Thursday, September 29, 2011

Four Reasons Why The Kindle Fire Is Not A Win For Apple

A writer and Apple devotee whom I respect was quick to react to yesterday's unveiling of the new Kindle Fire tablet from Amazon, but I think his love of all things Mac got the best of him. He tweeted that the Kindle Fire is "a win for Apple."

Really? Maybe if the folks working at 1 Infinite Loop are holding some Amazon stock. It closed the day higher on the news of the new 7-inch, full-color, multi-touch tablet that offers email, web browsing, apps, movies, music, TV shows, streaming instant video, magazine subscriptions, and the world's best-selling e-books. And all for just $199.

Now, I'm not suggesting that the Kindle Fire will sweep across the tablet landscape like dry brush set ablaze in the scorching Texas sun. This is no iPad killer, but it's likely to take a decent chunk of the 80% market share that the iPad now enjoys. Why?

It's cheaper (or, "It's the economy, stupid.") The Kindle Fire is less than half the price of an iPad. That means when a husband says, "Honey, can we afford an iPad, or should I buy his-and-her's Kindle Fires and still have $100 to spare?" you know what the answer could be. The sale of 5 million Kindle Fires won't destroy the bottom line at Apple, but if just half of those are bought instead of an iPad, that's over a billion dollars of lost sales. And that's hardly a win for Apple. 

For many people, size doesn't matter.  The Kindle Fire has a smaller screen than the iPad, but the dimensions make it an easy fit for e-reading, web browsing and media viewing. Plus, it's more convenient to carry and tucks under an arm or into a purse a lot easier than an iPad. Again, not a "W" for Apple. 

It's enough tablet for the masses. Just like you don't need to buy a Corvette in order to have a fast, fun car, many people will be just fine with the performance of the Kindle Fire. It's been engineered to make the best use of a dual-core processor and cloud-based storage and offers the features that people want most in a tablet. No camera? No 3G? Oh well, I guess you'll still have to carry your smart phone. You know, like the people who own an iPhone and an iPad. Sorry Apple, but at best, this one's a draw. 

It's simple to use.  The folks at Apple can take credit for pioneering the simple-to-use, self-contained ecosystem of software and hardware that is iOS, iTunes, the iPhone and iPad. But imitation is the sincerest form of flattery, and the Kindle Fire is doing it with a custom version of the Android operating system using Android apps available from the Amazon Store, along with millions of songs, movies, TV shows and instant streaming video. And Kindle e-books. And did I mention that all this simplicity and content comes at less than half the price of an iPad?  Advantage Amazon.

So there you have it; an opening day box score with a lot more runs for Amazon than the Apple squad. But the season is just beginning, and we'll have to see how the new phenom holds up in the stretch run. You can be sure of one thing though -- this isn't a one-team league anymore.

Friday, September 23, 2011

Still Hate The Auto Bailout of '08? Read This.

To all the union haters who cried "foul" after the government bailed out General Motors, let me direct your attention to this week's news of a new labor agreement between GM and the United Auto Workers union. 

The deal has no regular pay raises, but includes a $5,000 signing bonus, something that should be popular with all the Republican-leaning Wall Street types who cash much bigger bonus checks every year. Union workers will also get profit sharing, plus a boost in starting pay rates for the new hires in GM's two-tier system.

There's also the 5,000+ new jobs that will be created under the agreement as General Motors brings more assembly work to its U.S. manufacturing plants and could include reopening the former Saturn plant in Tennessee.

So that's tens of thousands of jobs saved and strengthened, and thousands more being created as workers and management share in the soaring profits of a revitalized American company that was written off by the conventional wisdom of those who were aghast at the government bailout plan in 2008.  To those people I ask, what other government money has been spent so wisely in the past three years to yield such an economic boon?

My guess is we won't hear much from the union haters on this one. They'll just watch their new GM stock grow in value and keep quiet.