
Kindle Fire HD hurts Microsoft more than Apple - evo_9
http://www.cringely.com/2012/09/07/kindle-fire-hd-hurts-microsoft-more-than-apple/
======
DaNmarner
> “if Apple gives up its position” which it clearly hasn’t.

so, moot?

> Amazon is copying Apple’s playbook, page-by-page...

> What, after all, has Amazon (or Microsoft) actually invented here? Nothing.
> They’ve emulated Apple at a lower price point and to some extent
> disintermediated the mobile carriers.

Not according to Jeff Bezos, who spend a good portion of his presentation
explaining how Amazon make money with their pricing strategy of the Kindles.
The difference between iPad and Fire HD is not in price, but in their
producers' business models.

The author clearly doesn't get it.

~~~
objclxt
> Not according to Jeff Bezos, who spend a good portion of his presentation
> explaining how Amazon make money with their pricing strategy of the Kindles

He may have explained how they _want_ to make money, but I don't recall Amazon
or Jeff Bezos ever having stated the Kindle Fire has made them a profit.
Indeed, Amazon have been very reluctant to even release hard sales figures for
the Kindle Fire.

~~~
greedo
Amazon's fans seem to think that Amazon can sell a tablet at near cost and
make money on either digital sales (movies/books/audio) or as a kiosk to sell
physical wares.

What makes them think that they can outdo Apple in the first category? Apple
which clearly has a huge installed base, yet runs the iTunes store at break
even.

And using tablets as a kiosk might add some value to Amazon, but is it really
necessary? Are iPad/Nexus 7/Surface users going to magically find a
better/cheaper online merchant?

------
lmm
>Apple is the innovation leader. What, after all, has Amazon (or Microsoft)
actually invented here? Nothing.

It's not like Apple invented anything either. As with most things they do, the
ipad's secret was not innovation but polish, taking existing technology and
putting in the integration and software effort to make turn it into a great
user experience. I'm not saying this isn't valuable, but it's fundamentally no
more or less innovative than what Amazon's doing (making the same experience
available at lower cost).

Of the three Microsoft is the truly innovative company. E.g. many of the ideas
behind iOS' sandboxing mechanism originated at Microsoft Research.

~~~
berntb
>>the ipad's secret was not innovation but polish [which is no more innovative
than selling products cheap to earn money on content, Amazon Kindle style]

Uhm, no one on the planet knew how to build an affordable pad that would be
interesting outside niches. Microsoft tried for a long time, too.

Then comes the iPhone/iPad. The market, the _world_ , is different.

I do smell a bit of spin in what you wrote... :-)

~~~
lmm
If you're talking about changing individual people's lives, I'd be willing to
bet that the amazon effort will eventually reach more people than apple did,
simply because the market at $299 is a lot bigger than that at $499.

If you're talking about showing the world what's possible, those of us who had
tablets years before the ipad could see that. The software was clunky, but if
you were willing to spend time learning and work with it (which, yes, is a
niche market) you could do everything you can today.

What apple did was undeniably a huge step forward. But I don't think it was
qualitatively different from those who came before or after, and I think
chalking up their success to "innovation" is missing the point.

~~~
seanmcdirmid
Innovate on the experience, not just the features dammit! I'm really tired of
hearing this refrain that Apple is not innovative because all they do is take
existing features and put them into....a package that people can actually
use!? But then "isn't that the easy, uncreative, uninnovative part?" Yes,
building usable experience is innovation, and yes its very important.

~~~
lmm
>"isn't that the easy, uncreative, uninnovative part?" Yes, building usable
experience is innovation, and yes its very important.

If you consider that to be innovation, surely offering an equivalent product
at a substantially lower price (as amazon is doing) involves just as much
innovation.

~~~
seanmcdirmid
Apple innovates on the experience, but they've also refined their supply chain
(actually, Cook's main contribution). That is more good engineering than
innovation (we can even argue if good engineering is innovation in itself, but
its kind of pointless). Amazon has come up with an interesting business model
by focusing more on content sales to offset low hardware prices, whereas
Apple's thinking is quite the other way (content supports hardware sales, not
the other way around!). If you want to call that "innovating on business
model", I won't argue with you, but now the term is so diluted that its not
very meaningful. My original point was that Apple did a lot of work to bring
products to market that were usable and didn't suck, and that is really the
innovation that most people acknowledge and notice.

"just as much innovation" is such a weird term, how do you actually measure
innovation? At least this isn't another "Apple is successful b/c of their
marketing" argument, which is bogus since their marketing budget was (until
recently) absurdly low compared to other companies in the same industry.

