Commentary

Amazon Ready To Light The Device Fire With Video Kindle-ing?

Amazon appears to be on a much-deserved roll with its latest generation of Kindle Fires. Aside from the fact that Amazon's BS metrics never tell us how many units they really sell, all signs point to a very strong holiday season for the Kindle HDX line of tablets. The mobile ad network Chitika just released its traffic analysis of usage share from devices. Even considering that Chitika's metrics are mainly coming off of mobile ad units, which I am not sure would be as strong for Kindle apps and Web browsers, Amazon saw a 9.4% share gain this holiday. Share is still microscopic (.6%) relative to Apple's massive usage lead of 76.1%. Nevertheless, I would post this is a big win for Amazon and likely indicative of a successful third stab at denting the iPad market with cheaper, technologically equal devices.

I am not sure how much of the gains are attributable to a much more aggressive marketing plan this year. But the TV spots mocking Jony Ive's breathless iPad descriptions were notable in their bluntness.

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And as BTIG Research's Richard Greenfield notes in a blog post yesterday, Amazon is also taking aim at Netflix. After building and investing for years in a streaming video service Prime Instant Video, the company finally seems to be ready to promote it. In a new lengthy TV spot, Amazon asks why a Prime customer (who is also getting free shipping for $80 a year, would really need to subscribe to a second video service.

To be sure, Prime Instant Video doesn't have its own “House of Cards” quite yet. But Amazon is trying. But its service actually combines the best aspects of Netflix (all you can eat older media) with iTunes (rentals of current releases). I don't get why Amazon isn't making more of this, because it is precisely why I find myself using Amazon more often now. You can drill into their considerable back catalog but also rent titles that are not available at the smorgasbord buffet table. This is exactly what I wish Netflix would provide.

Greenfield suggests that Amazon may finally be ready to threaten Netflix because it finally is promoting itself as a video provider. Well, maybe. The real threat comes when Amazon wakes up to the advantages it really does have over some of the rivals. In many ways the Prime Instant video experience is superior to Netflix and iTunes. I find their recommendation engine much stronger. I like that they allow for previews and trailers of everything. And the catalog is easier to navigate.

I also find that in using the Kindle HDX 8.9-inch model over time I am even more impressed with its functionality. The display is more even and neutrally white than the iPad Air. The Silk browser is much improved over earlier false starts. The audio is excellent -- both loud and rich. And the thing trumps the Air at its own lightweight game. The HDX actually makes the iPad feel heavy in comparison. And I have written elsewhere about how the X-ray and Whispersync Audio features are genuine innovations on the media front.

Now, alas, the Kindle HDX still suffers from a weak app ecosystem. Because it competes directly with Google Play on film rentals, books and music, Amazon can't bring itself to let in the portal for most Android apps. Otherwise, the Kindle HDX could and should blow the Android tablet competition away. 

Of course, if they decide to become a smartphone brand then all bets are off. As a tablet company geared toward media consumption Amazon makes a lot of sense. As a phone company? About as much as Facebook does, and we saw how much consumers welcomed that company's attempt to take over their Android experience with the misguided Facebook Home initiative.   

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