Andre Yoskowitz
14 Oct 2012 12:51
During a recent interview, Amazon CEO Jeff Bezos admitted that the company does not make any money on its new Kindle Paperwhite or Kindle Fire HD hardware, selling the lineup at cost, give or take a few pennies.
The strategy is notably different from Apple, which sells each iPhone or iPad with a margin as high as 40 percent, making significant profit on every piece of hardware they sell.
Amazon does not have the same strategy instead choosing to get the devices into as many hands as possible so consumers can purchase more online content from Amazon's extensive ecosystem.
The company offers shopping, music, movies, apps, and books.
"What we find is that when people buy a Kindle they read four times as much as they did before they bought the Kindle," added Bezos. "But they don't stop buying paper books. Kindle owners read four times as much, but they continue to buy both types of books."