Amazon's Kindle Fire rocketed to success during the last holiday shopping season, its $199 price tag serving as a great alternative to the iPad's $500 one. Since then, however, sales have softened considerably, and they may take a further blow if Google releases its own 7-inch Nexus tablet later this month as expected.
So what's Amazon to do? Well, do what Amazon does best. According to rumormonger extraordinaire DigiTimes, the company is planning to slash the price of the Fire by 25 percent when it delivers its next generation of tablets later this year. In other words, you'll be able to buy the 7-inch Kindle Fire for a mere $149.
DigiTimes claims Amazon will be able to do that, in part, because it will be introducing a new 7-inch slate along with a long-rumored 10.1-inch model. The new 7-inch tablet would boost screen resolution to 1,280x800 and retain the Kindle Fire's original $199 price.
The strategy is straight out of Apple's playbook: dropping the price of the previous generation's hardware in order to expand its market share. It worked with the iPod and iPhone, and Apple's already doing it with the iPad, continuing to sell the iPad 2 for $399. The move could also help blunt whatever momentum Google could achieve with the Nexus tablet.
Would you be more likely to buy a Kindle Fire if it were $50 cheaper? Why or why not? Let us know in the Comments section below.