Amazon may be planning to launch more than five different variants of the Kindle Fire, all with different display sizes, including a 10 inch model.
The original Kindle Fire had a 7 inch display, and was a fairly huge hit. However, with Google launching the Nexus 7, and Apple reportedly working on an iPad Mini, Amazon may feel the need to compete in different segments.
If it does decide to launch multiple tablets, we expect them to be priced extremely cheaply, at just about break-even levels. Amazon aims to make money not by selling tablet hardware, but by selling digital content to its tablet users.
It has been building out its digital content ecosystem over the last couple of years, and that could generate a significant amount of revenue in the coming years, boosting its low margins.
Since the launch of the Kindle Fire, Amazon’s share of the online video and music market has increased significantly. Amazon may also be planning to launch a smartphone soon, to compete with the iPhone and other Android smartphones.
We certainly expect to see at least a smartphone, a 7 inch Kindle Fire and a 10 inch Kindle Fire before the end of the year. However, 5 to 6 different models may be a long shot. In any case, we will know soon.