~~~
a45l98
"their marketing budget is extremely low compared to others in the same
industry"

Any pointers to the figures?

Apple's marketing seems unlike any other hardware manufacturer I can think of.
But maybe that's just my perception. When you're watching a film and the
camera makes a special pan around a laptop to show the Apple logo, it's hard
not to think "This hardware company really puts a lot of effort into
marketing. This is not your ordinary hardware company." I have seen Dell do
this sort of product placement on occasion, but nobody seems to do it to the
extent Apple does.

That's just the tip of the iceberg. To discount the amount of Apple marketing
and its effects as "standard for the industry" or even below standard seems a
little like willful blindness.

~~~
seanmcdirmid
<http://techcrunch.com/2010/10/27/apple-ad-spending/> quote "And while $691
million may seem like a massive amount of money, it’s still less than half of
what Microsoft spent on advertising last year. And it’s less than what Dell
spent last year."

I'm not sure what the case is like today, I'm sure its gone up a bit but would
be surprised if they surpass Microsoft yet. Apple doesn't pay for product
placements; see [http://www.businessweek.com/articles/2012-05-10/apple-the-
ot...](http://www.businessweek.com/articles/2012-05-10/apple-the-other-cult-
in-hollywood) quote "The cast’s (Gossip Girl's) sudden conversion cost the
Cupertino (Calif.)-based iPhone maker nothing. Apple has spent decades
strengthening its subtle but powerful grip over Hollywood, and unlike many
companies, says it never pays for its products to appear on television or in
movies."

Apple doesn't SPEND much on marketing, but the marketing done is incredibly
effective. Turns out, just having the best product makes the job much easier.

~~~
a45l98
"Turns out, just having the best product..."

This is why Apple gets a bad rap in the forums. Who would say that that about
their computer (except a Linux weenie)? The reality is these are cheap
electronics in a hermetically sealed but stylish enclosure that use publicly
available OS configured for dummies. So simple is the design they can be used
by lower primates.

I like Apple hardware, it continues to look good after all these years, but
comments "Turns out, having the best product..." make me like it a lot less.
Apple is attracting some brainless users and will be catering to them more and
more. This is not good.

Maybe this userbase explains the product placements. Hollywood wants to convey
a sense that a character is not the type of person that would know anything
about computers, hence she uses Apple products.

Touche.

And thanks for the links.

~~~
seanmcdirmid
The truth is brutal: they build the right products, they practically sell
themselves, and once they've reached critical mass, what else do you expect
them to do? Now you bring out the sheeple argument...ah...ok...

At all the computer science conferences I go to, Macs outnumber PCs; no I mean
they actually dominate PCs! Now Apple has cultivated an image that the
smartest people use Macs? Or maybe these people just use macs b/c they are the
best coding machines out there, and they really don't care paying more that?
Or maybe we CS PhDs are just sheeple and like shiny things just like less
technical users?

Really?

~~~
a45l98
No. Apple has always been popular with intelligent people (whether they are
technical or not) and it has always been the best choice for certain uses.

But things are changing. First they started selling mp3 players. Then phones.
Now Etch-A-Sketches. And now we have CS PhD's getting defensive about their
choice to use Apple computers. New types of users. New focus.

Xcode makes for "the best coding machines"?

You mean that's better than a machine that comes with a compiler already
installed and ready to go?

With no certificates? And No hoop-jumping?

How is it better?

~~~
seanmcdirmid
(I'm not downvoting you , just so you know)

If you know if a laptop that is better than a high-end macbook pro, please let
me know. I mean, please...I'm not supposed to use Macs myself given who I work
for...I am desperate for a decent work laptop without a fruit logo on it.

Sometimes MBPs are bought and Windows/Bootcamp is installed, sometimes they
install Linux, sometimes OSX is perfectly OK because they are using Eclipse or
some other cross platform IDE anyways. And their are those that actually do
Mac/iOS development. Fun stuff.

~~~
a45l98
(I know it's not you. You seem like a cool guy. But looks I've gotten under
someone's skin, lol. Sorry, whoever you are!)

It really depends on what you want to do with the computer. There's no
shortage of forum debates on the merits of one computer over another without
any mention of the intended use. That's pretty silly when you think about it.

Can't you cover up that logo with a sticker? (Taking a tip from the movie
studios in the businessweek article.)

I don't think you are buying the MBP just for the specs though, are you? I
mean, the enclosure, Cocoa graphics layer, all that ease-of-use must factors,
right?

If you are saying MBP specs really are the best for a laptop in that price
range, then you have made me curious.

