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Amazon to become synonymous with Android tablets

TabletsNews
, 30 Aug 2011News

Despite silence from the company itself, book seller turned general-purpose retailer Amazon is thought to be launching a an Android tablet as early as this October - and at least one analyst believes that it could be a major shake-up for the market as a whole.

Amazon is no stranger to own-branded portable gadgets, of course: it's popular Kindle range of eReaders have been best-sellers since their launch, offering an impressive way to take your book collection on the move and all but shutting out competing devices from the likes of Sony from the UK eBook market.

Previously, however, the company has indicated that its Kindles are the limit of the technology: rumours of a large-screen colour version capable of more impressive web browsing and video playback have been denied, with the closest device being the large-screen Kindle DX which maintains the greyscale eInk display of its smaller brethren.

If you think a large-screen full-colour video-capable device sounds a little more like a tablet than an eReader, you'd be right - and that appears to be the direction in which Amazon is heading. The company's denials have thus far focused on its refusal to add colour display capabilities to the Kindle, rather than an entirely new product to launch under a different name.

Amazon's as-yet unnamed and unconfirmed tablet, industry analysts believe, would run Google's Android platform, featuring a large screen, long battery life, integrated 3G connectivity, and - this part is key - retail for considerably less than its competitors. General consensus is that the Amazon Tablet - for want of a better name - would hit the US market for under $300, significantly undercutting Apple's iPad and giving the majority of the Android tablet market a run for its money.

The potential is there for Amazon to cut the cost even further: by bundling its Android Kindle app with the tablet, it could subsidise the cost of the device in the hopes of making that money back on content sales. With 'Kindle Edition' eBooks often costing more than their paper-based equivalents, such a 'razor-blade marketing' approach could work in Amazon's favour.

It's certainly true that cheap tablets sell. Although bargain-basement Android tablets have been slow to take off - usually due to severe cost-cutting measures including poor screens, slow processors, and outdated Android versions - the recent rush to buy HP's cancelled TouchPad tablet at a ridiculous £89 has demonstrated that there's plenty of demand for a cheap, capable tablet out there if the price is right.

Forrester analyst Sarah Rotman Epps believes that not only is the Amazon tablet on its way, but that it holds the secret to change the face of the tablet market - and the developer ecosystems for the various tablet operating systems - spectacularly.

"If Amazon launches a tablet at a sub-$300 price point - assuming it has enough supply to meet demand - we see Amazon selling 3-5 million tablets in Q4 alone," Epps writes in a summary of her latest report for the market watcher. "Amazon’s quick ascension in the tablet market will completely disrupt the status quo."

To clarify, Epps doesn't believe that Amazon's rumoured tablet will be a direct risk to Apple - she claims that the iPad will keep hold of the lion's share of the tablet market, largely thanks to impressive marketing and a major head start over its rivals - but that the tablet's launch will cause a major shift in the way the tablet market operates.

The most obvious change, Epps argues, will be visible in the relationship between Amazon and Apple. While the pair don't directly compete at the moment, the launch of a tablet designed to undercut the iPad will change that - and Amazon has already indicated its displeasure with Apple over the rules on in-app purchases, launching a web-based Kindle Cloud Reader service to bypass the 30 per cent cut Apple demands on all proceeds.

Epps also argues that a cut-price Amazon Tablet will be exactly what the market needs to stimulate Android app development. While the Android Market is bristling with apps, only around 300 of these are optimised for tablet form factors, compared to an estimated 100,000 iPad-optimised apps in Apple's App Store. "If Amazon’s Android-based tablet sells in the millions, Android will suddenly appear much more attractive to developers who have taken a wait-and-see approach," Epps claims, with banks, publishers, and retailers all rushing to provide an Android-native app for masses.

The Forrester report also makes the claim that OEMs will look to partner with Amazon to produce their own 'Amazon Tablets,' each with a unique feature or upgraded specifications but all featuring Amazon's own software layer over the top. In many ways, this would be the ideal scenario for Amazon: removed from the hardware level, it would be able to reap the benefits of increased content sales without the need to produce expensive devices of its own.

Epps concludes: "A year from now, 'Amazon' will be synonymous with 'Android' on tablets, a strong second to Apple’s iPad." Where that leaves current Android tablet makers like Samsung, Asus, and Acer isn't clear - but if anyone can breathe new life into a crowded tablet market, it's likely to be Amazon.

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