Amazon stock is up down $10 in after-hours trading today as the company reported first quarter sales that grew 22 percent to $16.07 billion — and income that decreased 37 percent to $82 million.

It’s like the opposite of Winston Churchill’s Battle of Britain quote: Never were so many products sold for so much money by such a huge company for so little profit.

For years, Wall Street has been giving this company a pass for never-ending promises for the future — essentially, startup style economics and pricing — and it still is, 16 years after Amazon was founded. While sales grew to $16 billion, free cash flow decreased 77 percent to just $177 million. Part of the reason for that, of course, is Amazon spending $1.4 billion on corporate office space and property in Seattle. The quarter’s income of $82 million compares to the year-ago quarter’s $130 million — already not a huge amount of profit for sales in the mid-teen billions.

But there is a considerable amount of truth that Amazon is still very much in land-grab mode. And the company’s earnings press release highlighted that aspect.

In fact, a full 12 of the 15 highlights Amazon chose to feature in its earnings release are related to digital content, cloud services, and Amazon’s vehicle for delivering that content and services, the Android-based Kindle Fire. And Amazon CEO Jeff Bezos’ first quote in the release is about content — television content, no less:

“Amazon Studios is working on a new way to green light TV shows. The pilots are out in the open where everyone can have a say,” Jeff Bezos, founder and CEO of Amazon.com. “I have my personal picks and so do members of the Amazon Studios team, but the exciting thing about our approach is that our opinions don’t matter. Our customers will determine what goes into full-season production. We hope Amazon Originals can become yet another way for us to create value for Prime members.”

Interesting.

Guidance for the future is not much better, with Amazon CFO Tom Szkutak saying that the company estimates income for the coming quarter at between $0 and $350 million. Which doesn’t really appear to be much guidance at all — a very Szkutakian quality, apparently.

Wall Street, at least seems to be buying it.

For all its vaunted reality-distortion-field capabilities, Apple’s got nothing on this company.

Photo credit: public.resource.org via photopin cc

That’s a very good thing — if you’re an app developer.

According to the analytics firm App Annie, which launched Amazon app store analytics in beta last month, 19,000 developers are now publishing apps to Amazon, as opposed to 180,000 using Google Play and 210,000 who are publishing apps to Apple’s iOS app store. The lower number of apps and the fewer developers focusing on Amazon make for a less crowded marketplace in which there’s a little more room to grow.

“While Amazon Appstore is the new kid on the block, we hear great things from developers about their ability to monetize from the store,” App Annie CEO Bertrand Schmitt said in a statement.

Source: App Annie

The top 10 paid apps in the Amazon app store – U.S.

App Annie unveiled its fully baked solution recently — just after Amazon announced an impending expansion of its app store to 200 countries — and today released the results of a 1,500-developer survey focused on Amazon’s app store.

The top three reasons developers release apps for Amazon start with convenience. After all, Amazon Kindle runs Android underneath that Amazon skin, and it’s easy to port apps to Amazon’s store. Second, however, is the hope of more sales, as Amazon just announced earlier this month that it is rolling out to 200 more countries, including Australia, Brazil, Canada, Mexico, India, South Africa, and South Korea — which buys a lot of apps. And the third reason is that when it comes to Android tablets, Kindle Fire is, well, on fire.

Amazon does not disclose Kindle sales numbers, but in January Localytics said that the number of Amazon Kindle Fires grew 322 percent in the holiday quarter — quadrupling the growth of the next-leading Android tablet, a Galaxy Note II from Samsung. This means that as Android increasingly penetrates the tablet market, Amazon increasingly penetrates the Android ecosystem.

There is one down side to the Amazon app store, however: price point.

App Annie says that the top 400 apps on Amazon have an average price point almost half that of Google Play and iPad, and even less than iPhone, even though smartphone-focused apps are typically cheaper than tablet-focused apps. The average price of the top 400 paid apps on Google Play is $3.55. On iPad, that’s a slightly cheaper $3.39. But on Amazon’s app store, that’s a much lower price point: $1.73.

Which shouldn’t come as a shock, I suppose: Amazon is the U.S. Internet’s superstore, and sharp pricing has been built into its business model since the beginning.

But it is something to keep in mind.

Microsoft’s next round of Surface slates may include a competitor to the iPad Mini and Kindle Fire.

The company is reportedly working on a 7-inch Surface tablet, which is expected to go into mass production this year, the Wall Street Journal reports. It’s unclear if this is the same gaming-focused 7-inch Xbox Surface tablet we heard about last year — but I’d wager they’re two separate products.

From what we’ve heard of the Xbox Surface, it’s going to be jam-packed with cutting edge hardware, which means it likely won’t go cheap. At the same time, Microsoft will also need an inexpensive small tablet to compete with Apple and Amazon.

Small tablets (under 8-inches) accounted for half of all shipments in the fourth quarter, according to IDC. Given just how much cheaper smaller tablets tend to be — ranging from $200 for the Kindle Fire and Nexus 7, to $329 for the iPad Mini — they’ll certainly end up taking over much more of the market over the next few years. Microsoft simply can’t afford to wait on developing an inexpensive small tablet.

Additionally, the WSJ notes that Microsoft is still testing a Surface phone, though component suppliers aren’t able to confirm if it will ever be released. We’ve heard a Surface phone could appear this year, especially if Windows Phone 8 fails to catch on with consumers.

Photo: Devindra Hardawar/VentureBeat

Can’t remember the names of the guest star on the episode of Doctor Who you’re watching via Kindle Fire? Well, Amazon has you covered.

Today the company is rolling out its X-Ray feature for TV shows playing on any of its Kindle Fire devices. Powered by data from IMDb, X-Ray lets you pull up information about the show’s characters, actors, production staff, and even some interesting factoids if available. Amazon already offers this sort of video background info on movies and ebooks sold through its online store, but obviously TV is probably where it’ll become the most useful for Kindle owners.

Initially, Amazon is only offering the X-Ray functionality on the most popular TV shows. Some of those include Doctor Who, Falling Skies, Justified, Downton Abbey, The West Wing, Sons of Anarchy, American Horror Story,  The Walking Dead, Lost, Glee, Breaking Bad, and Game of Thrones.

Of course, the timing for this is perfect considering that both Doctor Who and Game of Thrones return with new episodes this weekend. (Therefore, you have no excuse not to catch up on old episodes before Saturday/Sunday night.)

Doctor Who image via BBC

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

In 2013, we’ll download 10 apps for every single woman, man, and child on planet Earth.

Half of those apps will be Android apps, which will have 58 percent smartphone app share, according to ABI Research, and 41 percent of those will be iOS apps. Apple’s iPhone will account for 33 percent of smartphone app downloads, ABI says, while the company’s iPad will take 75 percent of tablet app downloads. Windows Phone and tablet devices will account for the majority of the rest, with BlackBerry taking about a 2 percent share.

Add it all up, and about 35 billion Android apps will load to devices in 2013, plus another 29 billion iOS apps.

That is a lot of apps.

While Google’s Android is clearly doing well in smartphones, the future of its tablet aspirations is not yet as clear. Only 17 percent of tablet downloads in 2013 will be on Android tabs, ABI says, which compares poorly to iPad’s 75 percent tablet app share.

“The most pressing issue for Google is how much of this handset momentum will ultimately trickle down to tablets, where Apple is holding the fort remarkably well,” ABI analyst Aapo Markkanen said in a statement.

Source: Jennifer Van Grove/VentureBeat

Jeff Bezos and the Kindle Fire

Interestingly, Markkanen says that Amazon, which is a major Google frenemy, might be helping Android the most in the tablet space, since its Kindle Fire is almost certainly the best-selling Android-based tablet on the market. The enemy part is that Amazon’s Android is a de-Google-ized version of Android which taps into Amazon’s content ecosystem, not Google’s.

The friend part is that since Kindle Fire is giving Android at least some degree of tablet momentum, app developers are more likely to build apps for Android-based tablets, which they can then sell on both Google and Amazon app stores.

