It was not exactly a surprise. Google (NASDAQ:GOOG) presented its Nexus 7 tablet, aimed straight at Amazon.com's (NASDAQ:AMZN) Kindle Fire. Regardless of how it is presented, this tablet's objective is simple: To wipe the Kindle Fire from the market. It's highly doubtful, given the amazing specs, that the tablet is intended to produce any profits.
- Its OS is Android 4.1, the very latest. Kindle Fire runs on a forked Android 2.3 version -- technically obsolete by now;
- It has a much faster CPU and GPU, and uses the nVidia (NASDAQ:NVDA) quad-core Tegra 3 at 1.3 Ghz, versus the Texas Instruments (NYSE:TXN) dual-core OMAP 4430 at 1 Ghz for the Kindle Fire;
- It has a better display, with 1280x800 resolution backed by Tegra 3's 12 GPUs. Kindle Fire makes do with an unresponsive 1024x600 panel.
- It has 10 point multitouch capability, versus 2 point on the Kindle Fire;
- It's lighter (11.99 oz.), the Kindle Fire weighs in at 14.6 oz. This is significant when you have to hold it for long reading periods;
- It's thinner (0.41 inches), the Kindle Fire stands at 0.45 inches;
- It has a larger battery;
- It will be sold in more countries (Australia, Canada, the UK and the US to start);
- It has a front-facing camera and microphone, enabling the user to use VOIP apps. Kindle has neither;
- It has a full complement of sensors (accelerometer, magnetometer and a gyroscope). The Kindle Fire doesn't have them, ruling out any app that uses them;
- It has GPS. The Kindle Fire doesn't;
- It has access to Google Play and other important Google Apps such as Google Maps. The Kindle Fire doesn't, making its uses and available apps a small subset of the Android ecosystem;
- It has NFC and Bluetooth, the Kindle Fire doesn't.
All this for the same price ($199 for the 8 Gb version -- the same as Kindle Fire both for storage capacity and price, or $249 for the 16 Gb version). And this will include a $25 credit to spend on Google Play.
The Google Nexus tablet is simply in another division altogether, but still retails for the same price. It's a true kiss of death for the already ailing Kindle Fire. This kind of device can only be sold at the present price because Google is willing not to make any money on it, or maybe even lose money. It's highly unlikely that the Kindle Fire 2 will surpass these specs, especially because so many of them depend on access to the Google Android ecosystem.
Indeed, the Nexus tablet seems competitive enough to at least bring some grief to Apple's iPad 2 (priced at $399), since it's comparable in terms of specs and probably user experience. The decision there might rest on the customer, depending on whether they desire a larger or smaller form factor.
The Kindle Fire strategy, or what was left of it, is now officially dead. And as we know, the Kindle eReader strategy was also already ailing. As a result, Amazon.com is now basically shut out of the mobile revolution.
Disclosure: I am short AMZN.