Amazon Fires Barrage at Apple: Cheap Kindle, Touch Kindle, Tablet Kindle

Let's start with the bottom line: Amazon's announcements this morning were the most important in the gadget world since Apple announced the iPad on January 27, 2010. With the announcement of a $79 regular Kindle, $99 touch-enabled Kindle, and $199 Kindle Fire tablet, Amazon set itself up for a Christmas clash with Apple's iOS juggernaut. While many tablet contenders have come at Apple, few can throw as many punches as Amazon.

Amazon can hit Apple high with the Kindle Fire, which is the first non-Apple tablet that will offer as integrated a media service as Apple's ecosystem does. And it even comes with a hard-to-believe-but-awesome-if-it-works feature that Apple doesn't have: cloud-enhanced web browsing. The Fire will supposedly offer better mobile browsing because it offloads the computationally intensive bits off to Amazon's cloud computing service.

Amazon can hit Apple low with the $79 Kindle. Because so many gadgets are sold to price-insensitive early adopters, we all tend to underestimate the effect that a sub-$100 price has. The lower the price, the bigger the market. For tablet owners like myself, the new Kindle could be that cheaper device we carry on the subway or to the gym. For people who don't own an e-reading device, a device that is substantially below the $100 barrier may be just the move they need to make the switch to digital reading. HP couldn't move many Touchpads at $400, but at $99 they sold out so quickly that online retailers had to refund people's money because sales outstripped supply. For the mass-market, a double-digit purchase feels more accessible.

Amazon can also hit Apple on the weight of the iPad 2. The iPad weighs 21.6 ounces. The Kindle fire weighs 14.6 ounces. It doesn't seem like a lot, but when you're reading with one hand. those 7 ounces are big. Put it this way: the iPad is the weight of a sizeable hardcover book while the Kindle Fire is the weight of a paperback. Which do you like to carry around more?

Unlike other companies who are trying to knock off the iPad, Amazon seems to have a strategy here that plays to its strengths: readers, cloud computing, e-retailing, end-to-end media services. If nothing else, that should make Amazon a real competitor. You get the sense from the company that they are trying to do something rather than copycatting something that's worked. 

There could be some downsides to the new Kindle plan. By splitting its offerings for consumers, they may lose some of the branding focus they could have had with less products. Apple, in phones and tablets, has been successful with its laser-like focus on the iPhone and iPad. But then again, in music players, Apple's differentiated its players for years. The bigger problem may be that the Kindle Fire can't live up to the expectations that Amazon has created. Based on its specs, it's not all that different from the failed tablets that came before it. What if the implicit comparisons people make between it and the iPad make its capabilities seem lackluster?

No matter what, with the low prices on its gadgets, the company is sure to push millions more of its portable cash registers e-readers into consumers' hands in the coming months.

Your move, Apple.