Amazon: Kindle Fire HD Focuses On Services, Not Devices

Amazon's Thursday unveiling of its new Kindle Fire HD Wi-Fi and 4G LTE tablets, as well as new versions of the Kindle e-reader, went far beyond the introduction of new hardware and instead focused as much time on new services to go with the devices.

Those services -- which include new self-publishing capabilities, the ability to get more information about a character in a book or an actor in a movie with a touch of the screen and enhanced time limiters for children -- are key to the philosophy of Amazon, said CEO Jeff Bezos.

Bezos, speaking live at the Santa Monica, Calif., airport to a crowd of press and analysts, said that there were a couple dozen different tablet PCs introduced to the market in the last year, but few were purchased.

[Related: Amazon Unveils Kindle Fire HD To Rival iPad ]

"Nobody bought them," Bezos said. "Why? Because they were gadgets. And nobody wants gadgets. They want services."

The Kindle Fire from day one was designed to be a service that knows its users by name and quickly and easily provides the content users need, Bezos said.

"A hardware device as a service," he said. "That's what everybody wants. ... Hardware is a critical part of the service. Absolutely essential."

To prove his point, Bezos spent much of his time demonstrating some of the new online services and user-friendly features Amazon is introducing to go along with the new mobile devices.

However, it was the devices themselves that drew the most attention.

Amazon introduced the Kindle Fire HD tablet, commonly referred to prior to the launch as the Kindle Fire 2. The Kindle Fire HD features a high-definition 1,900-by-1,200 display, a wide viewing angle and a 25-percent reduction in glare over previous models. The glare reduction stems from the lamination of the touch panel directly on the display to eliminate the air gap. It includes an HDMI port for connecting to larger displays.

The Kindle Fire HD also features the Texas OMAP4470 processor with 50-percent more IOPS and 40-percent more bandwidth than the Tegra 3 processor commonly used in other tablet PCs. It also includes both 2.4-GHz and 5.0-GHz Wi-Fi with dual antennas.

NEXT: Introducing The 4G LTE Version

With 16 GB of local storage, the 7-inch model is expected to ship on Sept. 14 with a price of $199, while the 8.9-inch model is expected to ship on Nov. 20 priced at $299.

Amazon's Bezos also unveiled a version of the Kindle Fire HD that includes 4G LTE wireless technology that he said will ship on Nov. 20. The base model includes 32 GB of storage and will list for $499.

The Kindle Fire HD 4G LTE model will be matched to a data plan that provides for 250 MB of data per month and 20 GB of cloud storage for a price of $49.99 per year.

Bezos compared the cost of the device to that of Apple's new iPad, noting that the first-year cost to own the new iPad, including purchasing the device and paying for data service, totaled $959, compared to only $549 for the new Kindle Fire HD 4G LTE.

"We've not just built the best tablet at that price," he said. "We've built the best tablet at any price."

The Kindle Fire HD and its 4G LTE cousin will be launched with a number of important applications customized to take advantage of the new mobile platform, including Facebook, Skype and a version of Microsoft Exchange Bezos called "world class."

Bezos also demonstrated several other services, including Whispersync for Voice, a new service that allows users to switch between audio and written versions of Kindle e-books without losing their place; X-Ray, which allows users to touch the name of a character in a book or an actor in a movie to automatically pull up details; and Kindle FreeTime, which lets parents set different time limits for different applications used by their children. With FreeTime, for instance, parents could allow unlimited time for reading but put a 30-minute limit for playing games, he said.

For students, Bezos demonstrated X-Ray for Textbooks, which allows textbook readers to touch the screen to highlight a term or concept and get access to a wide range of multimedia information, including YouTube videos, to better understand what is being read.

Bezos also introduced new versions of the Kindle eBook readers, including the Kindle Paperwhite, which features a patented light guide screen that distributes the light evenly across the display and reflects it down onto the screen for high contrast and easy readability in any light conditions.

NEXT: Amazon Looking For Revenue From Services, Not Devices

The new Kindle Paperwhite also features an 8-week battery life because, as Amazon's Bezos said, users may not want to turn it off. "You won't need to recharge your Paperwhite until Halloween," he said.

The Kindle Paperwhite lets readers adjust the font style and font size of their e-books, and it shows them how much time is left to read a chapter based on their reading speed.

The Kindle Paperwhite is expected to ship on Oct. 1. The price is $119, or $179 for a 3G wireless version. Amazon also dropped the price of its existing Kindle e-reader to $69 while giving it new fonts and crisper text than before.

Bezos said the prices for the new Kindle Fire HD tablets and Kindle Paperwhite e-readers reflect Amazon's philosophy of making money on the services that go with the devices and not on the devices themselves.

"We want to make money when people use our devices, not when they buy our devices. ... If somebody buys our device and puts it in a desk drawer, we don't deserve their money."

Unlike Apple, Amazon's pricing philosophy doesn't mean making money on the device, which would require forcing users to only use that device to access services, Bezos said. However, he said, Amazon is also not using the razor model, where the razor manufacturer loses money on the initial purchase to make up for it in how it prices razor blades.

PUBLISHED SEPT. 6, 2012