RTCRM POVs: Kindle Fire, October 2011


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Amazon's Kindle Fire is a significant departure from previous models; its features include integration with a user's Amazon.com account and a new browser.

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RTCRM POVs: Kindle Fire, October 2011

  1. 1. Kindle Fire – Amazon Enters the Mobile Tablet RingOctober 2011Rebecca Johnson, Digital Integration & InnovationTop-Level Points Summary On September 28, Amazon unveiled the Kindle Fire, a new class of its Kindle The Kindle Fire will be released reading device that represents a significant departure from its only in the U.S. on November e-ink reader focus. The tablet runs on a new browser, named Silk, which relies on 15, 2011 Amazon’s cloud (EC2) for major processing, rather than the device’s hardware. The Kindle Fire is priced at $199 The browser also analyzes user navigation to plan ahead and pre-load webpage and orders will be prioritized on data. Kindle Fire offers tablet users seamless integration with Amazon’s content a first-come, first-served basis libraries and shopping experience. In short, Kindle Fire is a new tablet offering consumers an affordable price, an optimized browsing experience and access to The Kindle Fire introduces Silk, a vast amount of content. which is Amazon’s new split and smart browser. Silk utilizes Amazon’s Elastic Computer Key Information Cloud (EC2), which diverts heavy processing away from the The Fire features a 7-inch tablet with a backlit tablet to create a faster screen capable of displaying 16 million colors browsing and viewing and has a 169 ppi (pixels per inch) resolution. experience Apple’s iPad 2, by comparison, has a screen The new tablet seamlessly resolution of 132 ppi. Amazon’s decision to connects with Amazon.com utilize a backlit screen for the Fire signifies a personal accounts and Amazon key departure from the company’s previous e- Prime ink–based Kindles. The Kindle Fire offers consumers The device weighs 14.6 ounces with 8 GB of on- a new type of tablet focused on device storage, contains a 1 GHz dual-core easy content access and processor, offers a Wi-Fi-only connection, consumption supports Adobe® Flash® Player and it has a continuous battery life of 8 hours. Fire does not have a camera or GPS, and is completely free of buttons, with a touch-screen as its control interface. Amazon’s “Silk” Web Browser One of the most talked-about features of Fire is its new Android-based browser. Silk is revolutionary because it diverts data-heavy browser processes from the tablet hardware to Amazon’s massive server fleet, the Amazon Elastic Computer Cloud (Amazon EC2); this division of labor is called “split browsing,” and makes Silk, which lives on the Kindle Fire and the EC2, the connector. For the end user Silk means a tablet free from heavy processing and thus able to provide a faster browsing experience and conserve battery life. While EC2 does the major processing for the Kindle Fire, EC2 also hosts many top sites and has relationships with major Internet service providers. This means that many Web requests never leave Amazon servers and also reduces the browsers’ transit time to milliseconds. RTCRM Proprietary Pg. 1
  2. 2. In addition to Silk’s split browser software, the browser observes user behavior across sites, detects patterns and canaccurately predict the next page content and navigation before the user requests it. These algorithms are based onAmazon.com’s filtering techniques that produce the “You Liked This, So You May Also Like This” feature. Silk’s “smart”browser functionality allows it to establish persistent connections with the sites users visit the most and pre-push content tothe tablet’s cache. This, as with EC2 integration, allows for a faster, more seamless browsing experience.To go with Silk’s enhanced browsing experience, the Kindle Fire offers users seamless access to and integration with Amazon’svast wealth of content; all Fire users need to do is either sign up for an account or link their Amazon.com account and they’llinstantly have access to 18 million movies, TV shows, songs, magazines and books, and the Amazon app store with thousandsof popular apps, such as Netflix, Pandora, Twitter, etc., and games like AngryBirds. It’s worth noting that the apps found in theAmazon app store, like those in the iTunes store, are heavily vetted and tested by Amazon.With purchase of a Kindle Fire, Amazon also gives buyers one month of free access to Amazon Prime, the membershipprogram that gives users free two-day shipping and reduced prices on one-day shipping onAmazon.com purchases as well as unlimited instant access to 10,000 commercial-free movies and TV shows on their KindleFire. After the free trial, users can purchase an Amazon Prime membership for the annual fee of $79.General Implications  Content consumption over creation. The Kindle Fire was never designed to store large files, which is best illustrated in the device’s relatively small 8 GB of storage and Amazon’s emphasis on document reading over editing in the Kindle Fire’s description. These hardware and software choices were specifically made to meet the demand of a large part of the consumer audience that wants to browse and view content, not create it. In a recent WIRED article, Amazon CEO Jeff Bezos, in comparing the Kindle to the iPad, said “It’s a different audience. We’re designing for people who want to read.” In the near future, look for Amazon to bolster its already vast content libraries in order to make the Kindle Fire even more distinct from the iOS (iTunes and iBooks)–dominated space.  New buyers to tablet market. New buyers to the tablet market will be faced with tough choices when it comes to their tablet purchases. Do they spend less to get less? Do they spend more and potentially not use all of the tablet’s capabilities? Or do they choose a device that gives them an intermediate option for a reasonable price? Time will tell, but it seems like Kindle Fire, with its middle-of-the-market positioning, is perfectly poised to pick up first-time tablet buyers. Also, expect Amazon to heavily market the Kindle Fire to current Amazon account holders because the tablet is an obvious extension of their Amazon accounts and the content they already purchase through these accounts.  Tablet switching. The Kindle Fire’s low price ($199) and its features and functionality will attract both high-end tablet users (iPad, Galaxy, Playbook, etc.) and low-end e-reader users. High-end users may flock to the Fire when their tablets become slow and outdated, as a lower- cost alternative. Additionally, high-end users may realize they don’t need or use all of their tablet’s bells and whistles, and decide they want a leaner machine. Low-end users may upgrade to the Fire because they want a tablet that can do more. Also, look for Amazon to heavily promote the Fire to current Kindle users as a step up from their current device, one whose benefits easily justify the small increase in price.  Silk transforms digital expectations. The Kindle Fire’s smart and split browser, Silk, will have ramifications outside of the tablet world. The browsing experience will raise user digital expectation with seamless content and lightning- quick service. Silk users will come to expect that type of service constantly, whether they’re viewing websites, using RTCRM Proprietary Pg. 2