But Google needs more Android tablet partners to do well if it wants Android’s share of app downloads to increase.

“The question is becoming, is there enough critical mass with Android partners, led by Samsung?” Jeff Orr, another ABI analyst told me over the phone. “And, are there going to be more vendors who can make a move and break away from the pack?”

Another big question: How will wearables affect the market?

Google is coming to market with Glass in 2013, the company has said, and it’s a perfect chisel to pry Apple fans out of the iOS ecosystem. But Apple is countering with iWatch, conceivably. Both will stimulate an explosion in apps designed either to work with them or on them.

“We’re certainly looking at wearables,” Orr said.

photo credit: schnaars via photopin cc

SAN FRANCISCO — Today, Wooga revealed for the first time in its four-year history that it turned a profit. Revenues are split evenly between mobile and web games.

The Berlin-based developer is a private company, so it wouldn’t go into further detail about its financial situation. Chief executive Jens Begemann (pictured above) added that “we don’t want to be chased” by quarterly results. It’s investing the money back into the company to “innovate” in new genres and grow its audience.

“I’m focused on our 20-20 vision to make games available to [people who] play games every day,” he said.

Wooga targets devices with more than 1 billion users. When Begemann and his cofounders started in 2009, that platform was the PC. More specifically, it chose Facebook — since then, Wooga has become the third-largest social gaming company on the site. The company shifted its focus to mobile when smartphones crossed the 1 billion mark. And in just two years, Begemann believes that tablets will also join the club.

But the company isn’t waiting around, as some of its games are already available on the iPad. In March, it will release a version of the popular gem-matching game Diamond Dash to Amazon’s Kindle Fire.

Wooga currently has 50 million active monthly players across all of its platforms and products.

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July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Amazon needs to make only $3 a month on apps or content from each Kindle Fire it sells in order to generate a 20 percent profit, according to new estimates from ABI Research.

Amazon sells Kindle Fires below cost, and it’s been this since 2011. The razor-and-blades plan seems to be: Give away the device and make it up on digital content, such as books, movies, apps, and more. But positive results of this strategy have not been easy to see in the company’s quarterly reports, with Amazon having losses or just small profits for the last four quarters.

However, the plan may be starting to work, and it has prospects for getting better over time.

“Considering the probable margins of app and content sales, our research shows that Kindle Fire is a credible proposition,” senior ABI analyst Aapo Markkanen said in a statement. “We expect that there will be a certain level of ‘innovation plateauing’ in mobile hardware taking place over the next five years, and that would certainly work in Amazon’s favor. Its future devices are likely to require less cross-subsidy than the ones we’ve seen so far.”

But Amazon like isn’t making money on the Kindle yet, Markkanen told me.

“They need more scale, more revenue, and more margin,” he said. “For example, with Amazon Prime, Netflix only recently got margins to 10-15 percent — and Amazon Prime is still around 5-10 percent.”

There are signs of that happening soon, however, according to ABI, perhaps as early as 2014.

The Kindle Fire is by far the leading Android tablet on the market, having sold perhaps six million units last Christmas and capturing significantly more marketshare than other Android tablet during the holiday. All that hardware sold below cost is part of what is making Amazon’s margins so thin. According to Markkanen, that’s a defensive strategy to ensure that Apple and Google do not own its customers and present a barrier to Amazon’s growing digital commerce.

The question is: How much could all that digital commerce be worth?

Exact sales figures on Kindle are hard to get — mostly since Amazon does not release them. But the company did say Kindle Fires accounted for 22 percent of the U.S. tablet market in 2012, and the Kindle Fire seems to compete well against the iPad Mini. ABI calculates the Kindle Fire installed base as between 11 million and 12.5 million units as of the end of 2012, which could then translate to some $400 million a year in sales. That’s revenue up in the Amazon Web Services area. But it’s not here yet.

And of course, Amazon’s strategy is not just about its own hardware — it’s also on every other platform. In fact, Markkanen estimates that Amazon has amassed about 180 million downloads from the iOS, Windows Phone, and Android app stores for its Kindle, Price Check, and other apps.

Image credit: Amazon

But according to new data that app analytics service Localytics is publishing tomorrow, that’s not what’s happening. Rather, the big tabs are getting the lion’s share of the market, increasing their lead on other tablets.

That’s especially true for Amazon’s Kindle Fire and Samsung’s stable of tablets.

For example, the number of Amazon’s 7″ Kindle Fires that Localytics saw grew 322 percent from November to the end of December. Samsung’s Galaxy Note II grew 80 percent, it’s popular Tab 2 10.1″ tablet grew 78 percent, and the smaller Tab 2 7″ grew 72 percent. The Nook also grew, though not as swiftly, picking up an additional 62 percent.

Localytics provides data on user behavior for tens of thousands of apps that were installed on over 60 million devices as of mid-2012, which should form a significant enough sample size to at least be indicative of what’s happening in the market. Each device that runs any app that uses Localytics’ services registers as a unique devices in the company’s numbers.

The data also showed a move in iDevice market share. According to the company, the iPhone 5 now constitutes 18 percent of all iPhones in use, with the 4S still retaining the crown of most popular iPhone, with 40 percent of the market.

And the new iPad mini? Localytics’ data suggests it’s selling a little slower than the iPad 4, with the 4th-generation iPad clocking in at about eight percent of the overall iPad market, and the mini picking up six percent.

We’ll know for sure if those numbers are accurate in just a couple of weeks, when Apple reports its Q1 2013 results.

Kindle Fire tablets can get viruses, too. That’s why the team at Lookout Mobile just launched its first app for the Amazon-made tablet today.

Lookout has existed since its beginning as an Android application, the same operating system the Kindle Fire runs on, but Amazon’s tablet does not support Google Play. The app is the same as the standard Android version, tweaked to fit the Kindle Fire and Kindle Fire HD screens.

Lookout was founded in 2007 and competes with big-name security companies such as McAfee and Symantec’s Norton to protect mobile devices from malware, malicious links, and other threats. Once you install the app, it will alert you to hidden viruses, track the location of your phone, and let you remotely turn on a “scream ringtone” if it’s lost. It also acts as a backup measure, saving your contacts to your Lookout account accessible online.

Recently, the company has been expanding its reach to new devices and through new partnerships. T-Mobile will be pre-loading Lookout onto a number of its Android phones prior to distribution, as will French telecommunications provider Orange.

The company is based in San Francisco and has thus far raised $76.5 million from investors including Andreessen-Horowitz, Khosla Ventures, Trilogy Equity Partners, Accel Partners, Index Ventures, Chris Sacca, and others. Lookout also has a version of its app for iOS devices.

Kindle Fire image via Amazon, Lookout Mobile image via Lookout

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

What a shock: Google Maps is not going to be available on Amazon’s Kindle Fire tablet. Instead, Skobbler is launching ForeverMap 2 on Kindle Fire — and Nook – to take its place.

The Berlin-based company builds mobile navigation products based on OpenStreetMap data. And it sees a major opportunity in the obvious mapping void on probably the most popular non-iPad tablet platform.

“Amazon’s devices do not include pre-installed maps, and Google Maps isn’t even available,” said Skobbler co-founder Marcus Thielking in a statement. “We offer Kindle Fire users a solution that’s second to none in the Amazon App Store.”

Amazon can hardly expect Google to provide a mapping solution for Kindle, of course.

The giant online retailer and service provider has legally and ethically hijacked Android, the mobile operating system created by Google, to create Kindle, neatly excising Android’s links and hooks to Google services and replacing them with Amazon’s own content ecosystem. Google can’t feel good about that and so far hasn’t deigned to offer its apps on Amazon’s app store.

So Skobbler has jumped into the void.

And the company is offering an extremely interesting product: an open-source map built by 900,000 volunteers that is free for online use, with over 1,000 in-app purchases available at $0.99 and up that buy offline map access for cities, states, and countries. Cities are $0.99, states are $1.99, countries are $2.99, and continents are $5.99. Alternatively, for $9.99, Kindle Fire users can purchase complete and unlimited offline accessibility to all global maps.

