Kindle Fire, a business question

The Kindle Fire is a wi-fi only device which is first and foremost designed to consume content from Amazon. I wonder whether the business model would support Amazon offering free mobile connectivity (3G) with the Fire, as it did for the Kindle.

From the consumer’s point of view, the benefit is obvious, even if there is a charge or some data cap to access non-Amazon content (like browsing or using non-Amazon apps).

From the carrier’s point of view, this would solve a pricing problem (how to charge for connectivity and bandwidth), as they would get paid more or less proportionally to the bandwidth used.

Finally, for Amazon this would greatly increase the attractiveness of the Fire to consumers, simplify the consumer’s experience (no data contract, no monthly fee or data cap except for non-Amazon services), and help sell more of its content.

The question is whether this is financially doable. It seems to have worked for the Kindle. But e-books do fetch a higher price relative to bandwidth than do movies or music.


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