Analysis says $79 Kindle costs $84 to make

November 11, 2011

A recent analysis from IHS iSuppli determined that Amazon's $79 Kindle e-reader, which is the online retailer's cheapest Kindle thus far, costs $84.25 to make.

In the report, said the total cost of materials for the Kindle is $78.59, including $30.50 for the e-reader's 6-inch E-ink display. The estimates manufacturing costs run $5.66 per device.

IHS iSuppli notes that these costs don't include any of Amazon.com Inc.'s development costs for the Kindle, or costs related to things such as shipping and distribution of the device.

Even if Amazon pays more to build the $79 Kindle than it sells it for, the company has several other ways to bring in money from the device. This Kindle model includes ads that show up as screensavers and at the bottom of the device's home screen. And Amazon sees all the devices in the Kindle family - and the free Kindle apps it offers for and computers - as a way to spur more sales of its digital e-books, music, games and apps.

Amazon has repeatedly lowered the price of the Kindle and added more devices to the Kindle lineup since it began selling the first one in late 2007 for $399. The $79 version, which the Seattle-based company started selling in late September, eschews the keyboard found on earlier Kindle models. Amazon will begin shipping touch-screen Kindles ($99 to $189) and its first , the Kindle Fire ($199), later this month. Amazon still offers a Kindle that includes a physical keyboard, too.

Amazon has not said how many Kindles it has sold.

Explore further: Amazon sells out of Kindle book reader

0 shares

Related Stories

Amazon planning iPad rival by October: WSJ

July 13, 2011

Online retail giant Amazon plans to unveil a tablet computer before October in a bid to carve out a slice of a growing market dominated by Apple's iPad, The Wall Street Journal reported Wednesday.

Recommended for you

Netherlands bank customers can get vocal on payments

August 1, 2015

Are some people fed up with remembering and using passwords and PINs to make it though the day? Those who have had enough would prefer to do without them. For mobile tasks that involve banking, though, it is obvious that ...

Power grid forecasting tool reduces costly errors

July 30, 2015

Accurately forecasting future electricity needs is tricky, with sudden weather changes and other variables impacting projections minute by minute. Errors can have grave repercussions, from blackouts to high market costs. ...

Microsoft describes hard-to-mimic authentication gesture

August 1, 2015

Photos. Messages. Bank account codes. And so much more—sit on a person's mobile device, and the question is, how to secure them without having to depend on lengthy password codes of letters and numbers. Vendors promoting ...

3 comments

Adjust slider to filter visible comments by rank

Display comments: newest first

Cynical1
not rated yet Nov 12, 2011
Reminds me of the inkjet model - cheap printer that us a LOT of expensive ink....
boznz
not rated yet Nov 12, 2011
@Cynical1 - Except kindle books are always a lower price than their paper equivalent.

Maybe once all paper books are out of print the price will go up but it seems an unlikely scenario, more likely real books will cost more once the economies of scale of lower print runs come into play.

Unless you really have to have paper books I don't see any real losers from the introduction of this technology
Fred_West
not rated yet Nov 14, 2011
They make a profit by selling it for a much higher price in other countries. The same product costs $140 in the UK.

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.