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My assumption is that Amazon makes their money on the content, not the device. The more they keep customers buying and using the Kindle, the more books, magazines and newspapers they sale. To a great extent, Apple is the opposite, they use the iTunes store to sale hardware (iPhones, iTouch, iPods). Both ways can make money, and certainly if Amazon can make a profit on each Kindle sold, that's great, but they need to stay focused on what their core business is, which is the books.
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