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Digitimes: Kindle Fire prices to drop to clear stock for upgraded model, coming at the beginning of third quarter

June 15, 2012

Amazon’s Kindle Fire has been on the market for exactly seven months today, and it looks likely that before the 7-inch tablet reaches its first birthday it will be revised and updated by Amazon. It is also likely that the 7-inch version will be joined by a little brother.

According to a recent report by Digitimes, Amazon is preparing to lower the price of the Kindle Fire to $149, in an attempt to clear out older stock before the new line-up appears. The same report says that the new models will come at the beginning of the third quarter.

Combine this with the anticipated release of the Kindle Fire outside of America and it could mean that Amazon isn’t just planning to unleash the first generation Fire on Europe, but rather a whole new line up. It is estimated that Amazon managed to sell around 4.5 million Kindle Fires during the first few months of its launch, however the company only managed to sell a further 800,000 during the first three months of this year. By releasing the Kindle Fire in Europe and by revamping the lineup (including possible permanent price changes) Amazon hopes to boost sales.

So what can you expect? First, the original Fire will drop in price to $149 – to start  clearing the existing stock. Then Amazon will announce and launch the new line-up as well as the expansion into Europe. The new line-up will probably comprise of three models. A new 10.1-inch version, a better 7-inch model with a greater screen resolution – maybe even as high as 1280 by 800 – and a refresh of the original version with the same 1024 by 600 pixels screen.

Details on the 10.1-inch version are thin on the ground, but it will need to have a good features list and be aggressively priced to compete with the offerings from Apple, Samsung, and the Google tablet coming at Google I/O.

Why two 7-inch versions? Pricing. Amazon could be trying to push even harder into the budget markets by offering a revamped first generation Kindle Fire (probably with lower production costs) for just $149. Then the new 7-inch Fire, with the 1280 by 800 screen, will sell at the original $199 price point.

One thing is for sure, Amazon is very serious about the tablet market, and since Amazon (unlike other Android tablet manufacturers) has its own content to offer (films, music, books), its market share and dominance are almost guaranteed.

Do you own a Kindle Fire? Would you recommend it to someone else? What about a 10.1-inch version or a new higher resolution variant, are you tempted? Let me know by leaving a comment below.