Amazon is not taking any risks with the Kindle Fire; unlike other contenders to the iPad's tablet crown Amazon has launched a four pronged attack, that we hope for the sake of competition will succeed.
Firstly, Amazon went for the cheapest pricing possible, even apparently losing money in the process. At $199 the Kindle Fire is cheap, less than half the price of the cheapest Apple iPad 2. Amazon deliberately left out (for now) the option of slashing another $40 off the SRP with an ad-supported version.
Secondly, unlike similarly priced tablets, the Kindle's hardware is on par with the rest of the competition. A 7-inch 1024x600 pixel IPS Touchscreen, a dual core SoC clocked at 1GHz, the same amount of RAM as on the iPad 2 and 8GB onboard storage. There are a few cut corners like the lack of cameras and GPS, but then Amazon wants people to consume content (preferably from itself), not produce it.
Thirdly, Amazon has gradually over the last three years built up infrastructure and content even capable of matching Apple's. Cloud computing storage and compute power? Check. App Store? Check. Millions of movies, TV shows, soundtracks and books? Check. Own browser? Check.
Apple may have found a formidable foe and the fact that Amazon hasn't sold the iPad 2 since its launch, means that a rumble has been brewing for some time. Let the battle commence!
You can read a preview of the Amazon Kindle Fire on our sister site, ITReviews.