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Kindle Fire First Real iPad Competitor?

At a press event in New York this morning, Amazon unveiled their new line of Kindle tablets.  Amazon's successful E-reader line with black and white screens has been expanded to five models; Kindle, Kindle Touch, Kindle Touch 3G, Kindle Keyboard, and Kindle Keyboard 3G priced from $79 to $139 with on-screen advertising.  Without the on-screen advertising the five models are priced from $109 to $189.

The big news, however, is Amazon's announcement of the new color Kindle Fire!  The Kindle Fire features a 7-inch 1024 x 600 pixel multi-touch IPS display, dual-core processor (speed not specified), 8GB of internal memory, Wi-Fi, up to 8 hours of battery life for reading and up to 7.5 hours of video playback with Wi-Fi turned off.

The new Kindle Fire isn't exactly a surprise.  Developers have had them in their hands for awhile now.  What is rather surprising is Amazon's selling price for the new color tablet: $199!  Analysts were expecting the Kindle Fire to be priced at $249.

The sub-$200 price seems to be a sweet spot for American consumers when it comes to tablets.  Remember the HP Touchpad?  Touchpad sales were extremely disappointing until HP dropped the price to $99 (16GB) and $149 (32GB).  Then retailers couldn't keep Touchpads on the shelves.  And that was for a dying product.  The Kindle Fire is brand new, with a promising future, and price under $200!.  I'm confident the new color Kindle will be a huge success for Amazon.

But is the Kindle Fire the first tablet that can truly challenge the iPad?  More to the point, will Amazon's new tablet steal sales from Apple's wildly successful iPad 2?  The iPad 2 has a larger screen, longer battery life, two built-in cameras, at least double the memory and 3G models available.  The iPad 2 also starts at more than twice the price of the Kindle Fire.

The next few months are going to be very interesting!