“We sell the hardware at cost,” Bezos told the BBC in an interview published Thursday. “We want to make money when people use our devices, not when they buy them.”
The statement from Bezos confirms a long-held assumption that Amazon breaks even — rather than profits — on sales of its hardware. In fact, previous estimates have suggested that Amazon might even sell some of its Kindle products at a slight loss.
For Amazon, the Kindle is seen as more of a gateway to the many products sold by the website, including e-books, movies and apps. Indeed, Bezos has said repeatedly over the years that Amazon’s business model is to survive on slim profits.
That’s a much different business strategy than some of Amazon’s competitors in the mobile market, particularly Apple, which has built up a huge cash pile through the profit margins on its mobile products. However, even Apple may be moving a little closer to Amazon’s direction if it does indeed release an iPad Mini this month for $299 or less.
Original article here....http://wtr.mn/OtDLyL
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