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\b ANCHOR LOGAN TITTLE \b0 \uc0\u8232 \u8232 Amazon reported this
week it had \'93sold out\'94 of its Kindle Fire tablet. There\'92s probably a reason
for that.\u8232 \u8232 {\field{\*\fldinst{HYPERLINK "http://news.cnet.com/8301-1035_3-57504515-94/kindle-fire-wont-go-big-to-take-on-ipad/"}}{\fldrslt
\cf3 \ul \ulc3 CNET has learned}} the company intends to release two seven-inch tablets
next week: a brand new Kindle Fire and a slightly updated version of the existing one. Instead
of increasing screen size to compete with the likes of Apple\'92s iPad, Amazon appears
to be reinforcing its position in the midsize tablet market.\uc0\u8232 \u8232 And Amazon
could take things a step further. Citing those involved with the tablets, {\field{\*\fldinst{HYPERLINK
"http://online.wsj.com/article_email/SB10000872396390444914904577623690307576820-lMyQjAxMTAyMDMwMTAzODE3Wj.html"}}{\fldrslt \cf3 \ul \ulc3 The Wall Street Journal reports}}
one tablet would be ad-supported and less expensive than Amazon\'92s other offerings
or those of the competition.\uc0\u8232 \u8232 A writer for Forbes points out the ad-supported
model {\field{\*\fldinst{HYPERLINK "http://www.forbes.com/sites/roberthof/2012/08/31/amazons-ad-supported-tablet-what-took-so-long/"}}{\fldrslt \cf3 \ul \ulc3 has worked for Amazon in the
past}}. It offered ad-supported Kindles for a price break of as much as $50, and it was
the only major tablet player to subsidize its devices that way.\uc0\u8232 \u8232
\b \'93But given that the three key tablet combatants today\'96Apple, Google, and Amazon\'96each
are already in the ad business to varying degrees, and as it becomes clearer what kinds
of ads work best on mobile devices, I wouldn\'92t be surprised to see more ad-supported models
before long.\'94 \b0 \uc0\u8232 \u8232 And Ars Technica says
that would {\field{\*\fldinst{HYPERLINK "http://arstechnica.com/gadgets/2012/08/advertisements-may-lead-to-a-cheaper-kindle-fire/"}}{\fldrslt \cf3 \ul \ulc3 give Amazon a leg up in the
crowded market}}. Google\'92s Nexus 7 tablet, for example, is a more capable machine for
the same price as the original Kindle Fire.\uc0\u8232 \u8232
\b \'93The option to subsidize some of the tablet's cost with advertisements could help
Amazon undercut Google without having to take a significant loss on each tablet sold.\'94
\b0 \uc0\u8232 \u8232 {\field{\*\fldinst{HYPERLINK "http://venturebeat.com/2012/08/31/two-kindle-fires-ads/"}}{\fldrslt
\cf3 \ul \ulc3 VentureBeat speculates}} \'97 if discounts got steep enough, users might
look past Kindle\'92s hardware shortcomings simply because it\'92s so cheap.\
\uc0\u8232 \b "This is all speculation, to be clear,
but think of what Amazon could accomplish with a $100 tablet. Fewer Android manufacturers
would be able to compete without losing money, and Apple certainly wouldn\'92t be able to
compete. And even though the original Kindle Fire\'92s hardware wasn\'92t very good, a
slight RAM upgrade and software improvements could still make it a steal at $100.
\b0 "\uc0\u8232 \u8232 And the speculation will continue, at least for the week. Amazon
has issued invitations for a September 6 press event.\
}