considering what the Fire is meant for.

“Of course, the idea is that Amazon eventually will make money on Kindle Fires by coaxing its customers to buy a lot more stuff from the Internet retailer, including electronic books, music and other things. Now it looks as if they won’t have to sell quite as much of that stuff to stanch the flow of red ink from Kindle Fire.”

So will Apple start feeling the heat? An editor for the Los Angeles Times says no, but that doesn’t mean the Kindle Fire won’t be a hit.

“There isn’t a single thing this tablet does better than the iPad and on the hardware side honestly there are a ton of tablets that can beat it. But, the fire can match iTunes and the App store because of what Amazon is and all the stuff they sell and all the stuff we’re probably already buying. That’s something that really no other tablet outside the iPad can offer.”


And The Huffington Post notes the Fire is not meant to be a traditional tablet. Rather it’s designed to be an extension of the Amazon’s business model.
 

“Most tablets are just technology … Amazon leads the way in this marketplace for one simple reason, content. Amazon is a content company that happens to create technology. The Kindle is built to serve the content, not the other way around.”

CNET notes Apple is pulling back production of iPad 2, in preparation for the iPad 3 which is slated for release early first quarter of 2012, bringing down iPad 2’s expected sales for this quarter to 9 million, down from 11 million.