In other words, it’s a great option for travelers who don’t want to pay cellular fees for data and roaming.

OpenStreetMap is a crowdsourced mapping project — a Wikipedia for maps — which Apple used in iPhoto at one point, FourSquare and other location-based social networking and mapping apps use, and some, including Thielking, believe will eventually surpass both Google and Apple’s current mapping solutions.

Nokia also provides a mapping solution on Kindle Fire, but Thielking says it is “extremely limited,” with insufficient detail and coverage.

ForeverMap 2 will be available on Kindle Fire and Nook later today.

photo credit: Oscar_Shen via photopin cc

Amazon’s line of Kindle readers are undoubtedly popular among consumers this holiday season, but it’s difficult to determine exactly how many have sold.

Today the company released new information about Black Friday and Cyber Monday sales data that vaguely indicate that Kindles are selling well — without actually stating any hard sales numbers.

For instance, Amazon stated that Cyber Monday was “the biggest day ever for Kindle sales worldwide” and “Kindle Fire HD is the most gifted and most wished for product on Amazon worldwide since launch.” (See the full list of “milestones” below.)

It’s really hard to tell whether Amazon is actually breaking sales records with its refreshed line of Kindles, or if the company is once again playing cheerleader for its own products as a way to avoid disclosing possibly lackluster results. Unlike last year, Amazon doesn’t have the benefit of selling its Kindle devices inside two of the largest physical retailers, Walmart and Target.

Amazon was a little more forthcoming with sales data last holiday season, and released enough data that suggested it sold about 5 million Kindle Fires. Yet overall, Amazon has been notoriously vague about its Kindle sales.

It’ll be interesting to see how shareholders will react if Amazon once again decides to stay silent about Kindle sales (broken down by tablets and e-readers), digital sales, and digital sales through Kindle devices.

Amazon’s Kindle “milestones”:

• Cyber Monday 2012 was the biggest day ever for Kindle sales worldwide.
• The top 4 spots on the worldwide Amazon best sellers list since launch nearly three months ago are Kindle e-readers and Kindle Fires.
• To celebrate Cyber Monday, Amazon.com offered a special deal—just $129 for the Kindle Fire. Customers flocked to the deal, making this the biggest Cyber Monday deal ever for Amazon.com.
• Kindle Fire HD is the most gifted and most wished for product on Amazon worldwide since launch.
• 9 out of the top 10 best-selling products on Amazon worldwide since 9/6 are Kindles, Kindle accessories and digital content.

Photo by Jennifer Van Grove/VentureBeat

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

iPhones and iPads may be losing ground to Android-based smartphones and tablets, but iPad is still king of online content. And online sales.

According to an IBM report on Black Friday commerce, 16.3 percent of online sales happened via mobile devices. And more than half of that volume — nearly 10 percent of all online sales — occurred on iPads.

That’s a fairly stunning figure: 10 percent of all online sales on Black Friday from iPad alone. But it gets more astonishing when you compare it with other tablets in the market. Of all tablet traffic to online retailers’ sites, iPad captured almost 90 percent of tablet traffic:

1. Apple iPad: 88.3%
2. Barnes & Noble Nook: 3.1%
3. Amazon Kindle 2.4%
4. Samsung Galaxy Tab: 1.8%

That’s pretty much right where iPad was last year, in November 2011, when we thought Kindle Fire might start to eat some of iPad’s lunch. And it’s more than iPad’s overall traffic share as measured just a month ago by OnSwipe.

Source: IBM

Online sales and traffic from mobile devices were up 65 and 68 percent, respectively

Apple devices were popular overall on Black Friday, as iPhone was second behind iPad, with another 8.7 percent of all online shopping. Android devices — phones and tablets — totaled only 5.53 percent.

Based on the data from its digital analytics product suite, IBM put this Black Friday infographic together:

photo credit: Johan Larsson via photopin cc, Hat tip: Mashable

The iPad Mini is proof positive why technical specs don’t matter anymore. It’s slower than both the third and fourth-generation iPads, and it features a significantly lower resolution screen that doesn’t even meet HD video standards.

And yet, its miniscule size and overall convenience makes it the best iPad I’ve ever used and the best tablet on the market.

The original 9.7-inch iPad basically created the modern tablet market, and Apple’s iPad line still accounts for more than 50 percent of new tablets sold (according to IDC). But I’ve never felt truly comfortable using any iPad for prolonged periods of time — and the same goes for every other tablet I’ve used that’s around 10 inches. They’re tough to hold with one hand, and even with two hands, it’s not exactly effortless to hold large tablets for hours on end.

Smaller tablets don’t have any of those issues. You can throw a small tablet in a bag and forget it’s even there, and they’re generally light enough to hold with little effort, like a paperback book. Given their size and flexibility, they’re naturally more focused on content consumption.

With its 7.9-inch screen, the iPad Mini is slightly larger than its 7-inch Android counterparts. But it still has all the makings of a small tablet, and that extra screen real estate actually makes it far better for reading.

Apple has struck a balance between size and performance with the iPad Mini — and it’s one that will resonate in the tablet market for years to come.

The good: Smaller really is better

I can go on and on about the iPad Mini’s thinness and lightness — but really, you have to hold this thing to understand why it’s so special. At just .68 pounds and 7.2 millimeters thick, it weighs about the same as a typical paperback book, and it’s thinner than the already ridiculously thin iPhone 5.

Holding the iPad Mini makes it clear that the sheer size of standard iPads are an issue, even though that didn’t stop more than 85 million consumers from making that tablet a huge success for Apple.

For a device that we’re holding in our hands most of the time, it makes sense that being more comfortable trounces having the better hardware. Together with the Nexus 7 and Kindle Fire, the iPad Mini shows that smaller tablets are the ideal tablets.

The obvious benefit of going small is cost: The iPad Mini starts at $329, making it the cheapest iPad option yet. It’s still significantly above its $200 Android competitors, but the higher price is well worth the bigger and better iPad app ecosystem. Apple’s decision to go with a 7.9-inch screen also makes the iPad Mini more versatile than 7-inch tablets — you can see more content from web pages, and games feel as if they have more room to breathe.

It’s almost as if the bigger iPads are just a beta test. It was likely too difficult for Apple to successfully build something like the iPad Mini back in 2009 — for one thing, hardware components probably weren’t small enough (just look at how thick the first iPad was). And while the bigger iPad isn’t going anywhere any time soon, the unceremonious way Apple revealed the fourth-gen iPad alongside the iPad Mini is telling.

Over the next few years, expect far more innovation from the iPad Mini than the standard iPad.

For me, great technology should be both uncompromising (which Microsoft’s Surface, sadly, wasn’t) and effortless. The iPad Mini hasn’t cracked the uncompromising nut just yet (more on that below), but it’s by far the most effortless tablet I’ve ever used.

Even though it has a bigger screen, the iPad Mini is 32 grams lighter (for the Wi-Fi model) and noticeably thinner than the Nexus 7, which has been my favorite small tablet so far. Ultimately, this means that everything — reading, watching a movie, or playing a game — simply feels better on the iPad Mini because it’s not a chore to hold. It also helps that the tablet feels so solid — you can feel all of Apple’s experience with building the iPad and iPhone in the iPad Mini’s strong body.

Movies and games don’t look as sharp as they do on Retina Display-equipped iPads, but it’s a more than worthy tradeoff. It takes a discerning eye to notice the benefits of Apple’s Retina Display, but anyone can immediately recognize how much more convenient the iPad mini is. (And naturally, that’s a problem that will be fixed in future models when Apple brings Retina Display quality to the iPad Mini.)

With the iPad Mini, you’ll never think twice about taking it along when you leave the house or grabbing it to peruse Twitter while watching TV. And the device itself becomes practically invisible as you use it.

In the end, isn’t that exactly what a tablet should be?

