Analyst Boosts Q4 Amazon (AMZN) Fire Sales Expectations Following Checks

October 14, 2011 11:31 AM EDT
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Tablets continue to be a hot commodity for both consumers and companies.

Current market leader Apple (Nasdaq: AAPL) has it's iPad, iPad 2, and (soon), the iPad 3.

Amazon, as announced September 28th, is bringing a new media tablet to the market in the Kindle Fire.

One analyst from Rodman & Renshaw is getting more bullish on Amazon's prospects following initial checks. The analyst lifted his forecast 25 percent for initial fourth quarter Fire sales from 4 million to 5 million.

The analyst said Apple is currently shipping about 12 million tablets per quarter, and that estimate hasn't changed.

Estimates were increased as Amazon reported record pre-orders from day one. eDataSource provides initial sales of 215,000 within the first six days, indicating a monthly rate of 1.08 million. But with holiday sales looming, that number might ramp into the holidays.

The Rodman analyst also claimed its time for a competitor to challenge Apple in the tablet realm, but that might not be the right direction. At $199, the Fire isn't designed to be the end-all tablet. While the iPad can run word processors and other complicated tasks, the Fire is more media focused, for streaming things like movies and songs. With a 7-inch display, it pales compared with Apple's nearly 10-inch display. However, the analyst might be more focused on pure numbers; not one Google (Nasdaq: GOOG) Android-based tablet has been able to even come close to Apple's numbers.

But that might change. In August, Hewlett-Packard (NYSE: HPQ) cut the price on it's TouchPad to $99, spurring a frenzy of buying. The move indicates consumers are interested in a tablet device, but prices above $500 are just not going to fly.

That said, Amazon and Apple might occupy the tablet space in perfect harmony: Amazon for the Android crowd, and Apple for Applonians. Apple has been forecast to lose some market share moving forward as stronger competitors enter the market, but it will most likely retain the top-spot and majority share through at least 2015, according to some estimates.

The Rodman & Renshaw analyst cautioned that Amazon might miss his target mainly on the display side, which is Amazon's major constraining factor currently.

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consider this
joke on 2011-10-15 22:55:21
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Consider points below before buying Kindle Fire:
- Amazon confirmed that you cannot download anything to Kindle Fire when traveling outside US.
- Kindle Fire (or any other Kindle) doesn't have microSD (or any other) card slot thus it is stuck with 6 GB USABLE internal storage unlike other tablets/ereaders that can get up to 32 GB card in to increase content capacity. Kindles are made to be almost like a "dumb terminal" of the past to make sure you're tied up to Amazon's storage on the web (for which you need Wi-Fi connection to
get to) and you can only store content you get from Amazon there, not other files. Quoting Amazon on Kindle Fire: "Free cloud storage for all Amazon content". Get it, Amazon content?
- The stats of how long the battery can last (Kindle Fire theory is 7.5 hours) are taken with Wi-Fi off. It will last about 3 hours if you use it to access content from their Cloud storage over Wi-Fi.
- Amazon can spy on your web activity through their new cloud-integrated web browser of Kindle Fire.
- VERY IMPORTANT – lack of microSD slot means that if you decide to"root" your Kindle Fire (or any other Kindle) you’ll have to "root" the actual device thus there will be no coming back. On other devices you can make it boot from a “rooted” microSD card and if you want to get back to the
original Operating System you can just take out the card and reboot, and you can go back and forth between different images of various OS's.
- Kindle Fire doesn't have a camera.
- Kindle Fire has about 70% less usable screen area than iPad 2.
- Kindle doesn't support eBooks in ePub format that is the most used format in the world.
- Kindle app store contains only Amazon approved apps and it does not include (and will not include) Netflix app that other tablets/ereaders have thus again you're stuck with Amazon content only.
- Amazon says it will review every app in its Appstore for Fire compatibility, as part of an automated process. Rejected apps will include those that rely on a gyroscope, camera, WAN module, Bluetooth, microphone, GPS, or micro SD. Apps are also forbidden from using Google's Mobile Services (and in-app billing), which, if included, will have to be "gracefully" removed. In terms of actual content, Amazon has outlawed all apps that change the tablet's UI in any way (including theme- or wallpaper-based tools), as well as any that demand root access (it remains to be seen how the company will treat the root-dependent apps already in its store) - this is what "rooting" can help with.

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