This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Bezos: Kindle, Paperwhite Make No Profit

NEW YORK ( TheStreet) - Every time Amazon (AMZN - Get Report) announces a new Kindle tablet or e-book reader there are experts who believe the company is selling those hardware products as a loss-leader to get customers to buy lots of books, music and apps to fill up device memory. Today, Amazon's boss put half of that rumor to rest.

Amazon CEO Jeff Bezos, in an interview with the BBC, said his company's Kindle Fire and Paperwhite book reader make no profit. But, he insists that they do break even.

Bezos was interviewed at the launch of the company's new e-Ink-powered Paperwhite reader in the U.K., France and Germany.

The Amazon supremo believes his company's subscription services are the big difference. Especially the Kindle Lending Library. That's where you can borrow (up to) one book a month from a group of specially-selected titles. The Paperwhite's biggest competition comes from the similar Barnes & Noble (BKS - Get Report) Nook Glowlight and the Kobo Glo.

He told the BBC: "We want to make money when people use our devices not when people buy our devices." That's the polar opposite of how Apple (AAPL - Get Report) markets its goods and services. The Cupertino, Calif.-based firm has indicated that much of its profits come from hardware sales while its iTunes store operates at "slightly above break even." Manufacturers making devices that run on Google's (GOOG - Get Report) Android OS depend on hardware profits as well.

Bezos boasted that Kindle fans also read more books of all kinds. He told the BBC that Kindle owners read four times as many books - electronic and paper editions - as non-Kindle owners.

European deliveries of Amazon's new Paperwhite e-reader begin in two weeks.

--Written by Gary Krakow in New York.

>To submit a news tip, send an email to:
Gary Krakow is TheStreet's senior technology correspondent.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $93.75 -1.10%
AMZN $659.75 9.60%
BKS $11.75 -1.90%
GOOG $693.00 0.29%
FB $117.53 0.69%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.49 -10.32 -0.50%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs