Friday, September 30, 2011

The Real Reason the Kindle Fire Costs $199 (ContributorNetwork)

A lot has been made of the rock-bottom price tag attached to Amazon.com's new multitouch tablet. The going theory right now is that Amazon hopes to make it up in volume; not volume of tablets sold (Amazon may well be taking a loss), but the volume of ebooks and other digital content sold. Amazon's closest competitor, Barnes and Noble, seems to have taken just such an approach with its Nook Color, which was already considered a bargain at $249.

Looking more closely at Amazon's announcement and product page, though, we can get a glimpse of its real agenda:

All it wants to do is eat your brains

No, not literally. But take a closer look at Amazon Silk, the "Revolutionary Cloud-Accelerated 'Split Browser'". That "Split Browser" thing means that your web browsing on a Kindle Fire is split between it and Amazon's EC2 cloud. Amazon's computers handle and "optimize" every web page you see before they're sent to your Kindle Fire, unless you turn that feature off.

The terms and conditions say that Amazon only temporarily logs the addresses of websites you visit. But according to the Amazon Silk FAQ, "Amazon Silk has the ability to learn about traffic patterns on individual sites over time." It's not quite eating your brains, but it does involve knowing what websites Kindle Fire owners go to!

The Mechanical Turk

That was the name of what was ostensibly an 18th-century chess-playing machine, and was actually controlled by a person inside it. It's also the name of Amazon's "marketplace for work" that pays people pennies for doing extremely repetitive tasks.

As Chris Espinosa notes, what Amazon Silk basically amounts to is a Mechanical Turk for indexing the web. Why would anyone want to do this? For "the knowledge of what other stores [its] customers are shopping in and what prices they're being offered there." Plus, by doing so it deprives Google of data; as far as Google sees, it's Amazon's servers clicking on all those links, not thousands of Kindle owners.

Still worth the price?

Even if everyone knew all of this, the Kindle Fire would probably still sell thousands of units. Or would it? We may never know, since Amazon's not exactly being proactive about telling people.

Is this really the reason Amazon's charging so little, though? Where would Amazon have gotten the idea to try this?

Well, if you look at one of the latest black and white Kindles, it now costs $40 more than the Kindle with "special offers;" that is, advertisements. That's more than the price difference used to be. Maybe Amazon's starting to learn just how much value it can extract from people ... after all, it has plenty of experience.

Jared Spurbeck is an open-source software enthusiast, who uses an Android phone and an Ubuntu laptop PC. He has been writing about technology and electronics since 2008.

Source: http://us.rd.yahoo.com/dailynews/rss/personaltech/*http%3A//news.yahoo.com/s/ac/20110930/us_ac/9844633_the_real_reason_the_kindle_fire_costs199

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