The bad: Yes, we’re evolving backward (for now)

The iPad Mini is basically running the same hardware that powers the iPad 2. It has the same dual-core A5 processer and 512MB of RAM. And for the screen, instead of the lush Retina Display resolutions of 2048 by 1536, we get the same 1024 by 768 resolution we were so happy to run away from two years ago. (Since the iPad Mini’s screen is smaller, its resolution still looks sharper than on previous iPads.)

It’s difficult to recommend the iPad Mini to someone who’s already shelled out for a third-gen iPad. But in my experience, I still end up reaching for the Mini more than the sharper-screened iPad.

For most of the apps I’ve used — including Twitter, news readers apps like Pulse, and Instagram — the iPad Mini performed admirably. Games suffered the most with the older hardware, but most consumers won’t notice the slightly lower-res and less-detailed graphics, even with graphics-heavy titles like Infinity Blade 2.

It’s a shame that Apple couldn’t at least deliver a Retina resolution, but this makes sense. It would have required a more powerful processor and graphics capabilities, which probably would have made the price of the iPad Mini even higher. For now, it’s a tablet that’s ideal for most consumers — but those looking for Retina sharpness should wait for the inevitable upgrade in next year’s model.

The verdict: The best iPad experience yet

The iPad Mini is all about tradeoffs. Instead of a sharp Retina screen and powerful hardware, you’re getting a slimmer device that’s far more convenient. For me, the tradeoffs are worth it.

Big tablets certainly have their place, but I think we’ll see those becoming increasingly specialized. Most consumers would be better off with the size and price of the iPad Mini than splurging for the iPad fourth-gen. And as for big Android tablets, the Nexus 10 is really the only one worth considering.

I’ve been recommending the iPad Mini without hesitation over the past week. If you’ve been holding out on getting a tablet, it’s almost a no-brainer. You can save a bit by going for the $200 Nexus 7, but you’ll be giving up a far better tablet app ecosystem.

If you can’t swallow the compromise with the iPad Mini, then hold off until next year’s update. And if you already own one of the Retina Display iPads, then you’re probably better off waiting as well (or just starting pricing your iPad on a gadget reseller service like Gazelle).

If anything, I feel vindicated by the iPad Mini. Here’s a device that proves, once and for all, that smaller slates are far better at fulfilling the promise of tablets.

Amazon’s third quarter earnings just hit, and weirdly enough, the online retailer/hardware manufacturer reserved a decent chunk of its report to rail on the just-announced iPad mini and explain why its Kindle Fire is better.

Clearly, Amazon is a bit freaked out by Apple’s latest product, which starts at $330 and might be more palatable to average consumers than the $500 base price of the full-size iPad.

Both of Amazon’s newest Kindle Fire units cost even less. Amazon writes:

Highlights

• Compared to the iPad mini, Kindle Fire HD 8.9″ has: 193% more pixels (2,304,000 pixels vs. 786,432 pixels)
• 56% more pixels-per-inch (254 vs. 163)
• Watch HD movies and TV – cannot on iPad mini (iPad mini is an SD device)
• Better audio with dual stereo speakers and Dolby Digital Plus
• Wi-Fi with dual band, dual antennas + MIMO
• Costs $30 less
• Compared to the iPad mini, Kindle Fire HD 7″ has: 30% more pixels (1,024,000 vs. 786,432 pixels)
• 33% more pixels per inch (216 vs. 163)
• Watch HD movies and TV – cannot on iPad mini (iPad mini is an SD device)
• Better audio with dual stereo speakers and Dolby Digital Plus
• Wi-Fi with dual band, dual antennas + MIMO
• Costs $130 less

Shareholders were not impressed with Amazon’s results or its pleas about how much better the Kindle Fire HD is than the iPad mini. Its stock was trading down about 9 percent in after-hours trading, but it is now down about 2 percent.

Jeff Bezos photo: Jennifer Van Grove/VentureBeat

The news of the day in the tech world was once again focused on Apple. Venturebeat has coverage of the new iMacs, Mac minis and MacBooks. However, the main event was the iPad mini.

If you are reading this, then by now you are familiar with the features of the new tablet: its Lightning port, its ultra-thin design, and Jony Ive’s diamond-studded chamfers. However, I think there are some important industry implications for this device and the way it was priced. Last month, I pointed out how difficult the hardware market has become, and the mini looks set to drive that process along.

After years of talking down 7-inch tablets, Apple changed course. What does the company hope to gain? I think the answer is market segmentation. This is one of those “MBA 101″ topics: Divide the market into multiple pieces and sell products in each. Apple risks seeing some people who would have bought a larger device opting for the less expensive mini now, but it must believe that it will sell an even larger total number of devices.

I see two pieces to this strategy: one internal to Apple, the second as a major weight on the industry.

Draw out a number line from $0 to $800, with tick marks every $50, then write down the Apple product at each marker. The new mini fits into several gaps. The base 16 GB mini sits well below the now-discontinued iPad 2, and in between the iPod Touch 32 GB and 64 GB. Put simply, Apple had room for more products here. It risks losing some low-end iPad units and probably some high-end iPod Touch sales, but it has created a whole new category for its offerings.

Apple deserves credit for its originality: After all, it basically invented the smartphone market (yes, Windows Mobile, I remember you). But this does not mean it does not learn from its competitors. It has become clear over the past nine months that there is consumer demand for 5- and 7-inch devices. Samsung, for example, seems to be doing very good business with its seemingly mammoth 5-inch Galaxy Note, a phone that edges into tablet territory. Like many, I was skeptical at first about this product, but it turns out Samsung was onto something. The Note is too big for most people’s pockets, but Samsung has done its homework. It has successfully marketed these devices to women who carry the Note in their purse. I had this point driven home to me last month, when I saw the entire crew from Asiana Airlines Flight 213 in a hotel lobby. All 25 of the flight attendants were carrying 5-inch or larger devices. Amazon and Google have also done well with the Kindle Fire HD and Nexus 7, respectively — although they are ‘doing well’ by a different set of metrics than the iPad.

So Apple saw an opportunity and made its play. It is too early to tell how many minis it will sell, but I think Apple should have a very good Christmas this year.

The same is not true for other hardware makers. For years now, Apple has been effectively capping the prices its competitors can charge. So far, no tablet priced even close to the iPad has done well. The best-selling non-Apple tablets today are all priced at or below $200. Apple products command a premium, that has been true for phones, for tablets, and for laptops for many years. The iPad mini, priced at $329, pushes the prices even further down for everyone else.

When Google launched the Nexus 7, Android management bragged about how little money they were making on the device. That could not have been good news for Google’s hardware partners. Android’s goal is to spread its OS and the Google API as widely as possible. Its hardware partners’ profits seem to be a much lower priority. Amazon, for its part, has charged rock-bottom prices for its tablets, but that is part of its strategy of profiting from selling content, not the hardware itself.

I made some comparisons about the profitability of the various tablets out there. I used iSuppli’s teardowns for estimates of the cost of the iPhone, iPad, Kindle Fire HD and Nexus 7. This is just iSuppli’s estimate, and not everyone agrees, but I think they have a pretty good track record, and are at least close enough. I also made a guess as to the iPad mini’s costs.

By this analysis, it is pretty clear that only Apple is profiting from tablet hardware sales. Amazon may even be losing money.

One interesting fact that comes out of this data is how much we are all paying for memory. This is the one favor Apple has done the industry. Apple charges $100 for each bump in memory. A 16GB iPad Mini is $329, a 32 GB version is $429. The other vendors have mostly followed this pattern. My estimate is that 16 GB of NAND Flash costs about $10, and iSuppli quotes a similar amount. Apple buys so much, it may actually pay even less. That’s a 90 percent gross margin for Apple, comparable to the kinds of margins you ordinarily see for software, i.e. products which have no cost of goods sold. By comparison, most hardware businesses are happy to capture 30 percent gross margins. Apple’s corporate average gross margin is in the 40s.

By my admittedly rough math, almost all the profit Amazon sees on the Kindle or Google/Asus see on the Nexus 7 comes from their mark-up on memory. It will be interesting to see if Apple someday changes its pricing model to make even that slice difficult for its competitors.

