This is par for the course with offshore manufacturing.
I wonder if someone in China built a shadow factory when Amazon was putting together the Kindle2 production line? This is when the plans and specs for the new production line are quietly copied and they build an identical production line a few miles away to churn out the same goods, with a different brand. You see the end result on sites like dealextreme.com where they sell 'lookalike' products based on major US brands. In my experience the quality is often lacking in these products (to put it nicely).
Ultimately it doesn't really hurt Amazon much since their innovation is all in the software and backend service, and the Kindle hardware design is only a small part of their IP. It's not like a Kindle clone could buy from Amazon.com. I assume Amazon have their software and other IP locked down with digital certificates etc that cannot be easily cloned, and unofficial devices are locked out by default.
Last edited by morpheus; 07-10-2009 at 10:03 PM.