My solution to the hoop-jumping for development would be to boot another OS,
that already has a compiler installed, from USB. But I'm not even sure that
would work. I'm not writing stuff in Java or ObjectiveC. I just want a working
clang/gcc.

~~~
seanmcdirmid
Just one more post in an argument that is probably misplaced and not very
interesting to anyone else besides us :).

It used to be that buying a Mac was a hard decision. Not only were they more
expensive (not a great value), but you also had to give up performance
(especially in the PowerPC age) and app availability. Today, you no longer
have to make those hard decisions, while the PC vendors have gone low end and
have let their quality fall dramatically (which wasn't that great to begin
with). That I say macs today are the "best" computers we can buy have
something to do with Apple continuing to focus on quality, having value that
compares to the PC vendors, and the PC vendors having sunk into a race to the
bottom with each other, leaving Apple free to reign over the +$999 market.

So just show me a laptop that is "as good as" the the retina MacBook Pro that
comes in at +$2000, a price I'm willing to pay (be it me or my employer, I'm
worth it given how much time I spend using my computer). I honestly can't find
anything that compares in the PC zone, and believe I've tried!

~~~
a45l98
(I've ended up with +2 karma despite being sandbagged! =)

I would have to do some research to be of any use to you with respect to
lappies over $2K. My focus is on ARM development boards and embedded systems.
I am looking at the opposite end of the spectrum: low-power, highly portable,
cheap computing. For the common man and woman. Alas, the forbidden fruit keeps
popping up at this end of the stick too. Cupertino is no longer content to
just sell high powered high-priced development machines. It's not the same
company as when I bought my first Mac.

I can't wait to see the first low-power Apple ARM devices where they will
attempt to sell a $20 computer, locked down like Fort Knox, for several
hundred bucks. What new gimmicks will they use to maintain the reality
distortion field? It should be most entertaining.

Clearly you are not of the Apple cult, just a guy looking for a high-end
laptop. My apologies for mistaking you for a fanboy.

------
TazeTSchnitzel
> What, after all, has Amazon (or Microsoft) actually invented here? Nothing.
> They’ve emulated Apple at a lower price point and to some extent
> disintermediated the mobile carriers.

Well, perhaps Amazon. But while Microsoft have emulated Apple in hardware a
little, they certainly haven't with the OS. Windows Phone 8 and Windows 8 have
a very different, very fresh UI. They only use some of the same gestures,
even.

~~~
AlisdairO
And, indeed, MS were responsible for a bunch of pre-ipad touch research that
helped shape current UIs.

------
ams6110
_just as Apple had to accept competition in the MP3 player market, Cupertino
will have to adapt to the Kindle Fire HD._

Did Apple "accept" competition in the MP3 player market? There were mp3
players before the iPod. Apple came into the market and absolutely owned it.
Portable music = iPod. That's the end of the story.

------
ChuckMcM
I'm not a big fan of Cringely's but I do enjoy this particular insight. It is
unclear to me that Microsoft is even in the same game here because of their
lack of content.

Specifically Amazon innovated in the book space, its in their roots and they
have leveraged the crap out of it. Apple if you recall innovated in the music
space. The similarities are stunning, take something people continually
consume, is fashion driven, and reduce the friction of that consumption,
golden. The 'chunkyness' (in terms of price per transaction) is bigger in
books than in music but the mechanisms are similar. All we need now is NetFlix
to introduce a dedicated 'video' device, then move up to phones and tablets.

------
inthewoods
I disagree - I've been considering buying a tablet just for my kids, and
Amazon has put a better option on the table for parents. I can't tell you the
number of times I've found my kid browsing some Youtube videos or in the Apple
store after being upsold something in the game itself.

So for me - and I expect for other parents if they can get the word out -
Amazon is making a play for my Apple business.

Still amazes me that Apple didn't see the kids/children's market and provide a
better solution than the restrictions - I mean they are ok, but the lack of
separate profiles means I'm constantly tweaking them as I work on the iPad,
then my son grabs it, etc.

------
jpxxx
Who is this author? Since when does "disintermediating an industry" mean
"selling and subsidizing the products of an industry"?

And what pundits -didn't- predict a larger Kindle Fire? I thought that was a
signed and sealed rumor straight from WSJ+Amazon themselves.

~~~
eli
The author has been around quite a long time, but he is better known lately
for his (perhaps intentionally) counterintuitive opinions and goofy
predictions. I think, sadly, he is going more for pageviews than credibility.

