How Hot Is Kindle Fire?

Apple won't be the only brand watching Amazon's new Kindle tablet/reader, announced on Thursday with much fanfare by Amazon's CEO, Jeff Bezos. The Fire is a bit larger than other Kindles and smaller than the iPad, and it builds on Amazon's vast library of books and entertainment, plus depending on Amazon's cloud storage.

Analysts and industry insiders have been talking about the price--only $199--and how it poses a major challenge to Apple's iPad, which is priced starting at $499. But other rivals are in the mix, thanks to Amazon's aggressive pricing.

Lenovo's smallest IdeaPad, also 7" and also capable of streaming movies, is--at $199--a head-to-head competitor to the Kindle Fire.

With the holiday shopping season about to begin, this will be an intensive two-month competition for consumers' attention and wallets. Admittedly, the iPad has much to recommend it as a laptop alternative, not a primary e-reader, and its price reflects the many bells and whistles (cameras etc) that the Fire lacks. But I still expect Apple to make some kind of competitive move before the year is over. What will it do?

Oh, and did I mention that Netflix will be feeling the heat from Kindle as well? Amazon is offering unlimited access to some 11,000 TV shows and movies for Amazon Prime customers (cost: $79/yr), along with a 30-day trial for Kindle Fire buyers. Given Netflix's recent pricing stumbles, Amazon may have found the right downloading lever for prying Netflix customers away--and the right hardware for sealing the bargain.

Still, some privacy advocates are concerned about the way in which Kindle Fire will route Web browsing via its cloud, logging and retaining info about users' browsing for 30 days. Opt-out is possible, apparently, but this aspect of the Amazon Silk browser isn't winning applause in many circles.