Amazon Kindle Fire HD 8.9-inch model price cut

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Amazon announced today that it was cutting the price on both versions of its largest Kindle device, the Kindle Fire HD 8.9. The WiFi only version of the tablet was priced at $299 in the U.S. and will see its price drop to $269. The price cut for the 4G enabled version is more dramatic, going from $499 down to $399. According to Amazon, they sell their Kindle devices at cost. With the impending release of the device to several new markets including the U.K., Germany, France, Italy, Spain and Japan, Amazon claims they have achieved some new economies of scale as they ramp up production to meet the expected demand from the new markets.


Amazon sells their devices at cost as part of a strategy to make their profit selling content for the devices, whether it is books, movies, magazines, games or other digital products. A small amount of profit is also made selling accessories for the devices. This strategy depends on Amazon selling a lot of units, something some analysts don’t think is happening. Chad Bartley with Pacific Crest Securities cites sources in the supply chain who have told him demand is weak. Others, like BGC Partners’ Colin Gillis, think the price drop is part of the normal sales cycle that slows down during the first part of the year.

If you have been eyeing a Kindle Fire HD 8.9, now may be the time to make your move.

source: Reuters


About the Author: Jeff Causey

Raised in North Carolina, Jeff Causey is a chief financial officer and licensed CPA in Durham, North Carolina. Jeff has owned an HTC EVO, a Samsung Note II, and a Samsung Galaxy Tablet 10.1. He currently uses an LG G3 and a Nexus 7 (2013). Recently Jeff added Google Glass to his stable of tech gadgets. Unfortunately, his wife and kids have all drunk the Apple Kool-Aid and have i-devices. Life at home often includes demonstrations of the superiority of his Android based devices. In his free time, Jeff is active in his church, a local MINI Cooper car club, and his daughter's soccer club. Jeff is married, has three kids, and a golden retriever.