Kindle Sales Plummet


Apple (NASDAQ:AAPL) had reported a big jump in iPad sales when it announced its earnings last month, and it turns out the growth has been reflected in its overall tablet market share. The iPad widened its lead in the market to 68 percent, up from 55 percent in the holiday quarter. Amazon’s (NASDAQ:AMZN) Kindle Fire may have been branded a best seller by the company, but IDC finds its share in the market actually saw a big fall, to about 4 percent from 17 percent in the fourth quarter.

Actually, I doubt Jeff Bezos is exactly quaking in his boots. The Kindle Fire serves primarily to direct owners to Amazon Prime, thus becoming lifelong members of Amazon’s $80-a-year club. I’ve been a member since Day One, and a very happy one at that.

No, Amazon has something bigger in mind. Here’s Jason Gilbert with the details:

Starting now, Amazon is accepting ideas for TV shows from anybody who has a pilot script, an idea for five or six episodes, and an Internet connection. Amazon says that it wil be selecting one idea per month to put into development. If it passes muster and Amazon decides to produce a full slate of shows, the creator will be given $55,000, up to five percent on sales of licensed merchandise, and “other royalties and bonuses,” per a press release from Amazon.

Which leads John Nolte to conclude:

The message here is bold and in-your-face: If Hollywood wants to protect their bundled cable monopoly, we’ll just take it to the next level and not only provide a more democratic way to watch content, we’ll also produce our own damn content without you.

There’s only so many hours in the day and if Amazon and Netflix are able to fill our hours with enough licensed and original programming, Hollywood will not only lose the corrupt power base of bundled cable, they will have created competition for content itself.

To succeed here, Amazon doesn’t need to beat Apple. In fact, I fully expect that someday soonish, the Kindle App on your iOS device won’t just be for books. Instead, it will also stream Amazon Prime video content.

And why not? Amazon might be breaking even on Kindle Fire hardware sales. They need Prime subscribers to make any real money. So long as Amazon can lure customers into Prime, it doesn’t matter whether they came in via a Kindle or an iPad — Bezos still gets his $80.

The $64,000 question is: Will Apple allow Amazon to add streaming to the Kindle iPad app, or will they force it to remain a book reader?