Analyst says Amazon would sell five million Kindles and would fend off iPad

5th October, 2010 by adina
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Douglas Anmuth, analyst at Barclays Capital, estimates that Amazon will sell about five million Kindle readers during this year. The combination of the redesigned device and its lower price, at $139, should be an advantage for the company. Over the next two years, sales are expected to reach 11.5 million devices in 2012.

Anmuth expects the price gap to maintain Amazon safe from being affected by the iPad. According to him, the new Kindle creates a bifurcated market with cheap and narrow purpose e-readers occupying the high-end multi-purpose environment. Amazon would enjoy the benefits through Apple, as the Kindle application is still a very popular title on the iPad, so that it brings revenue even when someone acquires the competing tablet. The company may handle about 43 percent of the content on tablets, which include, besides Apple’s, the BlackBerry PlayBook of Research in Motion.

The analyst however warned that verifying Amazon’s sales figures in the near future could be a difficult task. Amazon would not be legally forced to disclose either Kindle revenue further details until accounting at least ten percent of its total business. the current estimate refers to a maximum of $1.7 billion this year, which means five percent. Jeff Bezos, the company’s CEO, outlined that his company keeps secret its sales figures in order to have a competitive advantage, but the general impression is that the company only tried to mask too slow sales until prices were cut.

T seems Apple would have no difficulty in beating Amazon in spite of the higher price. Another analyst, Gene Munster from Piper Jaffray, predicted the iPad would sell at least two times more than the Kindle and would reach in 2010 10.7 million and 21 million in 2011.


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