According to analyst Tim Bajarin, Amazon's mysterious upcoming tablet will likely sell for under cost, but still be wildly profitable over its lifespan.
Bajarian says talks with component makers have the Amazon tablet with an estimated cost of $300. The e-tailer will then likely sell the tablet for just $250, undercutting all other tablets on the market and selling under cost.
Despite taking a $50 loss per unit on the initial sale, Amazon will make up the difference in videos, songs, cloud storage and books sold, with Bajarian saying the company will "reap a profit of anywhere from 10 to 30 percent on the tablet over the last 18 months of the device's accounting period."
The analyst goes further and says, "when measuring by units shipped, this method could make Amazon the king of Android tablets very quickly. In fact, I would go as far as to say that it could 'own' the Android tablet market."
If rumors prove true, Amazon will release a dual-core 7-inch tablet and a quad-core 10-inch tablet sometime later this year.
Despite taking a $50 loss per unit on the initial sale, Amazon will make up the difference in videos, songs, cloud storage and books sold, with Bajarian saying the company will "reap a profit of anywhere from 10 to 30 percent on the tablet over the last 18 months of the device's accounting period."
The analyst goes further and says, "when measuring by units shipped, this method could make Amazon the king of Android tablets very quickly. In fact, I would go as far as to say that it could 'own' the Android tablet market."
If rumors prove true, Amazon will release a dual-core 7-inch tablet and a quad-core 10-inch tablet sometime later this year.
