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Jeff Bezos revealed to the BBC that Amazon makes no profit off the Kindle Paperwhite and Kindle Fire HD. Both devices are sold at cost, which means, both devices’ price is how much it costs Amazon to make them.
That selling hardware for no profit is certainly much different from Apple’s strategy (it makes a profit on every iPhone and iPad sold) but not so different from video game companies who’ve traditionally sold their consoles (Xbox 360, PS3, etc.) at a loss. The thinking there is to make up the profit lost in the console with the cost of games and peripherals. That’s the same with Amazon. Use a Kindle and you’ll be buying stuff through Amazon. It’s like Amazon is providing everybody with slick shopping carts in tablet form.
Amazon has said that it doesn’t care much about making money off the hardware products, effectively saying it doesn’t care about people buying its products but rather people using its products. As each Kindle and Kindle Fire is tied to Amazon’s ever growing, sell everything store, it’ll still be making off Kindles and Kindle Fires anyway. Just not the old fashioned way. [BBC]
BUY not BY
aaaaaaaaaand it’s gone. Now we can focus on the stupidity of the rest of the article
“by” :’(
Unbelievable typo in the headline there.
Have just actually read the article rather than the headline. Haven’t Amazon been selling the Kindle range at cost since day dot?
This is not news.
Have you only just realised this is the Amazon model with the Kindle line? Can I have your job?
Are you in a bad mood this week? You’ve been a little bitchy in your comments lately. Can’t we please have the old lovable Darrell back next week please.
I have been in a bit of a bad mood, it’s true, which makes me short tempered with stupidity (as I see it). Actually feeling a lot better and have just had a bacon roll too, so should perk up shortly, please stand by.
Dammit now I feel like a Bacon Roll
Unless it’s an Apple article (and we’re going to get soooooooooo many iPad mini articles), in that case, bitch away.
Sorry Darrell. Your comment was far to coherent and lacks sufficient condescending/simplistic explanation for you to qualify.
You know as well as anyone here I can be as incoherent and condescending as anyone here. I just happen to be sober right now.
I love that you thought it necessary to explain what “selling at cost” meant.
The “old fashioned way”? How long has Gilette been selling razors?
Since 1903, though I don’t know if the blades cost more than the razor back then.
No first hand experience Darrell?
Cheeky Git, I am not THAT old. I remember my dad shaving with the old disposable blade type (and me cutting myself when I tried to immitate him when I was very young) and my granddad using a straight razor till the day he died.
As opposed to what? Figuritively losing money?
If they’d sell me a Paperwhite here in the UK I’d gladly add £10 for some profit for them!
http://www.amazon.co.uk/dp/B007OZO03M/ref=swm_kndl_grphc?pf_rd_p=330289007&pf_rd_s=nav-sitewide-msg&pf_rd_t=4201&pf_rd_i=navbar-4201&pf_rd_m=A3P5ROKL5A1OLE&pf_rd_r=0KBGXQNM8304AF76EYN6
Thanks….Although I notice we once again get ripped off, even assuming the non-ad version in the States is $139 which is around £86 and yet Amazon UK want £109, that’s £23 ‘profit’ for them…. now I’m on the fence.
Currently use Kindle on my Desire 3.7″ screen so if I get a 4-4.8″ new phone then maybe won’t bother with a Kindle as what I love is having my phone/Kindle on me all the time, not having to remember another device which I’ve been ripped off over.
It is really only £6 of profit because the UK has tax which the US one doesn’t.
I got a Kobo a few months ago and there is a very big difference reading on that to my phone – now I don’t even bother reading on my SGS3 because it is so much easier to read ereader for longer. I’m not sure I’d got for a Kindle just because of the price and Amazon’s DRM policy, but getting an eReader has been a revelation.
Ah, so I assume the tax is added later in the buying process depending on which State you live in (and their State Sales Tax).
I get what you’re saying about eReaders but I love the convenience of always having a book on me (because I’ve always got my phone), so I think I’m talking myself out of buying one. Hmmmm.
Buying things is a pain in the US since tax isn’t shown on the price tags. It gets added on when you get to the tills. Pain in the butt.
So can they explain why the US version costs £40 less per unit to make than the UK version?
Edit: Was looking at and old price for it in the US, and ours has the tax on it.
every time i see the word literally in a giz post
https://www.dropbox.com/s/uf0u36cx94bmyyf/literally.wmv
glad im not the only one that gets bothered by that.