Black Friday is three days away and Cyber Monday is six days away. It's the season for e-commerce (finally).
Everyone's eyes have been following the new iPhone and iPad, but this comes with no surprise. Apple's success has never been remotely questionable, especially at a time close the highest grossing shopping season in the year. Even with the said "letdown" of the new iPhone, Apple had the iPad2 backing the company up. What people may not have expected, however, is the timely increasing popularity of Amazon.
With the release of the new Kindle Fire, Amazon has a hope of taking the spotlight in the Cyber-weekend market. Undoubtedly, the Kindle has it's perks- it has a dual-core 1GHz processor, 8GB storage, and the best part is it's only $199 and allows free Amazon-content streaming. It's made the "Top 10 Most Wanted Gifts and Gadgets of Black Friday 2011" and "Top 5 Back to School Gadgets for 2011", right up there with Apple. Here's a product that might actually stand a chance against the iPad2 and steal some of their sales.
The current Amazon stocks reflect none of this though. Can the online retail king handle it?
Wall Street is predicting Amazon's total sales in the 4th quarter to reach $18.2 billion, up 40% from last year, and yet stocks fell nearly 10% recently and are now about 25% below the 52-week high they set last month. The Kindle Fire is likely to be a loss leader for Amazon, but the hope is that the costs will be balanced with all the books, magazines, and other content available with the purchase of the Kindle (common with most e-readers). The problem is that Amazon is relying heavily on future success. With its expanding distribution, huge international market participation, and common usage of free shipping, if the Kindle doesn't do well it has the potential of dipping steeply into Amazon's profits.
All this can change quickly with the sales of the upcoming cyber weekend, but all we can do is wait and see: will the Kindle Fire prove to go beyond expectations or fail to deliver?
--Priya Saksena
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