Bringing advertisements to the Kindle line changed the way that eReaders were priced. The competition has only recently been able to begin matching Amazon’s listings. Interestingly, Amazon has also surprised customers by offering advertisements that occasionally bring genuine value to them beyond the initial price drop in hardware purchase. Integration with Amazon’s local advertising only serves to make this more effective, of course. The success that the Kindle w/ Special Offers as a program has enjoyed made it almost inevitable that the Kindle Fire would be included eventually and it seems that the time has come.
The Kindle Fire is Amazon’s best-selling product, as their first-quarter earnings release made clear. It shouldn’t take anybody by surprise, then, to find out that they intend to make sure advertising space on the device comes at a premium. According to Ad Age, that premium might be an even more expensive one than we could have predicted. Amazon is said to be looking for $600,000 to run an ad on the Kindle Fire’s Welcome Screen. For a variety of reasons, some of which are apparent, there has not been a great deal of enthusiasm for the idea among advertisers so far.
In addition to this being an impressively high charge for something like this, there was a great deal that was left unsaid. For one, nobody seems to be quite sure whether or not these ads would be served to the millions of Kindle Fire owners who have already bought their tablets. Having purchased a new product at full price with no indication that it would be used by Amazon to serve up advertisements, doing so would definitely upset some people and potentially undercut the benefits of buying the ad space. This isn’t exactly a situation where Amazon is incurring obvious costs on existing units, as the Kindle Fire lacks 3G access.
Also, the company seems to have failed to clearly define what they consider to be the “Welcome Screen”. Is this the Lock Screen, or something else? This could very well be a sign that Amazon is getting ready for the next Kindle Fire and the Welcome Screen is something that will be included specifically for the purpose of creating a space for ads. Unlike the Kindle eReaders, persistent advertisements would not be possible when the tablet is powered down which creates the need for a more creative solution to make the ads worth buying.
If subsidized by advertising, the next Kindle Fire model could be impressively inexpensive. Existing Kindle w/ Special Offers options are 30% cheaper than their counterparts. If the same sort of trend applies to the Kindle Fire, it could mean a $150 7″ Kindle Fire or better yet a $200 9.7″ option. Now they just need to clarify the details to attract some interest. It is probably a smart buy for many advertisers, but how can they be sure of that when so many things are left unsaid?