Print 13 comment(s) - last by blueboy09.. on Oct 15 at 8:40 PM

No Profit for you! Profits come with content sales not hardware at Amazon.

A lot of technology products and gadgets are sold at breakeven and at times even at a slight loss in order to make money off accessories or services the go along with the products. This is the case with the new Amazon Kindle Fire HD and Paperwhite devices. 
"We sell the hardware at our cost, so it is break-even on the hardware," chief executive Jeff Bezos told the BBC.

Bezos notes that Amazon's plan for making money off digital content rather than the devices themselves has worked so far. Bezos says that the user tends to consume more digital media once they own a Kindle or a Fire tablet.
"What we find is that when people buy a Kindle they read four times as much as they did before they bought the Kindle."
"But they don't stop buying paper books. Kindle owners read four times as much, but they continue to buy both types of books."
Along with these new gadgets, Amazon has also recently announced the roll out its book lending platform in Europe. Users of Kindle devices in the UK, Germany, and France can now access the Kindle Owners Leaning Library.
This library allows users to borrow up to one book per month from a selection of titles, some of them very popular titles, at no cost. At launch, the UK service will feature over 200,000 digital books.

Amazon is launching the Fire HD tablet and the Paperwhite eReader in Europe on October 25. 

Source: BBC

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Profits? Heh!
By melgross on 10/12/2012 11:32:54 AM , Rating: 2
I doubt they make any money on this. He's very cagy about talking about total costs, rather concentrating on the costs to make statement. He actually refused to say whether they were losing money on the sales.

They only make between 3-5% on content sales, including Kindle books. This is the same amount Apple makes per dollar of sale. It's one reason why Amazon has virtually no profits.

RE: Profits? Heh!
By andrewaggb on 10/12/2012 11:44:56 AM , Rating: 3
yeah its a dangerous game. But if they price them competitive with the ipad they will lose to the ipad and they know it.

And they're probably worried that if apple gains total market share, then apple will systematically take over ebooks, music, movies, maps (cough), search, etc, all in their own time.

Microsoft more or less did it with a fairly open platform that allowed some competition, just imagine what apple will be able to do. Scary stuff. I'm both fascinated and frightened by Apple, MS, Google. Generally google seems less bad, but since people and their information are googles product... I'm not convinced that ultimately there is much difference.

RE: Profits? Heh!
By inperfectdarkness on 10/13/2012 4:46:42 AM , Rating: 5
Google is the totalitarian regime waiting in the wings for the fascist dictatorship of Apple to be deposed.

In all honesty, since the departure of Gates, MS is more like a transparent, conservative democracy--offering utility and service without unwanted intrusiveness.

but that's just my take...

RE: Profits? Heh!
By theapparition on 10/15/2012 9:45:07 AM , Rating: 2
A little melodramatic, don't you think?

Google doesn't care what you do, just as long as they know what you are doing.

"When an individual makes a copy of a song for himself, I suppose we can say he stole a song." -- Sony BMG attorney Jennifer Pariser

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