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By Chris Meadows

amazonfire98Amazon introduced three new e-ink Kindles: a $79 low-low end model, not touch-sensitive and with minimal physical controls (about akin to what the Kobo and other such non-Kindle readers have had up to this point), a $99 Touch WiFi model, and a $149 Touch 3G model (both of which have no physical controls at all). It also introduced the Kindle Fire tablet at the remarkable price point of $199.

Amazon Moves Price Point Goal Posts

Something that is important and worth mentioning, and that I haven’t seen in the other reports I’ve looked at, is that Amazon has quietly moved to change the default prices for its devices. Formerly the default price was for the ad-free version, and the “Kindle With Special Offers” version was presented as a cheaper alternative.

However, in the presentation of these new Kindles (save for the Fire), the default prices given are for the “special offers” versions: if you check the $79, $99, and $149 Kindles’ order pages, you discover that the prices for the ad-free versions are $109, $139, and $189, respectively. The Kindle Fire pre-order page just says $199, and there’s no mention of special offers at all, so it’s not clear whether that’s with or without. My money’s on with, though, and on ad-free costing the $249 price point that had originally been expected for the device.

So Amazon has changed from being ad-free “by default” with ads a way to get the devices cheaper, to being “special offers” by default and you pay extra for no ads. Not that I can really blame it, I guess; being able to trumpet lower price points makes for great marketing copy—especially since Barnes & Noble’s Nook doesn’t have an ad-supported version. So Amazon will always look cheaper in a straight “default prices” comparison, even though the price of the ad-free version will be about the same!

To be fair, I gather Amazon has managed to implement the ads in a way that is less obnoxious than it might be, and that gives customers offers local to their own geographic areas and interests. Still, when you look at it in that light, the new prices aren’t quite so impressive. In comparisons to the “default” price of the previous Kindle generations, be careful not to compare apples and oranges.

Device Features

Looking at the Kindle Fire, its noteworthy features include a custom web browser, Amazon Silk, that uses a client-server model to offload much of the work of rendering pages into Amazon’s cloud. It will learn from users’ browsing habits in order to preload and prerender content they are likely to want to view. (Privacy advocates may get up in arms about this.)

Another noteworthy feature is that Amazon’s Whispersync, previously used for keeping your place in e-books, will also keep your place in an Amazon Prime streaming movie you start watching on your tablet then continue on your TV. Also, the Fire will fully interface with Amazon’s cloud and not require a physical connection to sync. (Bezos showed a picture of the iPhone’s USB connector cable at this point, a none-too-subtle jab at a feature missing from the competition.)

But the Fire is only the flashiest new device. Perhaps even more important are the touch-sensitive Kindles, which use IR sensors to avoid the necessity of a blurry touchscreen layer on top of the e-ink. The WiFi model managed to break that magic $99 price point, something Bezos himself noted during the event with a slide quoting Dan Frommer from Business Insider saying, “Imagine how many Kindles amazon will sell when it’s even cheaper next year—say, starting at $99.”

And of course, that was right before Bezos shattered expectations by introducing the teeny-tiny $79 non-touch Kindle. Imagine that: access to Amazon’s e-book ecosystem, including library checkouts and possibly an Amazon Prime library down the road, for just $79.

While the $79 Kindle is impressive, make no mistake, I suspect it may exist not so much for itself, but to drive sales of the $99 touchscreen model. Plenty of people will buy it, of course, but others will look at it, and its puny little controls, and say, “For just $20 more, I could have a touchscreen,” and buy that one instead.

The touchscreen also means we’ve seen the last of physical keyboards on the Kindle, which enabled them to make their devices that much smaller. (Of course, the $79 non-touch one lost the keyboard, as well, though I suspect that means it also lost a lot of the flexibility of input that its predecessors or the touchscreen models have.)

And also worth mentioning in passing is the new “X-Ray” feature that comes with these devices, in which they will pre-cache information from dictionaries and Wikipedia pages that people can view without having to switch out to a browser. It might be a relatively minor feature, easily lost amid other bells and whistles, but often minor convenience features like that can count for more than the flashier stuff.

Expectation Setting

I wonder just how many of the leaks that have come out about the new Amazon stuff in the last few days were intentional, meant to set expectations so Bezos could blow them away? After watching the liveblog coverage of the Amazon press event, it seems to me there was a lot of that going on, even during the show itself.

For instance, on Gizmodo’s liveblog, at the beginning of the show one of the correspondents breathlessly announced “Holy holy holy. Amazon is launching a $79 Kindle too!” The linked article at that point announced the Kindle would be $79. Then during the show a few minutes later, when Bezos introduced the new Kindle Touch and said it would be $99, the article mysteriously changed that price point back to $99. (I checked.) Then later in the show, when Bezos introduced the non-Touch Kindle, that was $79 after all, and the article got changed again!

In the end, after you strip away the price point goalpost movement and the theatrics, Amazon has still produced an impressive crop of new readers, and an impressive new tablet. If it can get people to swallow the advertising pill, Amazon’s new Kindles could explode across the market in a way that makes its previous inroads look tame.

B&N and Apple better have some impressive new tricks up their sleeves if they want to compete with this.

 
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