While The iPad Is Safe, Amazon’s Kindle Fire Torches Low-Cost Android Tablet Prospects

What many analysts earlier presumed to be a shot across Apple’s bow, after Wednesday’s unveiling of Amazon’s Kindle Fire tablet, could actually torpedo the chances of inexpensive Android devices to challenge the iPad. Android tablets, unable to match the iPad’s features and design were hoping to undercut Apple’s pricing — that is until news of the Fire’s $199 price tag.

With the Kindle Fire reported to cost just $150 for Amazon to build, iPad rivals will likely suffer, not Apple. “Android manufacturers who really have no way to compete since the channel markup would require companies put their tablets at or below cost to be the Kindle Fire price — and they still lack the content that the Amazon storefront has,” Jeffrey Brown, vice president of TechInsight business intelligence, said in a Wednesday report.

Perhaps one of non-iPad tablets hardest hit by the Kindle Fire is RIM’s PlayBook. The Fire is essentially the PlayBook, except stripped of all the bells-and-whistles. Ticonderoga analyst Brian White Thursday told investors the Fire targets a “tablet-light user on a tight budget that may not have yet purchased a tablet or already using a Kindle.”

Until the Fire was introduced, RIM’s $499 low-end 16GB PlayBook — already with dismal sales — was slashed by $200 to $299 at Best Buy. The Fire’s introduction may require Android players to scramble even more, refining their competition. If they can’t compete with Apple on features and they can’t compete with Amazon for price, what’s left to draw consumers?