For me it comes down to the usage pattern. I need a tablet device to read and surf the net in bed so I don't have to lug my laptop and/or use a light to read on eInk Kindle, to have something portable when outside, and as a primary connected device when on vacations/trips. I don't really watch that much video or listen to music on it.
Fire seemed like it would fit the bill. Unfortunately like I said, the screen just isn't high-enough resolution and Kindle app is no different that on any other device. While I'm sure at $200 the screen is as good as it gets, it's disappointing that Amazon didn't create a superior Kindle experience, maybe with collections, page numbers, better page transitions, and faster book scrolling. I have way too many books to not have them grouped, and it's annoying when a dual-core tablet has a problem scrolling backwards in a book.
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