A new teardown analysis by IHS finds that, like the $79 Kindle e-reader, Amazon is selling the Kindle Fire at a loss. The research firm estimates the Amazon tablet, which retails for $199, costs $201.70 to manufacture. “Amazon makes its money not on Kindle hardware, but on the paid content and other products it plans to sell the consumer through the Kindle,” stated Andrew Rassweiler, senior director teardown services for IHS.

Indeed, the Kindle devices serve as distribution platforms for Amazon’s growing selection of digital content, including books, magazines and newspapers, music, movies and TV shows. The Kindle Fire also comes with a one-month Amazon Prime trial to encourage owners to use it for buying both digital and physical goods. The Amazon tablet began shipping this week. --Mark Walsh