Wal-Mart Gives Amazon Kindle Products the Boot
September 20, 2012 11:55 PM
comment(s) - last by
Competition between the two has come to this
Wal-Mart reported that it will no longer sell Amazon's e-readers and tablets online or at its brick-and-mortar stores.
Amazon, which makes Kindle e-readers and Kindle Fire tablets, had its products booted from Wal-Mart due to the fact that Amazon is a strong competitive force against brick-and-mortar stores.
Physical retail stores like Wal-Mart and Target have faced tough competition against Amazon in recent years. The huge e-tailer has offered the same products at lower prices, (often) no sales tax and for fast, cheap delivery.
This obviously made it hard for the brick-and-mortars to compete. Stores like Best Buy, Wal-Mart and Target complained that Amazon's lack of
sales tax collection
in most U.S. states was unfair, leading to more and more states demanding that Amazon start collecting (mainly to cover the states' own budget crisis').
At long last, Wal-Mart and friends got their wish when Amazon agreed to start including sales tax in customer orders; however, the e-tailer did so in exchange for more distribution centers throughout the U.S. so that it could
launch a same-day shipping feature
-- a whole new competitive edge in favor of Amazon.
To top it all off, Amazon's e-readers and tablets have been a hit. In fact, Amazon's Kindle Fire tablet has been the only other tab to take a chunk out of the iPad's market share.
Amazon just announced a whole
new generation of Kindle Fire tablets
(Kindle Fire HD), including an updated $199 7-inch Fire; an 8.9-inch version for $299, and a 4G LTE model for $499. On top of that, Amazon is offering 250MB of bandwidth per month, 20GB of cloud storage space, and a $10 in Appstore credit for only $50 per year.
It's easy to see why Wal-Mart is a little upset. It's competition is growing and offering even better offers all the time, leaving the brick-and-mortars in the dust. But there is another side to this -- the Kindle Fire was the hottest holiday gift in Q4 2011, racking up tons of sales for not only Amazon, but the physical stores like Wal-Mart too. With the Kindle Fire HD line launching either September 14 or November 20, Wal-Mart could lose out on
the huge sales
that these tablets could potentially draw.
Target stopped selling the Amazon Kindle line this past Spring as well.
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RE: California Sales Tax and Same Day Shipping
9/21/2012 3:43:48 AM
I've never used anything but free or cheapest shipping for Amazon orders (that actually goes for all online shopping). Maybe I am old fashioned now, been shopping on the internet since the last century!, but shipping time has never been an issue to me - anything so critical that I need it asap I need *right away*, not the next day. I doubt my outlook will change but I can see many of the truly instant gratification younger people paying for faster shipping.
"Paying an extra $500 for a computer in this environment -- same piece of hardware -- paying $500 more to get a logo on it? I think that's a more challenging proposition for the average person than it used to be." -- Steve Ballmer
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