Why Android Could Help Amazon and the Kindle Threaten the iPad

by Ostatic Staff - Mar. 21, 2011

Quick, across the entire history of Amazon, and all the types of products that the site has sold, what is its top selling product ever? The answer is that the Kindle eBook reader is, and that feat was attained while the Kindle functioned as a reading device, without the bells and whistles found on popular tablet devices. No Harry Potter book or other product comes close to the sales Amazon has reaped from the Kindle, and those sales have, of course, driven sales of lots of content from Amazon. For these reasons, and because of the increasing unpopularity of Apple's policies regarding in-app purchasing, the Kindle could emerge as the biggest competitor to Apple's iPad, if Amazon plays its cards right.

We've noted before that the various Android tablets--some of which are selling well--that compete with the iPad will need big backers to succeed. As The Register cites, while Apple faces increasing backlash for its restrictive in-app purchasing policies, that backlash may spell opportunity for next-generation versions of the Kindle:

"...the retailer has the weight and self-interest to make trouble for Apple. Currently, its Kindle for iOS ereader app handles all ebook sales through Amazon's own Kindle web store, with the revenue divided only between Amazon and the publishers. The more successful Apple's tablets and apps are, the more difficult it will be for Amazon to walk away from its iOS platform – but it could whip up a dangerous level of consumer, developer and even regulatory opposition to the iPhone maker."

Amazon has much to gain from shifting the Kindle from just an eBook reader to a fully functional content- and application-ready tablet device. It has already found success selling the Kindle at budget prices and making up the profits selling content for the device. Now, Amazon has an Android app store of its own that it is working up, and Android could become a viable platform for the Kindle going forward--one that would make the Kindle much more than just a reading device.

The Register also notes this:

"Forrester research found that 24 per cent of consumers would favour an Amazon tablet over other choices specifically because of its content assets in ebooks, music, video and games."

 That piece of research is key to understanding Amazon's opportunity. It has content assets that it can build around a device designed to be more robust than today's Kindles are. As a platform, Android represents a huge opportunity for Amazon, and one that it could leverage with its own Android app store. There are already rumors that Amazon is working with Android. This year, look for Amazon to push forward with a more ambitious tablet device strategy, and watch as it produces the most direct competition to the iPad yet.