Amazon will make $50 on each Kindle Fire

[=X=]

It seems there are conflicting reports on exactly how much Amazon stands to make on each device. This report claims that Amazon will be making $50 on each Kindle Fire.

I'm not sure which report is more accurate, but I will say this. A few years back Mr. Bezos said he treat the Kindle hardware unit separate from the Kindle software. Each must make money on it's own to exist. If he has been true to his word it would only make sense that the Fire is profitable and not losing $10/$50 per sale(--depending on what article you read)

Amazon's $199 Tablet Is No Loss Leader

Based on its estimates of the bill of materials and cost for the Amazon Kindle Fire, iPad 2 and PlayBook, device experts at Light Reading sister company UBM TechInsights estimates that it costs around $150 to produce the 8GB Kindle Fire, compared to $170 for a 16GB PlayBook (the device it most closely resembles) (more...)

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[KindleFan1]

Do those prices include research, packaging and marketing?

[Grimm]

Good for Amazon, nothing wrong with making a profit!

[=X=]

Originally Posted by KindleFan1

Do those prices include research, packaging and marketing?

No I don't see it on the list. But considering they used the Playbook as a core device and Android as an OS, I don't think their R&D is huge compared to say Apple or Google.

But the real story here is because they are making a profit they will recoup the cost eventually, and selling 100K on the first day is an indicator that they will start recouping the cost soon.

=X=

[=X=]

Originally Posted by Grimm

Good for Amazon, nothing wrong with making a profit!

Yes, I agree. It's nice when a company can make a profit w/o price gouging their customers. Though the profit for this device is not much.


I suspect that Amazon plans to continue to make money on the services it provides, moves, books, etc..

=X=

[OtterBooks]

I wonder if they're selling both hardware and content at a slim margin so they can sell tons of it. That's certainly a new strategy for Amazon.

Oh and that estimate presumes Amazon had to settle for the same manufacturing deals as RIM. Maybe so, but if Amazon truly pre-sold half as many Fires in one day as Playbooks have sold ever, I doubt that will continue.

[elcreative]

And it's amazing to see that it costs nothing for the case, assembly, quality control, packing and shipping... do you think they'd let the rest of us know where the philanthropic constructors are based?

[kjk]

Originally Posted by elcreative

And it's amazing to see that it costs nothing for the case, assembly, quality control, packing and shipping... do you think they'd let the rest of us know where the philanthropic constructors are based?

lol, that's one of the jokes in the industry about firms like iSuppli (another "estimator"); that they purposely lowball their estimates to get clients to ask them who their incredibly cheap sources are-which they will gladly tell you for a fee

[OtterBooks]

Originally Posted by elcreative

And it's amazing to see that it costs nothing for the case, assembly, quality control, packing and shipping... do you think they'd let the rest of us know where the philanthropic constructors are based?

Apparently in the same philanthropic office building occupied by Amazon.

[carld]

That's all covered under "Other".

[elcreative]

Originally Posted by carld

That's all covered under "Other".

Other lists one specific item - the battery... if the rest is covered then there is more than enough room to have added half a dozen or so words saying so... my comment is simply based on the chart not on assumptions or what I think may be included... the only item, where Other covers such things, is the iPad...

[=X=]

Originally Posted by elcreative

And it's amazing to see that it costs nothing for the case, assembly, quality control, packing and shipping...

Their basing the cost off of the know cost of the Playbook(not sure how they figured this out). Considering they're using the same vendor and same product. The chart mainly lists the differences in component cost and their cost.

Originally Posted by elcreative

do you think they'd let the rest of us know where the philanthropic constructors are based?

I didn't know you worked in manufacturing is that the new PC term for "slave labor".

[wodin]

Originally Posted by elcreative

And it's amazing to see that it costs nothing for the case, assembly, quality control, packing and shipping... do you think they'd let the rest of us know where the philanthropic constructors are based?

Not to mention the motherboard.

[carld]

Originally Posted by elcreative

Other lists one specific item - the battery... if the rest is covered then there is more than enough room to have added half a dozen or so words saying so... my comment is simply based on the chart not on assumptions or what I think may be included... the only item, where Other covers such things, is the iPad...

I was kind of being facetious. I don't know how reliable these numbers really are. I don't think there's any doubt that the Fire is the cheapest of the three. But actual numbers? I've no clue.

[elcreative]

Originally Posted by =X=

Their basing the cost off of the know cost of the Playbook(not sure how they figured this out). Considering they're using the same vendor and same product. The chart mainly lists the differences in component cost and their cost.


I didn't know you worked in manufacturing is that the new PC term for "slave labor".

But it still provides a total figure for costs... if you don't factor everything in then it's not even a total let alone an accurate total.

In this case it's just the name for the obviously nice people who must build things for free...