  3. 3. apps or potentially even interacting with brands through offline channels such as call centers or in the store. If user expectations aren’t immediately met, users will look and go elsewhere, and the brand that provides them with this sub-par experience will look like an amateur.  Silk spreads beyond tablets. For the time being Silk will be strictly a tablet-based browser, but in the meantime, Amazon will no doubt begin thinking about taking the browser beyond the Kindle Fire. Mobile phones and laptops would be a likely next step, but what about at home? Imagine how seamlessly a partnership between Amazon and a major cable company or Internet service provider could create the ultimate content-providing service.  Mobile advertising heats up. With more and more consumers using their mobile phones and tablets to access videos, music, books, apps, websites, etc., mobile display and video advertising is becoming increasingly important. Kindle Fire takes content consumption to the next level and may offer new opportunities and challenges for mobile advertising.Pharmaceutical Industry Marketing Implications  7˝ screen further complicates compliance issues. With another screen size entering the ring, pharmaceutical websites will need to rethink how they design websites for readability, fair balance and presentation of a drug’s Important Safety Information. Because of all the various screen sizes and resolutions out there, marketers will have to make strategic decisions, hopefully based on Web analytics, on which browsers and screen sizes to optimize their sites for.  Kindle will remain an e-reader, not a medical tablet. Even before the Kindle Fire, when it came to the medical community, Amazon’s focus within the HCP community focused on e-reader versions of the major medical textbooks and journals, such as New England Journal of Medicine, Annals of Internal Medicine, Pediatrics, Journal of the American College of Cardiology, and approximately 90,000 more titles and publications. With Fire, Amazon doesn’t appear to be changing its positioning or game plan when it comes to the healthcare community. Although the Fire’s size makes it easier for HCPs to carry with them, the hardware (memory and lack of camera) and lack of HCP-focused apps in the Amazon app store make it more likely to be used as a reference rather than a medical diagnostic device or aid. Also, there are security and HIPAA concerns with Silk’s integration with EC2 and the cloud; this is likely to turn HCPs off from using it to send and record patient data. Given all this, it is likely that HCPs will use the Kindle Fire as an e-reader that helps them get quick and easy access to medical information and allows them to stay on top of professional literature.  Uptake with younger MDs, nurses, techs, etc. With tablet price points slightly too high for medical students and those healthcare professionals on limited budgets, the Kindle Fire may be just the device that gets them into the tablet market. Amazon offers medical journal subscriptions and textbooks for a wide variety of medical professionals, including significant resources for nurses. For med students and young doctors, the Fire gives them a financially feasible option for textbooks and references, and Kindle books are sold at a discount compared to the print versions. It’s possible that younger doctors, nurses and support staff will choose to adopt the Kindle Fire, and potentially become tablet loyalists, because of its price point, diverse medical practice content options and because it also provides them access to non–work-related content. RTCRM Proprietary Pg. 3
  4. 4. Recommendations  Keep current on tablet adoption. With the Kindle Fire not yet in market, it’s impossible to predict what adoption of the new tablet will be. In the interim, try to find out what the current mobile tablet and phone market looks like and how consumers are specifically using those devices.  Invest in a mobile site. While mobile website viewing is nothing new, the Kindle Fire is the straw that broke the camel’s back when it comes to whether or not to create a mobile-optimized version of a website. With this new tablet, more and more everyday, average consumers will be surfing the Web on a mobile device, and if a site isn’t built to provide them with a well-designed, easily touchscreen-navigable experience then you’ve lost them, and potentially lost them for good; marketers cannot afford to make that mistake. When it comes to designing a mobile site, marketers should optimize their standard website based on the top browsers and screen resolutions site visitors use to view their sites. For mobile phones and smaller-screen tablets (e.g. Kindle Fire), marketers should build sites that detect these devices and serve up the mobile site rather than the standard site. However, marketers should give mobile users the option to load the standard website with the caveat that it is not optimized for mobile viewing and usage. The RTCRM Digital Integration and Innovation team is tasked with keeping track and making sense of the everchanging digital world. It’s our job to understand the nuances of how and why different types of peopleuse technology and what that tells us about them. More importantly, it’s our job to help our clients apply this knowledge tobetter communicate with their customers. We help clients translate business goals into marketing campaigns that buildrelationships with customers. In the 21st century, understanding how and why someone uses technology is as important asunderstanding where they live, what gender they are, and how old they are.That’s where we come in. From ensuring that technological behavior is considered in the research phase, to tacticalplans that align digital, print and broadcast tactics, we work with clients and internal partners to make sure it allworks.It’s not about what’s cool. It’s about what works. RTCRM Proprietary Pg. 4