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Kindle Fire: It's No Tablet

Amazon's Kindle Fire tablet was releasd today, and based on the initial reviews, the secret we T-GAAP-ers already knew about is now out of the bag: The Kindle Fire tablet is no tablet.
Wired puts the Kindle Fire to the test and it fails miserably. Whether delivering a horrific web browsing experience or being a product that makes reading a chore, the Fire delivers these types of experiences in spades. So what is the Fire, and what type of product is it pretending to be?
The answers are quite simple, and it isn't just for the Kindle Fire, it's for any 7-inch device:
- The 7-inch product is pretending to be a tablet, when it isn't. The Fire (and other products in the 7-inch space) exist only because companies cannot compete with Apple's $499 price point for the 10" iPad.
- The 7-inch product is a misfit that should be targeted as a large casual gaming iPod touch, not a tablet.
- The brief history of iPad has created this mess that Amazon, Barnes & Nobel and all the other pretenders will soon discover: "The 7-inch tablets are tweeners. Too big to compete with a smartphone and too small to compete with an iPad." – Steve Jobs.
Apple stunned the market with a 10-inch iPad for only $499. Most of Apple's would-be competition had figured Apple would launch their product starting at $999, allowing a slight pricing umbrella to play under over time. It didn't happen.
The reaction to iPads instant success, sent the competition scrambling to figure out how to make a $499 10" tablet of their own. They couldn't. It took 11 months for the first major 10-inch tablet try to make it to market for slightly more than an iPad – The Motorola Xoom.
Xoom was heavily pushed in advertising, and through their distribution channels, only to receive poor reviews, and a complete lack of interest by the overall market. We reviewed the product and found it to be a complete wanna-be iPad, devoid of any reason why someone would purchase one.
Looking for margin, Samsung retreated to the 7-inch device market space, launching their Galaxy Tab product. It's been a complete failure for the company.
The result of the failed 7-inch Galaxy tab has been for Samsung to enter into the 10-inch tablet market. The 10-inch Galaxy Tab has seen more staying power than their 7-inch version, but whether Samsung's product will make it through the legal ringer is another matter altogether.
Amazon, along with Barnes and Noble, attempting to try the 7-inch space one again, despite warnings that market space won't be successful, reveals the desperate nature of Apple's competition. Will the Kindle Fire sell well? Initially, it may see some strong sales volumes, as the price is right for the current economy, and it's something new. But I also recall the Spice Girls and Cabbage Patch dolls being popular, along with the Xoom being the next big thing... Don't count on Kindle's Fire being much more than another flash in the pan.
