Amazon may knock $50 off the Kindle Fire price tag in order to make room for the Kindle Fire HD.
The latest Kindle Fire rumor is that Amazon may drop its price down from $199 USD to $149 USD. This will likely happen in 3Q12 as the company releases its revamped Kindle line and the Kindle Fire HD (2) tablet.
To expand its tablet market share, Amazon is reportedly looking to follow Apple's lead and release a new tablet while keeping the older model on the market with a reduced price. That said, sources from the upstream supply chain echo previous reports that Amazon will launch its Kindle Fire HD at the $199 for the "high-end" segment, and re-release the original Kindle Fire with several modifications with a $50 price reduction.
According to the sources, the 7-inch Kindle Fire HD will sport a screen resolution of 1280 x 800 whereas the original Kindle Fire will continue to burn at 1024 by 600. Amazon has reportedly halted the development of its rumored 8.9-inch model, but reportedly still plans to unleash a 10.1-inch version by the end of the year, or in 1Q13.
Amazon may be pushing to get its Kindle Fire HD out to consumers ASAP. Google is reportedly gearing up to introduce a 7-inch Nexus tablet -- manufactured by Asus -- next week during the Google I/O conference. It will supposedly sport Android 4.1 "Ice Cream Sandwich" and Nvidia's quad-core Tegra 3 SoC.
There are also rumors that Apple will release its own 7-inch iPad Mini sometime in 3Q12, and Microsoft is expected to announce its own 7-inch Kindle Fire rival at a special press conference on Monday. If anything, the 7-inch tablet market is about to heat up, sparked by the launch of Amazon's original Kindle Fire last year.
As sources point out, the number of Kindle Fire units sold has dropped significantly over the last several months. The company was able to achieve sales of up to 5.5 million units by the end of 2011, but the numbers took a nose dive in 1Q12, reaching up to only 800,000 units sold -- a mere 4-percent market share. Samsung's 2nd-generation Galaxy Tab line took Amazon's place with a 16.8-percent market share.
The drop in Kindle Fire sales is mainly blamed on Amazon's North American focus. Will the be the same case with the Kindle Fire HD? We'll have to wait and see when the tablet(s) launch later this year, but lowering the original Kindle Fire's pricetag in the meantime should get more units moving off retail shelves.