After thinking about it, here’s how I feel about the Amazon Fire. This just might be cool for what it is.

The much rumored Kindle update was announced today. There are four new models on the way. They are a wide variety of capablities, but Amazon has worked to keep the price point low. There is something for everyone. However, some questions have been raised by potential consumers already. analysts and pundits are already discussing which existing tablet will be unseated from its current position in the market as well.

First is the most cost effective at $79. No color, no touch, Wi-Fi only. This is Amazon’s attempt at ubiquity. At $79, they can put a Kindle in the hands of everyone that’s ever wanted one. The digital e-ink technology makes this a prime candidate to take over as the standard e-reader for everyone. It has a 6” screen with no keyboard so portability is this device’s biggest claim to fame.

Next up is the Kindle Touch, which comes in 2 flavors - Wi-Fi and 3G for $99 and $149 respectively. It is black and white e-ink on a 6” screen that supports multi-touch. The 3G is provided for free, but keep in mind that the experimental browser means much less data consumption, which is why Amazon can afford to provide it.

The big news of the day was the Kindle Fire ($199). This is their first entry into the color tablet market. It is run on the Android platform and sports a 7” LCD screen. First, a 7” screen is actually roughly 45% smaller than any 10” tablet (See HERE for explanation). Also, being LCD, it loses the e-ink technology which has been a winning point for the Kindle all along. This is no longer an Amazon e-reader. It’s merely another tablet in a long line of discount, smaller tablets. It is Wi-Fi only with 8gb of storage. There’s no camera anywhere on the device as well. It syncs wirelessly which Jeff Bezos used at a dig at Apple (even though iOS 5 which will be out in about a week, does the same thing). It is also running its own custom browser called Amazon Silk.

While this device runs on Android at its core, it has a custom UI layed on top, just like most Android devices. In reality, this is Amazon’s entrant into the tablet space. They Kindle has done well for so long for a couple of reasons. The first is the e-ink, which isn’t being abandoned just year, but Amazon no longer offers that exclusively with the LCD on the way. E-ink offers the ability to read in sunlight that no LCD screen does. The other major attraction is the simplicity of a single use device. Some people are just resistant to tablets. They want to read, in a cost effective manner that saves space on the shelf. This makes Amazon another player in a nearly saturated market (in its current iteration). 

The early adopters and Anti-Apple folks will jump all over it, but the fanfare will die down quickly and this will be not hold much sway in the space, just like all those before it. It all goes back to the fact that is just no real tablet market out there. There is an iPad and that’s it.

Good on Amazon for thinking outside the box and coming up with options at extremely affordable price points. However, I think they should have eliminated the Fire from their lineup and just stuck with what works best for them. Some people flocked to them just because the DIDN’T have a tablet and kept it simple.