Yet even with those healthy memory margins, the other tablet makers do not make much money.

I think this will get even worse. You can now buy a $45 Android tablet in China and an $80 version in the US. This means that even those $200 levels we see today will fade soon. By contrast, Apple has kept prices for its high-end iPads constant.

All of this matters a lot. Apple and Samsung are the only smartphone makers generating a profit today. Market share and revenue look nice in PowerPoint and press releases, but profits are what sustain investment in the future.  And there are far fewer of these to go around.

Jay Goldberg is a financial analyst with an investment bank. He has been working with tech companies for ten years. Prior to that he lived and worked in China for almost 10 years. His previous post for VentureBeat was about how hardware is dead.

Top photo: VentureBeat

Today Apple announced its 7.9-inch iPad mini tablet. Right on stage, the company compared it to the Nexus 7 (Google’s flagship Android tablet) to show the wealth of differences between the two. But Apple skipped a few key comparisons that you might want to be aware of.

Here’s a closer look at those differences, as well as how Amazon’s Kindle Fire HD tablet compares to both:

The iPad mini is without a doubt the thinnest tablet ever produced. It’s thinner than most smartphones today at just 7.2 millimeters thick. It’s slightly taller and wider than most competing 7-inch tablets, though not the Kindle Fire HD.

From my time with the Fire HD, I’ve found that holding it from edge to edge with one hand is possible, though not comfortable — so the iPad mini should be comparable.

The iPad mini is also the lightest tablet available, although the upcoming Barnes & Noble Nook HD tablet will weigh just seven grams more at 315 grams.

Processing power, based on the specs alone, appears fairly similar, but specs don’t tell the whole story. The A5 processor inside the iPad mini is identical to the one inside the iPad 2 — which is now one and a half years old — compared to the newer processors inside both the Nexus 7 and Kindle Fire HD. On the other hand, the Android tablets may be faster and offer double the RAM, but Apple’s current operating system (iOS 6) is better suited for the included components, which makes it better at processing data more quickly and more efficiently. Google constantly updates its operating system to improve speed and efficiency; Amazon historically has not.

At the iPad mini’s unveiling in San Jose today, Apple’s Phil Schiller (Senior VP of Marketing) also mentioned how it feels much better than the Nexus 7, primarily because the Android tablet is made of plastic and feels cheap. I haven’t found that to be the case. The Nexus 7 is the best 7-inch tablet to hold because of a well-designed case that is easy to grip and feels warm in the hand. The Kindle Fire HD has a rubber-like back, which is also comfortable and warm. The iPad mini has a metallic back panel. I expect that it will be similar to the current iPad, which feels cold in the hand but provides good grip. I prefer the warm Nexus 7 to the iPad, though size and weight have to be considered as well.

The iPad mini is available in three capacity variations: 16GB, 32GB, and 64GB. The Nexus 7 starts with just 8GB, which in my use is completely inadequate. A 16GB model is also available, and 32GB models have been found in stores across the US. The Kindle Fire HD comes in 16GB and 32GB capacities.

All of the tablets use a 1.2 megapixel (MP) front-facing camera that can record video in 720p, but the iPad mini is the only tablet here that includes a rear-facing camera. That 5MP camera is likely the same found in the latest iPod Touch and the iPhone 4. Tablet cameras have traditionally offered mediocre to poor still photography and video recording, but larger 10-inch tablets have shipped with significantly improved cameras this year.

Most 7-inch tablets feature widescreen (16:9) displays, but the iPad mini has the same 4:3 aspect ratio as the full-sized iPad. This means all HD video on the iPad mini will be letterboxed with black bars at the top and bottom of the screen. The Nexus 7 and Kindle Fire HD both have denser displays at significantly higher 720p resolutions, which will make HD media appear clearer and without letterboxing.

All of the tablets use high-quality IPS displays, but the iPad’s lower resolution and larger screen will make pictures appear blurrier and more pixelated. It’s surprising Apple didn’t include a Retina display on the iPad mini for exactly this reason.

Apple boasts the same 10-hour battery life on the iPad mini as on the iPad, though the Kindle Fire HD promises 11 hours of continuous use. As with any manufacturer’s promised battery life, take these numbers with a big grain of salt.

The iPad mini is also the only small tablet that can access fast LTE 4G cellular data. LTE will be available on the iPad mini in the US through Verizon, AT&T, and Sprint, for an extra $130 over the comparable Wi-Fi models.

The biggest difference between the iPad mini and all competing Android tablets is the price. The starting price for the iPad mini is $330, $130 more than both the starting Nexus 7 and the Kindle Fire HD. The iPad mini also increases the price in $100 increments for doubling the memory, compared to Amazon, which only charges $50 more for the 32GB  model.

Additionally, other tablets like the Nook HD offer expandable memory through user-purchased memory cards; the iPad mini doesn’t.

In short, the iPad mini is far more expensive than the competition at equivalent capacities, and only gets more expensive as the capacity increases. In fact, the iPad mini is expensive even compared to the latest iPod Touch, which has all of the same internal components as the iPad mini.

Will you buy an iPad mini? Tell us what you think about it in the comments section below.

Apple products are usually big hits, which helps.

But more importantly, they punch above their weight for content consumption. For example, even though Android smartphones have been outselling iPhones for some time — accounting for 68 percent of smartphones sold in the second quarter of 2012 — it was only in the last week or so that Android phones finally outpaced iPhones for mobile web share.

Most importantly, mobile marketing experts Velti say, mid-size tablets perform much better for advertisers.

For example, tablets in general have two times the clickthrough for full-size ad interstitials, a fact that Velti says is due to rich media ads achieving higher engagement due to the larger display. But within tablets, the 7″ midsize is even better. The Amazon Kindle Fire clickthrough rate for large banner ads is more than double iPad 3′s and about 50 percent higher than the Samsung Galaxy Tab’s.

Velti says that the lower price Android tablets, including mid-sized versions, brought in new tablet purchasers last year. It’s likely that a smaller and cheaper iPad will do the same.

That all adds up, according to Velti, to potentially the most successful mobile device for consumer engagement with mobile marketing.

photo credit: la legra negra via photopin cc

Amazon is rolling out an update today for the Kindle Fire HD that will enable Kindle Freetime, a previously announced feature that gives kids a safe environment to read, watch, and play.

With today’s announcement, Amazon also boasted that the Kindle Fire HD was its best-selling product worldwide (continuing the trend of the original Kindle Fire).

So what exactly does Kindle Freetime offer? Using the new feature, parents will be able to pick and choose the content their child interacts with, or limit available media by content type. Kids won’t be able to leave the restricted interface without a password. Parents can also enforce a time limit, after which the Kindle Fire HD’s interface goes blue.

The update comes after criticism over a lack of parental controls in the original Kindle Fire — not exactly a smart move, since kids are quick to grab shiny new devices and parents are probably less concerned with kids handling it since it only costs $199. Amazon eventually updated the original Kindle Fire in May to add some basic parental controls.

Amazon will begin shipping its larger tablet, the Kindle Fire HD 8.9″, for $299 on November 20.

Photo via Jennifer Van Grove/VentureBeat

Something special is going on with 7-inch tablets like the Nexus 7 and Kindle Fire. Not only are they cheaper than full-sized 10-inch tablets at $200, but their smaller size also seems to be encouraging consumers to engage more with websites.

In particular, 7-inch tablets are leading to 20 percent more pageviews for publishers, and e-reader-first tablets like the Kindle Fire are also encouraging consumers to spend more time on websites, according to data provided to VentureBeat by OnSwipe, a company that optimizes sites for tablets and smartphones.

The data is particularly interesting now that we expect Apple to reveal its own small tablet, the iPad Mini, at a press conference next week. Apple’s late founder Steve Jobs dismissed the idea of small tablets years ago — but strong sales of the Kindle Fire and Nexus 7, as well as Apple’s own entry into the small tablet arena, prove that they’re intriguing to consumers.

