Amazon's Cunning Plan To Fight Apple's New iPad

US retailer, Amazon, is offering to buy used iPad 2 tablets for much more than rival trade in companies in what could be a cunning plan to get existing iPad 2 customers - and prospective buyers of the new iPad - to switch allegiance to Amazon's own $199 Kindle Fire tablet.

The site currently offers up to $320 for a 16GB Wi-Fi iPad 2 tablet, $79 less than the price of a new tablet. According to Pandodaily's Farhad Manjoo, far from being overtly generous, Amazon's deal comes with a big catch.

Amazon's $320 can only be spent on the retailer's website which means that not only that the actual cost of the transaction is less than the face value but also that Amazon gets a share of proceeds when the tablet is refurbished and resold by one of the many of Amazon's marketplace vendors.

Now if you sell your iPad 2, chances are that you will want to buy a new tablet except that Amazon does (and will probably not) officially sell the New iPad. Indeed, searching for "new iPad" returned a search page with "Compare iPad vs Kindle Fire" as the top result.

Arguably, Apple could have rolled out an official trade in scheme which would allow it to lock existing iPad users in a longer cycle. Amazon's trade in only operates in the US for the time being and as a beta programme for games and books only.