Did Amazon Create a Niche for the Kindle Fire?

Earlier this week, Apple Inc. (NASDAQ:AAPL) reported another impressive quarter, selling a whopping 12 million iPads. In the launch weekend alone, Apple sold 3 million units of its third generation iPad model. While Apple clearly dominates the tablet space, Amazon.Com Inc. (NASDAQ:AMZN) has created a niche of its own for the Kindle Fire.

According to a new report by comScore (NASDAQ:SCOR), a global leader in measuring the digital world, the Kindle Fire has almost doubled its share of the Android tablet market over the December to February time period. In a press release, the company explained, “The Kindle Fire, introduced to the market in November 2011, has seen rapid adoption among buyers of tablets. Within the Android tablet market, Kindle Fire has almost doubled its share in the past two months from 29.4 percent share in December 2011 to 54.4 percent share in February 2012, already establishing itself as the leading Android tablet by a wide margin.”

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The Samsung Galaxy Tab Family came in second place with an Android market share of 15.4 percent, while the Motorola Xoom ranked third with 7 percent market share. Other tablets such as Dell’s (NASDAQ:DELL) Streak and Sony’s (NYSE:SNE) Tablet S only held about a 1 percent Android market share each. Amazon’s strong presence in the Android market is not pleasant news to Google Inc. (NASDAQ:GOOG), which is rumored to launch its Nexus tablet later this year.

In addition to its Android niche, the Kindle Fire’s $199 price tag makes it more attainable for the lower-end consumer. While 50 percent of iPad owners came from households earning $100,000 or less, Kindle Fire owners coming from households earning the same represented 61 percent. Furthermore, despite the Kindle Fire’s screen size being 3 inches smaller than the iPad, the Kindle Fire is a hit with the ladies. According to comScore, women accounted for 47 percent of iPad owners, but accounted for almost 58 percent of Kindle Fire owners.

Late Thursday, Amazon shares surged more than 13 percent, as the company reported net earnings of 28 cents per share, well above estimates of 7 cents per share. The company said the Kindle Fire was the bestselling item on its website, shipping 4.7 million units in the fourth-quarter. Chief executive Jeff Bezos stressed on the company’s strategy to keep adding valuable content. “I’m excited to announce that we now have more than 130,000 new, in-copyright books that are exclusive to the Kindle Store – you won’t find them anywhere else,” Bezos said. “They include many of our top bestsellers – in fact, 16 of our top 100 bestselling titles are exclusive to our store.”

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