“The 7 to 8-inch tablet is completely in the zone for content consumption, whether it’s a book or it’s the web; whatever the activity, it’s just more encapsulating,” said OnSwipe chief executive Jason Baptiste in an interview with VentureBeat. “The iPad, meanwhile, could replace the PC on the couch.”

For fully-featured 7-inch tablets like the Nexus 7, OnSwipe found no difference in on-site engagement time. But given what I’ve seen from mainstream small tablet owners, as well as my own habits with the Nexus 7, consumers are more likely to bring them along when they step out of the house versus larger tablets. I’ve also found that smaller tablets are much more comfortable for reading long text pieces, primarily because they’re easy to hold with one hand.

When it comes to small tablets focused on e-reader capabilities first, like Amazon’s Kindle Fire, OnSwipe found that users stayed on sites around 36 percent longer than they did on the iPad, and around 30 percent longer than they did on the Nexus 7. The company attributes that to Kindle Fire owners being used to reading books, magazines, and other text-heavy content on their devices.

While Amazon kicked off the cheap and small tablet craze with last year’s Kindle Fire, it’s going to see much more of a battle this year now that it’s contending with the Nexus 7 and potentially the iPad Mini. But no matter who rises to the top, publishers should expect to see better engagement. And perhaps they should consider spending a bit more time optimizing for smaller tablets.

Photo: Devindra Hardawar/VentureBeat

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

iPad Mini models and prices have been revealed by someone with access to the internal system of Europe’s largest electronics retailer, Media Markt.

According to the screenshot, there will be 16 different iPad Mini configurations, starting at an 8GB WiFI model for approximately $250 U.S., rising to a 64GB version with cellular — presumably including 4G LTE connectivity as well as 3G.

The prices are an interesting comparison to an iPod Touch, which starts at $299 for 32GB, an iPad2, which starts at $399 for 16GB, and the newest retina iPad, which begins at $499 … all of which will force consumers to think hard about the exact mix of portability and product they want when purchasing. And they provide Apple a tablet price point at least within shouting range of Amazon’s we-sell-at-cost Kindle Fire, at $159.

But, in a very Apple-esque move, they are not aggressively challenging the $200 mark.

Here are the models, which anyone who’s looked at the current iPad versions will recognize. For each I’ve roughly translated the price from Euros to U.S. dollars, minus Germany’s 19 percent value-added tax.

• 8GB WiFi Black/White, $250
• 8GB Cellular Black/White $350
• 16GB WiFi Black/White $350
• 16GB Cellular WiFi Black/White $450
• 32GB WiFi Black/White $450
• 32GB Cellular Black/White$550
• 64GB WiFi Black/White $550
• 64GB Cellular Black/White $650

This is the screenshot, from a German blog. If you want to read the original, but don’t speak German, Google Translate is somewhat helpful.

Source: Flo's Weblog

iPad Mini models and prices

October 23rd seems to be the day for the big announcement, two days before Apple’s quarterly earnings will be released. Assuming these numbers are correct, we’ll see then what kind of value Apple is packing into the iPad Mini in return for $250 to $650 dollars.

photo credit: methodshop.com via photopin cc

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Looking for a Kindle? Well, you won’t find one in the country’s largest retail store chain anymore.

Walmart will stop sales of Amazon’s entire line of Kindle devices. This is effective immediately, reports Reuters. That includes all Kindle e-readers as well as the Kindle Fire and new Kindle Fire HDs. This move not only includes the big box Walmart stores but also its membership-only chain, Sam’s Club.

“We have recently made the business decision to not carry Amazon tablets and eReaders beyond our existing inventory and purchase commitments,” Wamart stated in a memo to store managers yesterday.

Searching for Kindle on both Walmart and Sam’s Club official websites is currently returning zero results, which could indicate that the online store fronts are also halting sales.

The move is not at all surprising, considering that Amazon’s online store sells a variety of items you can typically find in Walmart. The Kindle Fire itself acted as a “trojan horse” of sorts for Amazon by enticing people to shop online via tablet rather than go into a brick and mortar store to make a purchase. I’d imagine Walmart wasn’t making any money off of Kindle sales, either.

Walmart is the second big box retailer to boot Amazon’s Kindles out of its stores, with the first being discount-chain competitor Target back in May.

I’m curious to find out if the lack of retail presence on retail shelves will affect Kindle sales heading into the 2012 holiday season. (Coincidentally, I purchased a Kindle for my Dad last Christmas, but only after waiting in a substantial line of people who typically wouldn’t make it into an electronics store. Walmart employees actually had to explain each product and offer a short demo before the three people ahead of me ended up purchasing something.)

Photo via Walmart Corp./Flickr

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Amazon’s slick new 7-inch Kindle Fire and Kindle Fire HD tablets are now available to purchase online.

Just last week, Amazon CEO Jeff Bezos took the stage in Santa Monica, Calif. to debut new Kindles, including a Kindle Paperwhite e-reader, a refreshed Kindle Fire, a 7-inch Kindle Fire HD, and an 8.9-inch Kindle Fire HD.

While we’ll have to wait until Nov. 20 for the 8.9-inch Kindle Fire to ship, Amazon’s 7-inch tablets and new $69 Kindle e-reader are here today. If you want the absolute lowest price for a decent color tablet, the $159 Kindle Fire is worth a look. But if you’re willing to pay up just a bit more, the $199 Kindle Fire HD and Google’s Nexus 7 are the two best 7-inch tablets we’ve seen yet.

Let us know in the comments if you plan to buy a Kindle from Amazon’s new lineup.

Kindle Fire HD photo: Jennifer Van Grove/VentureBeat

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

After numerous complaints, Amazon has confirmed that it will indeed let customers opt out of “Special Offers” advertising on the new Kindle Fire HD for $15. It’s a show of goodwill on Amazon’s part, but what was with the mixed messages?

“With Kindle Fire HD, there will be a special offers opt-out option for $15,” Amazon said in a widely circulated statement. “We know from our Kindle reader line that customers love our special offers and very few people choose to opt out. We’re happy to offer customers the choice.”

From the looks of it, Amazon didn’t think it would be a big deal if its Kindle Fire HD served ads because “very few” Kindle owners opt out of Special Offers. However, with the confusion and mixed messages, it’s almost as if Amazon decided to test if there would be a freak out over not offering an opt out. Once angry customers and tech pundits spoke up, Amazon caved to their requests.

To be fair, the reason many folks (including me) haven’t opted out is that Special Offers aren’t that obtrusive and only show up on the lock screen. Unlocking the screen takes a split second, so I don’t even have to look at the ad.

But it’s always better to give customers the option to ditch advertising, so Amazon is doing the right thing and giving customers a way out by paying $15 — just like it did with the first Kindle Fire. Advertising is included to subsidize the price of the tablets, and Amazon could eventually make a lot of money advertising on millions of large, colorful home screens. But it’s better to keep customers happy by giving them an option they probably won’t take.

The Kindle Fire HD will be released on Sept. 14, while the Kindle Fire HD 8.9″ Wi-Fi and 4G models are expected to ship on Nov. 20.

Kindle Fire HD photo: Jennifer Van Grove/VentureBeat

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

This post was written by entrepreneur and academic Vivek Wadhwa.

The high definition screens, faster processors, and enhanced Wi-Fi capabilities of Amazon’s new Kindle Fire tablets are making big news. The price of these devices is getting even more attention: $199 for the 7-inch and $499 for the top-of-the-line 8.9 inch 4G LTE-enabled models. Amazon will undoubtedly sell millions of these.

But I’m not excited.

Here’s why: These tablets won’t catalyze the revolution that is waiting to happen. The magic will happen when the price-per-unit drops below $100 on its way towards $50. That’s when hundreds of millions—possibly billions—of units will be sold and impact people in all parts of the world.

That’s exactly what happened when cell phone prices dropped to this level. India and China both have close to a billion mobile subscribers today. Cisco estimates that by the end of 2012, the number of mobile-connected devices will exceed the number of people on Earth and that by 2016 there will be over 10 billion mobile-connected devices — or 1.4 mobile devices per capita. These phones have dramatically impacted commerce, health, and social interactions all over the world. Villagers in the most remote parts the world are now connected. These have also aided uprisings in the Middle East and China.

