Competition is good: Bring back the iRex

kindle fire with magazine coversThis post is for those among the 12 people who read this blog who heard about the new Kindle Fire* by reading it in your local daily newspaper and who are likely seeing this about a week after it was written, probably buried somewhere on my LinkedIn account.

Those who have read every tweet and post and comment from Apple-lovers, -haters, and members of the contentocracy, during the past 24 hours, go away. It’s just more noise.

[I will note for drive-by readers who may be delivered here by Google or Twitter, the Kindle and the iPad go way back on this blog.]

Having been a marketer longer than I’ve been an accidental observer of technology, I am constantly bemused by the complete lack of consideration (understanding?) technologists (the religious kind who still read TechCrunch, even after Arrington left) have when it comes to consumer product marketing. Even when those products are technology-powered and are delivered over the web, there is little about the product’s success that is actually about the technology.

Selling technology today is more like selling water. You see that water fountain over there — go take a drink for free. See that tap, same thing. See that water in a plastic bottle. It’s costs $3 because, well, that’s what people are willing to pay for the awesome story I dreamed up and spread with great skill and strategy, incredible luck and deep pockets (or better yet, all of the above). And, strangely, it does taste better.

But technologists love to argue over specifications and inside baseball issues that use terms like open and closed and something called privacy. They don’t get the story part. Even after watching Apple ads, they don’t get it.

I’ll let others duke it out over the specifications and privacy issues and hundreds of other threads of conversation spawned by the introduction of the Kindle Fire.

But here are some of “forget the technology” thoughts and preditions:

1. It’s great for consumers. I could cite dozens of reasons why, but they all boil down to variations of this cliché: competition is good.

2. Publishers have lusted over the false notion that the iPad is a “consumption” device rather than a device one creates something on. (The idea of consumption is like the idea of content. We don’t read books anymore, we consume content.)  Of course, iPad users and app developers immediately disproved the “it’s a consumption device, not a creation device” theory in thousands of ways. The Kindle Fire seems to be the iPad consumption device for which  publishers have lusted.

3. If you are going to use your touch-screen pad device for reading books and pdfs and blogs that, like mine, are evolving to designs that are “pad-first” formats, then the Kindle Fire is going to work just dandy for you.

4. If you have plans to replace your travel laptop with a pad device, get an iPad. Trust me. Better yet, buy a MacBook Air (about which I’ll blog another day).

5. Apple has two advantages over Amazon that you need to consider:

1. Apple creates the best mass-consumed electronic devices in the world. They could break the company in two and be first and second best creator of “mass” products.

2. Their advertising uses traditional mainstream media, network TV, urban outdoor and print, more effectively and efficiently than any marketer in history. And, because their advertising budget coffers over-flow, they can advertise (test me this Sunday) on NFL football on every quarter of every game played. (This is especially an advantage when it comes to using mass marketing against Amazon (or Google, for that matter) for a long list of reasons you’ll have to trust me on.)

6. Amazon has two advantages over Apple that you need to consider:

1. They are the greatest retail merchant in the history of the world that isn’t named Walmart. I personally have purchased more merchandise from Amazon in the past 15 years than from any other company, ever. And unlike those other companies, Amazon can provide me with a list of each thing I’ve purchased and how much I paid. And they can use that information to recommend products for me the buy. (Screw privacy.) I could go on and on.

2. Amazon understands the internet far, far more than Apple does. There are hundreds of ways I could provide evidence for this claim, but here’s a rather obscure one that, in a million years, Apple would have never considered. In 1998 (yes, the internet goes back that far), Amazon bought IMDB.com. It was one of the first acquisitions of an internet content “property” that I had heard of, at the time. Go look at the front of IMDB.com and notice all of those places where you don’t see the Amazon.com brand. (Ironically, you’ll see the Apple brand more prominently.) Now, go back and look at the front of IMDB.com. What you see is Amazon’s 15 year head start at creating the most incredible front end of a video streaming service one can imagine. And it’s a wiki — a user-generated store front. I love this stuff.

Longview predictions:

  • In three years, there will be more Kindle Fires in the marketplace of (the next phrase is critical) hand-held touch pad devices than iPads.
  • However, in three years, the profits generated from the sale of hand-held sized iPads (the hardware) will be in the 90%+ range favoring Apple.
  • Amazon will make boatloads of money from selling books and streaming movies, in a similarly dominant way over Apple.
  • Apple’s future touch screen “pad” devices will include form factors far different from the book-size device you see today. After a few weeks of being told why such new devices can change your life (talking with grandkids in 50″ HD, say), we’ll be wondering how we ever thought Apple and Amazon were in the same business.

*That’s an affiliate store link: Click on it and buy a Kindle Fire and I’ll be on my way to retailing success.

Follow me on Twitter: @R

  • Sam McDonald

    Great post! Probably the most concise and assute commentary I’ve read on the Kindle Fire so far.

    Also, had no idea that Amazon owned IMDB.com, that really is an amazing fact.

    As a European though, Amazon really are trying my patience by not making it available for purchase from amazon.de, amazon.fr etc. from day one….

  • You’ve just won the “commenter of the week” award. ;  )

  • Anonymous

    What is most telling here is that Apple is better at marketing than it is at making things; the iPhone is still fourth in sales among smartphones.  People will pay extra for the cachet of hipness and don’t mind instant obsolescence. Cool, sure. Over-rated, damn-sure.