In the technology industry, two businesses stand out as having risen above the sea of profit losses, revenue declines, and layoffs: Apple and Amazon. While Apple posted a banner quarter recently, Amazon’s also doing remarkably well, with its profits jumping 24% in the first quarter, and beating expectations for the second quarter running. Amazon’s doing so well, in fact, that it has emboldened them to release the newest version of their Kindle electronic book reader today. The new Kindle DX, which is substantially larger than the current model, and is also substantially more expensive at $489, hits the market today. The smaller Kindle only costs $359.
But is the move a smart one? While it’s estimated by Citigroup that Amazon will sell around one million standard Kindle readers this year, it still strikes us as an incredibly ballsy move to release a premium product that’s more expensive than the standard model during a time when most businesses are slashing costs and offering discounts. Amazon can certainly get away with it, of course, because of just how well they’ve been doing. But it’s an aggressive move nonetheless. The question we have is whether it’s a tad too aggressive.
What do you think about Amazon’s timing in releasing the new Kindle now? Would you buy one of the new Kindles? And would the nearly $500 price tag be a deterrent to you? Tell us what you think in the comments section below.