But to answer your second question, _"Amazon next week will announce two
7-inch Kindle Fire models, one with new hardware and the other an updated
version of the original, CNET has learned. That's counter to rumors it would
launch a larger version."_ Oops.
[http://news.cnet.com/8301-1035_3-57504515-94/kindle-fire-
won...](http://news.cnet.com/8301-1035_3-57504515-94/kindle-fire-wont-go-big-
to-take-on-ipad/)

------
a45l98
Cringely is at his most prophetic in the comments when he says: If Facebook
drops much lower Microsoft might make a play.

Try to list all the reasons Microsoft should not buy Facebook.

Try to list all the reasons Facebook would resist acquisition by Microsoft.

------
cooldeal
>The tablet market was already broadening, flattening, and moving down market
before yesterday’s Amazon announcement

Right, but Microsoft is trying to bring it up market with the Surface Pro and
other small x86 tablets(many of which seem to come with a keyboard or a laptop
style dock, sometimes optional). Eg. see
[http://www.engadget.com/2012/08/30/hp-envy-x2-laptop-
tablet-...](http://www.engadget.com/2012/08/30/hp-envy-x2-laptop-tablet-
hybrid/)

As I posted in another comment a few days ago, They will be expensive, but far
more capable and powerful(heavier and less battery life too). For example,
they can run the full Visual Studio or Eclipse.

You can take a Surface Pro and a Kindle Fire with you, run Eclipse with the
Android SDK loaded, connect the Kindle Fire to the Surface and take the
program you just wrote on the Surface and run it on the Kindle! Or write your
code while on a roadtrip or on the subway and debug it on your Android or
Windows phone(don't know how Hackintosh it can get for running apps on the
iPhone).

Can you do that with a Kindle, iPad or any other tablet on the market right
now, which are used by most people as consumption devices?

Where Microsoft is competing with the Kindle, Android tablets and the iPad is
with Windows RT, which is a different beast(and costs less than $100 for OEMs
+ they are rumored to get kickbacks on ecosystem sales). The only big
advantage Microsoft has right now in this space is Office RT. Amazon's tablets
are oriented even more towards content consumption(read Amazon's content) than
the iPad. It all boils down to how much consumption vs. 'creation' the
consumers want to do on their tablets, or if they want to get one device that
does it all.

~~~
archangel_one
So these new Surface Pro things are going to be like a current ipad-style
tablet, but with a keyboard, heavier, have shorter battery life and be more
expensive. That sounds very much like a device I already have, which is called
a laptop. It runs Eclipse pretty well on the rare occasions I want it to.

Less than $100 is still a pretty hefty tag in this market too; that's half the
price of a Nexus 7! I think Microsoft are going to have to learn that this
market isn't going to allow them the huge margins they've traditionally
enjoyed on PCs.

~~~
cooldeal
>So these new Surface Pro things are going to be like a current ipad-style
tablet, but with a keyboard, heavier, have shorter battery life and be more
expensive. That sounds very much like a device I already have, which is called
a laptop. It runs Eclipse pretty well on the rare occasions I want it to.

This reminds me of the folks that discounted the iPad because it was not good
as a smartphone for portability(oversized iPod Touch) and much less powerful
than a laptop. Predictions based on personal anectodes in a billion plus
device market are a dangerous thing.

I agree that the Surface Pro is trying to create a new market here(spaced
between iPad style tablets and the laptops/MB Air/Ultrabooks which is an
uphill task, but I do think there are a lot of people who want a no-
compromises powerful portable tablet for on-the-go use.

~~~
seanmcdirmid
The tablet market, at this moment, is going the other way, to include devices
that are cheaper, a bit smaller, and more oriented toward pure consumption
(Nexus 7, Fire HD, iPad Mini). This market has lower margins but the potential
for lots of sales even beyond the iPad today.

Now Microsoft comes with Surface (Pro and non-Pro), sounds like they are going
after niche high-end tablet markets (those who want Office + a keyboard), and
higher-end tablet markets (though who want to run Visual Studio). Completely
opposite direction that at best will be a successful ultra-book. I'm not
seeing mass appeal, but a lot of that will come down to pricing.

~~~
cooldeal
New products can and do disrupt market trends, especially in such a huge
market.

> sounds like they are going after niche high-end tablet markets (those who
> want Office + a keyboard), , and higher-end tablet markets (though who want
> to run Visual Studio).Completely opposite direction that at best will be a
> successful ultra-book.

Niche in this market mean at least tens of millions of people. Not to say that
the Surface Pro will succeed(pricing is important as you say) but the
laptop/ultrabook market is still much bigger than the tablet, both the install
base and sales.