Internet-enabled tablets will take connectivity to the next level. The world’s billions will have access to the same torrent of unlimited knowledge that we do. They will be able to get the same news, have access to the same online learning tools, engage in the same discussion groups, and participate more equally in the global economy.

The magic won’t just happen abroad. There are revolutions waiting to happen in the United States. Today, tablet devices are typically used to play games, search for information, send emails, read books and news, and to engage in social networking. You occasionally see iPads being used as electronic kiosks in retail stores. When the price point for tablets drops to about $50, you will see them everywhere. Just as happened with apps on iPhone’s and Android devices, there will be new uses of technology that we can’t even imagine. You will see these devices in grocery stores, where they will help you find what you need and decide what to buy. You’ll see them increasingly in restaurants to help you decide what to order and in schools to revolutionize education.

The technology already exists to create sub-$100 tablets, but without the high-definition retina displays, superfast processors, and other bells and whistles that Amazon, Google, and Apple are constantly hyping. I would argue that, for most applications, such as the ones I mentioned above, you don’t need these advanced features. The iPhone released in January 2007 blew us away with its screen, speed, and connectivity. Later versions of the iPhone were relatively minor improvements on the original. The iPhone 5, which we expect Apple to unveil next week and possibly ship later this month, will no doubt be nicer, but it is something that we are doing fine without. A tablet device with the level of functionality that earlier versions of the iPhone had, and that were also just fine, could be built relatively inexpensively.

Indeed, India is trying to launch such a product in the form of the Aakash tablet. When it was announced in Oct. 2011, it was billed as the $35 tablet. Development was outsourced to a Canadian company, DataWind. The Indian government’s specifications for this device were so weak that the released product was considered unusable and the project was embroiled in politics. DataWind CEO, Suneet Singh Tulli told me via email Thursday that, despite the delays, a newer version called Aakash 2 will be launched before October. He says it will have significant performance enhancements including a four-point, multi-touch projective capacitive display and a Cortex A8 – 1 Ghz processor. He also says it will run the latest version of Android, provide Wi-Fi and cell phone connectivity, and retail to the public in India for $63. The government is purchasing a version of this for $40 that it plans to subsidize for schools. Tulli says his goal is to market a high-end version of this tablet in the U.S. for a price of $79 early next year.

If it isn’t DataWind, then it surely will be a Chinese manufacturer that floods the market with cheap, disposable tablets. It is badly needed and has to happen. I doubt that Amazon or Apple will willingly go down to this price level because they are focused on high-end, high-profit customers. But regardless of who gets there first, there is a large, worldwide, market at the bottom of this pyramid.

Vivek Wadhwa is a fellow at the Rock Center for Corporate Governance at Stanford University and is affiliated with several other universities. Read more about Vivek Wadhwa’s affiliations. You can also follow him on Twitter — @wadhwa.

[Editor's note: This story previously appeared on WashingtonPost.com]

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Update 9/10/2012 (11:1o a.m. PT): Amazon is now allowing Kindle Fire HD owners to opt out of ads for $15. Check out the full store here.

You’ll love many things about Amazon’s new Kindle Fire HD, but viewing ads probably isn’t one of them.

Amazon is placing an ad on the lock screen of the new tablets, which people will see whenever they wake the device from slumber or banish the home screen by clicking the power button. The ads apparently come from the “special offers” widget featured on all devices. Initially, this caused some people to criticize Amazon’s move, especially because the company didn’t give users the option to “upgrade” to an ad-free version.

However, now the company has confirmed Kindle owners will be able to opt out of the default ad settings, according to an Engadget report based on a tip from an anonymous source.

According to the source, Amazon sent the following response in response to a complaint regarding the lock screen ads:

“Special Offers appear directly on your Kindle Fire. Offers appear on your lock screen, and you can also view offers from the Home screen by tapping Offers. By delivering these offers to your Kindle Fire, Amazon is able to sell it for a lower price.

I understand that you would like to opt out of the special offer and willing to pay extra for opting out special offer. Options for unsubscribing special offer will be announced soon.

To ensure the utmost attention, I’ve also passed your message on to the appropriate people in our company. We value customer feedback such as yours as it helps us continue to improve the service and selection we provide.”

The obvious typos in the note do cast doubt on the idea that this is a new company policy: If the note did come indeed from Amazon, it doesn’t appear to be a prepared response but an improvised note from a customer rep.

We’re reaching out to Amazon for confirmation and more details and will update the post with any new information.

Update 9/7/2012 (1:35 p.m. PT): Amazon is apparently not willing to let people opt out of lock screen advertisements on the new line of Kindle Fire devices, reports Cnet. This contradicts information from the Amazon support contact’s response (above), which states that owners would have a way to banish the ads if they didn’t want them.

In the case of the Ad-supported Kindle readers, owners could pay to remove the ads when they redeemed a special offer. Presumably this fee would cover the lost revenue Amazon was bringing in for the advertising. However, this option won’t be available to new Kindle HD owners ( 7-inch, 8.9-inch, and 4G LTE versions).

Update 9/10/2012 (11:1o a.m. PT): Amazon is now allowing Kindle Fire HD owners to opt out of ads for $15. Check out the full store here.

Photo by Jennifer Van Grove/VentureBeat

Gameloft is jumping on the release of the Kindle Fire HD by releasing four of its top games on the new device.

The Oregon Trail: American Settlers, Asphalt 7: Heat, Fashion Icon, and Ice Age Village are the first of Gameloft’s 55 titles to take advantage of the Kindle Fire HD’s features and capabilities. The games are available on the Amazon Appstore for Android or directly from the tablet.

“[We picked] some of our best-selling games from the selection that is currently available on Amazon and optimized them for the new devices,” Baudouin Corman, the vice president of publishing, told GamesBeat. “Thus far, we’ve seen that the Amazon audience is pretty casual, so we expect the same audience to embrace the new Kindle Fire and the Kindle Fire HD going forward. Additionally, with three free-to-play games and one paymium game available for the tablets’ launch, we feel that we have a very strong assortment of titles that reach out to a variety of audiences.”

Amazon revealed the Kindle Fire HD yesterday. It comes in $199, $299, and $499 models and features improved Wi-Fi technology to better maintain a wireless connection — a plus for gaming, among other uses. The device also implements new parental controls called “Kindle FreeTime,” which allows adults to set time restrictions on their kids’ activities.

The Kindle Fire HD comes with full tilt, turn, and multitouch controls and allows users to compare scores with GameCircle, which uses Whispersync to save progress to the cloud.

“Looking to the future,” said Corman, “Gameloft certainly plans on launching more games for the platform — adjusting the line-up based on the success of our games and the platform itself. But overall, we think the new Fire tablets will definitely be a hit.”

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GamesBeat 2013 is our fifth annual conference on disruption in the video game market. You'll get 360-degree perspectives from top gaming executives, developers, and analysts on what’s to come in the industry. Our theme this year is “The Battle Royal.” Check out full event details here, and grab your early-bird tickets here!

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Amazon’s Kindle isn’t just for eBooks anymore. Increasingly, it’s about electronic games. Amazon’s new Kindle Fire HD tablet is getting praise from game companies, including the biggest one of all. Activision Publishing, a division of Activision Blizzard, is making its Skylanders Cloud Patrol game available for the Kindle Fire platform.

Santa Monica, Calif.-based Activision Blizzard sees the potential of mobile games and it launched its first freemium game (the iOS version of the Skylanders title) in April. It has also set up Activision Mobile Publishing as a publisher of third-party games created by outside developers. The Skylanders property is a true transmedia franchise — one that crosses various media types — as a top-selling console game and toy collection. Skylanders Spyro’s Adventure was the No. 1 seller for the first six months of 2012 in the U.S. and Europe, if you count accessory and toy sales, said John Coyne, consumer marketing vice president at Activision.

