Amazon CEO confirms Kindle hardware is sold at break-even

Posted on Friday, Oct 12 2012 @ 19:53 CEST by Thomas De Maesschalck
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Speaking to the BBC, Amazon CEO Jeff Bezos confirmed that the e-tailer is only seeking to hit break-even on its Kindle eReaders and tablets. The company's goal is to earn money with digital content, so the hardware is sold at cost, contrary to Apple, which has indicated in the past that it makes much of its profits from device sales while running iTunes at "slightly above" break-even.

Bezos also revealed in the interview that Kindle owners read four times as much as they did before they bought the Kindle, but they don't stop buying paper books either.
Mr Bezos made clear that the devices' success would depend on how many books and other media files were subsequently bought by their owners.

"We want to make money when people use our devices, not when people buy our devices," he told the BBC.

By contrast Apple has indicated in the past that it makes much of its profits from device sales while running its iTunes store "slightly above" break-even.


About the Author

Thomas De Maesschalck

Thomas has been messing with computer since early childhood and firmly believes the Internet is the best thing since sliced bread. Enjoys playing with new tech, is fascinated by science, and passionate about financial markets. When not behind a computer, he can be found with running shoes on or lifting heavy weights in the weight room.



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