Amazon is hoping to make a dent in a tablet-computer market dominated by Apple's iPad. Amazon has been selling lower-priced tablets at thin, if any, profit margins to boost sales of digital items from its online store. As a result, it has been able to compete with the iPad on price.
The basic, 7-inch Fire model will cost $159, down from $199 for the original model. It will start shipping next Friday. The cheapest iPad costs $399 and the most recent models start at $499.
Amazon is coming out with a high-end version called Kindle Fire HD. It will have two WiFi channels for faster transfers. That will be crucial for high-definition movies and other large files, CEO Jeff Bezos said.
The HD model will also have more storage, starting at 16 gigabytes, compared with 6 GB for the old Fire. The iPad also starts at 16 GB.
A 7-inch model will sell for $199 and ship next Friday. An 8.9-inch model will go for $299 and start shipping Nov. 20.
That means a device nearly as big as the iPad will sell for at least $100 less. The Fire, however, won't have as extensive a selection of apps as the iPad. And while the HD models will have a front-facing camera for video chats, the iPad has one on the rear as well for taking photos and video.
Amazon also unveiled a premium Kindle Fire model, one with the ability to connect to the 4G cellular networks that phone companies are building. It will cost $499 and come with 32 gigabytes of memory and an 8.9-inch screen. A data plan will cost $50 a year.
Amazon also refreshed its line of stand-alone e-readers. Called Paperwhite, the new e-reader model has a black-and-white screen. It promises 25 percent more contrast. "The whites are whiter," Bezos said. "and the blacks are blacker."
The Paperwhite has a light source. Bezos says the device is "perfect in direct sunlight." Tablets such as the iPad and the Fire don't work as well in bright light because they are lighted from the back. Bezos says the light on the Paperwhite is directed down at the display. The device promises eight weeks of battery life, even with the light on.
It costs $119 and starts shipping Oct. 1. There's also a model with 3G cellular connections for $179. Amazon is also dropping the price of its low-end Kindle to $69, from $79. That will start shipping Sept. 14.
Amazon's stock increased $5.16, or 2.1 percent, to close Thursday at $251.38.