“We are thrilled to team up with Amazon to now bring the franchise to millions of Kindle Fire users,” Coyne said.

The Kindle Fire version will have an exclusive feature where players will be able to purchase toys from within the Skylanders Cloud Patrol game app, with just the push of a button. The always-logged-in Kindle Fire will buy the physical toy via an in-app purchase and unlock the digital character via Amazon’s 1-click purchasing. Then the physical toy will be shipped to the user. In Skylanders Cloud Patrol, the evil minions of Portal Master Kaos have overrun a region of Skylands. Players can use any of the 30 Skylanders characters to fight the bad guys. The player interacts with the game using touch gestures. The game will sell for 99 cents at launch and is dubbed “freemium” because it offers unlockable digital content.

Back in June, Activision’s mobile chief Greg Canessa told us that his company’s entry into mobile and its alliance with analytics firm Flurry were strategic moves.

“Our company is a thoughtful one,” Canessa said. “We aren’t one to promise the world and chase after it for years. We are thoughtful on how we enter new spaces, and our partnership with Flurry is a key component here.”

He added, “We are increasing our involvement in mobile and the microtransactions, games-as-a-service business model. This marrying up with Flurry is an indication of our increased investment. We’re going to find titles with a lot of potential and publish them.”

And today, Canessa said that Activision had a deep partnership with Amazon on the Kindle Fire relationship, mainly because it believes that the shift to mobile is becoming more and more important and Amazon has clearly demonstrated its commitment to the mobile gaming ecosystem.

“We have a leadership position in the video game space and they are a leader in digital commerce,” Canessa said. “It’s a great marriage. We are not the first to the party with mobile. But you this through our actions that we are making a dedicated effort with mobile. We see a huge opportunity around Amazon.”

Canessa said the iOS Skylanders game has had well over a million downloads. And all four of Activision’s major mobile game releases — Skylanders, Wipeout, Pitfall, and Call of Duty: Zombies — have made it into the top three paid apps rankings.

Atul Bagga, an analyst for Lazard Capital Markets, said in a research note today, “We believe we are seeing just the early chapters of a transformational story from a pure ecommerce player to a digital media platform. We believe Amazon has three competitive advantages that will allow it to compete in, and potentially dominate, digital media platforms: 1) trust; 2) technology; and 3) payment infrastructure.” He also said the company has highlighted strong ecosystems for digital media around the Kindle platform.

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GamesBeat 2013 is our fifth annual conference on disruption in the video game market. You'll get 360-degree perspectives from top gaming executives, developers, and analysts on what’s to come in the industry. Our theme this year is “The Battle Royal.” Check out full event details here, and grab your early-bird tickets here!

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July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Amazon shook up the tablet computing industry by entering a new device into the category: a glossy Kindle Fire HD that comes in a familiar 7-inch model or a supersized 8.9-inch variety. Amazon also introduced a fifth generation Kindle e-reader called the Kindle Paperwhite.

Amazon CEO Jeff Bezos featured the devices in a press event held in Santa Monica, Calif. today. Bezos also showed off a refreshed Kindle Fire tablet, but the clear star of the show was the all-new Fire HD.

The $199 7-inch Kinde Fire HD will feel familiar to existing Fire owners when it comes to its size, but the device packs a faster, louder punch with an HD display, faster processor, Dolby audio, and 11 hours of battery life.

The 8.9-inch Kindle Fire HD is bigger and brighter, though it’s not quite as ready for production as its smaller kin (it won’t ship until November 20). The $299 device has a 1,920 by 1,200 HD display and an OMAP4 4470 processor to speed things up. Both models come with front-facing cameras, Bluetooth support, HDMI out, and 16GB of storage.

Big spenders can plunk down an additional $200 to get 4G LTE connectivity, courtesy of AT&T, on the Kindle Fire HD 8.9-inch. This $499 model includes 32 GB of storage.

See also: Amazon unveils Kindle Fire HD and Kindle Paperwhite

I chatted up Dave Limp (pictured above), the vice president of Amazon Kindle, after the event to get a better idea of the company’s intentions behind its expanded lineup of devices.

“Customers are smart, and Amazon is founded on selection,” Limp said. “I think we’re hitting some key price points that consumers have told us … are important to them.”

Limp, of course, didn’t directly answer my question on whether the company priced its Kindle Fire HD to compete with the Google Nexus 7 or an Apple device — “$199 for what’s in this product — I hope somebody comes and tries to do it. It’s incredible. It’s the best value you’re going to see.”

But as to whether Amazon can successfully sell a $499 tablet to consumers, Limp really couldn’t say.

See also: Why the Kindle Paperwhite blows away previous Kindles

“It’s been proven that it’s a very large market,” he said. “I think we’re going to give it a shot and see how we can do with customers in that very big market. Now, we’re new and we probably have lots to learn … but having used this for the past month in and around Amazon, I think it’s a great product.”

So Amazon is extremely proud of its newest machinations, but what should you think of them?

Here’s my advice for you: Don’t order a Kindle Fire HD until you can spend more than a few minutes playing with one. It’s not that the 7-inch Fire HD (the 8.9-inch wasn’t out for display) was underwhelming, it’s just that I didn’t get enough time playing with it to say that it’s any better (or worse) than the Google Nexus 7, which I find to be a fantastic little device. Overall, the touchscreen was pretty responsive, but the browsing speed over Wi-Fi wasn’t all that impressive (maybe two antennae aren’t enough?), and the virtual keyboard felt pretty sticky.

The Kindle Fire HD is also different enough from the iPad and the Nexus 7 in how it operates, largely because of the Android fork that Amazon employs, that you’ll want to find the device that perfectly fits your fingers’ mojo.

The Kindle Paperwhite is a far easier sell. Amazon knows e-readers (it’s number one in the category), and this one’s design has serious readers in mind. Considering that the cheapest Paperwhite version (sans 3G connectivity) sells for a why-wouldn’t-you-buy-it? price of $119, any book lover will find the Paperwhite almost impossible to say no to.

Anyway, why don’t you have a look for yourself.

At a press conference in Los Angeles today, Amazon laid out its ambitious new plans for its successful line of Kindle e-readers and tablets.

And investors liked what they saw, rallying to push Amazon’s stock to its highest-ever price of $252.70. The event caps off a good run for Amazon’s stock, which has climbed 45 percent this year.

Why the surge? It’s likely that investors bought into Amazon CEO Jeff Bezo’s Kindle device strategy. “We want to make money when people use our devices, not when they buy our devices,” Bezos said during today’s press conference.

So far the strategy has been an effective one, allowing Amazon’s Kindle Fire to claim 22 percent of the tablet market since last year. That trend is likely to continue with the latest set of Kindle Fire tablets, which improve on the formula heralded by the original.

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

Amazon introduced another layer of parental controls for its Kindle Fire tablet today, better enabling parents to limit how much time a child spends on certain activities.

Amazon chief executive Jeff Bezos announced the parental controls at a media event in Los Angeles today, where he also announced an HD version of the Kindle Fire as well as the “Paperwhite” back-lit Kindle e-reader.

It’s called “Kindle FreeTime,” and while the options are still pretty slim, it’s a start. Parents can control the amount of time a child spends on the device as well as set up profiles for each child. Sliding bars on FreeTime’s control panel equate to reading books, watching videos, and using apps. Parents swipe their fingers across the scroll bar to increase or decrease time allotted for that activity. Once parents save the settings, they time restrictions apply to that child’s profile name. Once the total time is up, the Kindle Fire screen turns blue, alerting parents (and probably pissing off kids, but that’s not our problem).

Settings can be set per child profile, and should you children suddenly fuse and become one person, you can merge profiles.

After the release of the original Kindle, many parents and critics pointed out the lack of security controls, the capability for children to download anything they want and start reading and playing instantly. Indeed, VentureBeat executive editor Dylan Tweney even called the lack of real parental controls a “bone-headed move.” The company has slowly moved to add these features, however. You can see what Kindles offer by way of protection here.

Kindle Fire Image from Amazon