Skip to main content

IHS: Amazon Kindle Fire costs $201.70 to make

amazon-kindle-fireIndustry analysis firm IHS iSuppli has completed its preliminary teardown report on the Amazon Kindle Fire tablet, and finds a total bill of materials (BOM) for the device sums up to $186.50. When coupled with manufacturing expenses, Amazon’s total cost for a Fire tablet is $201.70—some $2.70 more than the $199 Amazon is charging for the device.

“The Kindle Fire, at a retail price point of $199, is sold at a loss by Amazon, just as the basic Kindle is also sold at a loss at the current $79 retail price point,” said IHS senior director of teardown services Andrew Rassweiler, in a statement.

Recommended Videos

Amazon has repeatedly indicated that it hopes to make a small profit on hardware sales of devices further down the road, but the company’s goal is really to foster an ecosystem where users buy content for their devices, whether that be movies, television shows, apps, or (of course) ebooks. Due to expected revenue from content sales, Amazon is willing to sell the devices at a bit of a loss, and (going forward) at lower margins than typical device manufacturers.

The teardown cost analysis of the Kindle Fire highlights the contrasting business approaches of Amazon and Apple in the tablet market to date. Although Apple earns some money from the sales of apps, music, movies, books, and other content through iTunes, those figures have always been tiny compared to the money the company earns through hardware sales: despite everything, Apple remains first and foremost a hardware company. Amazon, conversely, is in the business of selling content, and its Kindle ereaders (and now Kindle Fire tablet) are offered essentially as portals into Amazon’s content ecosystem—where the company hopes to earn its money.

It’s important to note that while IHS’s estimate of the cost of the Kindle includes manufacturing costs and estimated prices of individual components, it does not represent the substantial investment in research and development that Amazon had to put into the Kindle Fire to make it a reality. In the Fire’s case, that’s much more than slapping Android into a device and pushing it out the door: it involves a whole new interface for the Fire device, as well as Amazon’s own cloud-assisted Web browser, Silk.

Geoff Duncan
Former Contributor
Geoff Duncan writes, programs, edits, plays music, and delights in making software misbehave. He's probably the only member…
The Kindle Scribe just got a rare deal in Amazon’s Big Spring Sale
Handwritten notes using different pens on a Kindle Scribe.

There's a lot to say about the differences between paper books and ePaper books. Paper books give us extra senses of touch and book-depth to increase memory, and (I think) even Digital Trends writers are allowed to say that the time away from a screen is pretty great. But what if there was a paper-saving, super notetaking, and even discounted eBook that was debatably better than a regular physical book? Well, then we'd have to talk about it.

The latest Amazon Kindle Scribe is one of the best eReaders for notetakers, and you can get one with 64GB of storage for just $365 (or 20% less with a trade-in) right now. This Amazon Big Spring deal brings it down $85 from $450, at least if you buy it between now and March 31. Tap the button below to find the product or keep reading to learn about its cool features.

Read more
Amazon just slashed the price of the Kindle Colorsoft to only $225
A page from a comic on the Amazon Kindle Colorsoft Signature Edition.

If you've always wanted to buy an e-reader, you should check out Amazon's Big Spring Sale 2025 for Kindle deals. Here's an offer that's going to be hard to refuse: The Amazon Kindle Colorsoft Signature Edition, which has an original price of $280, is available at 20% off for a more affordable price of $225. We're surprised to see the device receive a $55 discount so soon after its launch late last year, so we highly recommend hurrying with your purchase because we don't expect this bargain to last until the event ends on March 31.

Buy Now

Read more
You can get an Amazon Fire tablet for $95 today, but there’s a catch
The 2023 model of the Amazon Fire HD 10 tablet on a white background.

In case you weren't aware, Amazon's Big Spring Sale deals just landed. The event, which lasts through March 31, isn't as popular or as advertised as Prime Day, but we're finding great tech deals nonetheless. One such deal is on the Amazon Fire HD 10 tablet. It's usually $140, but you can now get it for just $95. That's a $45 discount available for you as long as you purchase the tablet before the end of the month. And, with a trade-in, you can get an extra 20% off of the price. Tap the button below to pick up one of the most affordable tablet deals we've found in the sale or keep reading to see if the tablet meets your expectations (and learn about the "catch" for this great deal).

BUY NOW

Read more