Kindle Fire Adds Fuel to Tablet Market Growth - eMarketer

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Kindle Fire Adds Fuel to Tablet Market Growth

Search interest for Kindle Fire already surpasses Barnes & Noble Nook

January 13, 2012

Thanks to strong holiday sales, a low price point and upward consumer interest in tablet devices, Amazon’s first tablet product, Kindle Fire, debuted with satisfactory results. According to global market research firm IHS iSuppli, in the last three months of 2011, Amazon sold 3.9 million Kindle Fire tablets, placing the brand in the second-place slot behind Apple in terms of tablet shipments.

Kindle Fire is contributing to the overall monumental growth of the tablet device marketplace. According iSuppli, tablet shipments reached nearly 65 million units in 2011. By 2015, the firm anticipates that number to skyrocket to 287 million units. The iPad’s unwavering growth is not to be discounted, of course. In Q4, Apple shipped 18.6 million devices, compared to Amazon’s aforementioned 3.9 million.

Tablet Shipments Worldwide, 2010, 2011 & 2015 (millions of units)

iSuppli’s number for Amazon’s 2011 shipments of Kindle Fire fell short of Barclays Capital’s January 2012 figures. Barclays estimated Amazon sold 5.5 million units of Kindle Fire in 2011. The investment bank predicted sales would skyrocket to 18.4 million in 2012. From there, the device will experience a steady growth curve.

Amazon Kindle Fire Tablet Sales, 2011-2014 (millions of units and % change)

Barclays also predicts content revenues for the Fire to enjoy a growth pattern similar to its sales. The investment bank places content revenues for the Fire currently at a meager $38.5 million. However, content revenues are expected to reach close to $1 billion in 2012.

Amazon Kindle Fire Tablet Content Revenues, 2011-2014 (millions and % change)

As Kindle Fire generates more recognition and sales, marketers are looking to monetize. Sheila Buckley, senior vice president of digital ad sales at The Weather Channel, told eMarketer, “The tablet is a mobile device, but it’s also a TV in your hand that has content. Right now, the tablet just needs to achieve scale. I think the Amazon Kindle Fire, with a $199 price tag, will be a big game changer.”

Data from Google Insights for Search appears to back up that prediction. The search data shows that in the six weeks following the November 14 release of Kindle Fire, Google search interest in “Kindle Fire” jumped 335%. In comparison, for the same time period, search engine interest in “Nook” jumped only 150%.

The tablet marketplace will undoubtedly continue its fiery growth path, especially as new competitors and competitive products join the landscape. Rumors point to Amazon launching an 8.9-inch version of Kindle Fire in Q2. Moreover, Google is expected to release a tablet of its own in the spring.

eMarketer estimates that by the end of 2012, 54.8 million Americans will have a tablet of some kind, up from 33.7 million at the end of 2011. While the iPad will decline in share of the total from 83% in 2011 to 68% by 2014, it will continue to dominate the market for the foreseeable future.

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Check out today’s other article, “Balancing Paid, Owned and Earned Media a Must for Multichannel Marketers.”


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