Watch out, CIOs! The Kindle Fire may be coming to a cubicle near you.
Amazon unveiled its Kindle Fire tablet today, a Wi-Fi-only 7-inch tablet running Android and costing only $199. The price tag undercuts the popular iPad 2, which starts at $499. The Kindle Fire will also tap into Amazon's cloud services, e-books and massive credit card database.
Where other tablet makers have stumbled badly, the Amazon Kindle Fire is the most credible competitor to trip up Apple iPad's rapid rise in the consumer and enterprise markets.
The best thing going for the Kindle Fire is its price point. Consider the doomed Hewlett-Packard TouchPad, whose sluggish sales forced HP to pull the plug only a month after the TouchPad hit stores. In the fire sale that followed—HP dropped the price from $399 to $100—TouchPads practically flew off the shelves.
No doubt there's a market for cheap tablets.
The chances of Apple moving down market with a cheap iPad to compete with the Kindle Fire are slim to none. History shows that Apple is willing to give up the high-volume, low-margin market. (Most industry watchers have debunked the rumor that Apple will come out with a cheap iPhone during its "Let's Talk iPhone" event on October 4.)
Apple doesn't care about having the biggest market share, only the best products. When Apple comes out with, say, a new iPhone and dramatically cuts the price of the previous model, that's not playing in the entry-level market. Apple is just moving more inventory to make the newest iPhone the only option.
The low-end consumer door is wide open for the Kindle Fire. But what about the enterprise? In today's world of consumers bringing tech gadgets to work and wanting to hook them up to the network, CIOs should be concerned. For the most part, CIOs contained the troublesome Android OS to the smartphone. But an Android tablet spreading like wildfire in the enterprise presents a much bigger challenge.
"Anytime a new device with broad scale distribution hits the market, users are going to try to connect it to the enterprise," says Ojas Rege, vice president of product at MobileIron, which provides enterprise-class management and security for mobile devices. "The Kindle Fire is going to increase the pressure on IT to support Android even as it increases complexity."
Slideshow: First Look: Amazon Kindle Fire
Android has been plagued by the variations of the OS, giving CIOs and their IT departments headaches. Simply put, enterprise IT is unable to support all Android flavors. Android also is more susceptible to malware than iOS and BlackBerry platforms. Rege figures enterprise IT will initially refuse to allow Kindle Fire in the workplace.
But IT's "just say no" modus operandi can't last forever. "It can't hide its head in the sand," Rege says. "More and more Android devices are coming, and IT needs to be able to get out of a reactive cycle."
Rege advises CIOs to appoint an Android specialist who can make sense of the platform's variations and complexity. The specialist can create a framework for choosing which Android devices the company will support, which ones it won't, and then communicate the reasons to employees.
"The Kindle Fire is just the newest example of the breadth and variation among Android devices," Rege says. "It's also worth noting that Android is cornering the low-cost end of the smart device market, which means that user demand to support Android at work is only going to increase."