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October 14, 2011, 5:15 am UTC
Amazon last week announced the November launch of their full-colour Kindle Fire table. It is expected to ‘fire’ up the tablet and advertising market space
Nobody thought of Amazon to be anywhere near a competitor on the tablet front. However, with the launch of Amazon’s full-colour tablet device called ‘Kindle Fire’, Amazon, seems to have hit bulls-eye once again.
Amazon, with its e-book reader Kindle, was one of the first to preempt, harness and indeed builds a tablet market. However, Amazon used the tablet only as a light, thin ebook reader, while it was Apple that saw the full potential of the device and their iPad success is a true success story with very few competitors on the fray. Or so we thought.
Turns out Amazon has not really been sitting quiet as Apple gained foothold in the tablet market. It has been working on its Kindle device and the Kindle Fire is designed not just for e-books, but TV shows, music, books, magazines, apps, internet browsing, games etc. And at $199, almost half the price of Apple’s cheapest iPad, Amazon might have put ‘fire’ to the pot that’s baking the table pie. Kindle Fire will begin shipping in November, hitting the holiday season.
To add to the large amount of content that is already available on Amazon devices, the company last week also announced a licensing agreement with FOX that will allow Amazon Prime member to stream movies and TV shows from the FOX library. This brings up the total number of Prime instant videos to over 11,000 movies and TV shows.
This opens up the battle on two fronts: one is obviously in the tablet devices market and the second is in terms of branding and advertising options available to marketers.
Along with Fire, comes Amazon’s new browser ‘Silk’ that with a dual architecture, divides the work for loading a web page, between the device hardware and Amazon’s Elastic Compute Cloud, allowing the page to load much faster. Besides this the browser is also programmed to use Amazon’s collaborative filtering and machine learning algorithms to learn more about individual sites and a users behaviour i.e. where s/he will go next.
This smart browsing experience could be used for behavioral targeting of ads, something that is already done on the Amazon site. As for its devices, Kindle and Kindle 3G are ad-supported and come with what Amazon terms, Special Offers. So far however, there is no news on whether Kindle Fire would have these Special Offers.
Despite these uncertainties, what is sure is that Kindle Fire would open up revenue opportunities for publishers. Besides, the knowledge that Amazon has of targeted, intelligent advertising on its site, could be passed on to the device, helping generate targeted ads for the user, thus providing a perfect platform to advertisers and marketers.
For publishers, this opens up an interesting world and a potential for extra revenue. Imagine a magazine that is read on the Kindle. As for the print edition, the advertiser has no option but to show and the advertiser to see what is on the page. However, on the device, a reader, based on his behaviour, demographics and preferences, could see ads that are relevant to him/her.
This will thus heat up the ad market in tablet devices as well. As it stands, in terms of desirability, it is the iPad that calls the shot right now. But Kindle Fire has the price advantage and could see great penetration in coming months. This could open up a huge market for advertising which with Amazon’s targeted ad technology could provide a better platform to advertisers and marketers.
Right now, these may sound like mere speculation considering that the launch of the Kindle Fire is still a month away and it is tough to predict market behaviour. Yet, what is clear is that the tablet-war and the digital ad-war just got heated up.
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