Should Apple be nervous following Amazon introducing the Kindle Fire HD Thursday? No, says Wall Street. However, Google and Microsoft could be sweating bullets, analysts are telling investors Friday.

Apple still rules the tablet world,” writes Brian White of Topeka Capital Markets. Indeed, the expected release of a 7.85-inch ‘iPad mini‘ will expand the the company’s customer base, “potentially even surpassing sales of the regular-sized iPad.” In short, Apple investors should relax…

Although crediting the new 8.9-inch and 7-inch Kindle Fire HD as “ambitious,” Sterne Agee analyst Shaw Wu said Amazon’s new entry could actually help Apple by limiting some competitors, such as Samsung and Research in Motion to minor annoyances. As for Apple’s major threats — Google’s Nexus 7 and Microsoft’s Surface — the $199 Amazon device could increase competition while shrinking profit margins.

Although the $199 Google Nexus has experienced strong demand since being introduced in July, the tablet “could see competitive pressure” from the 7-inch Kindle Fire HD. Although both products are priced the same, Amazon has doubled the Kindle Fire’s storage to 16GB from 8GB, Wu said.

As for Microsoft, the introduction of the Kindle Fire HD will force the company to drop the Surface price from $299. But this race to the bottom rarely pays off, warned Wu. Not even Apple has been able to profit much from just selling content via its App Store.

Reselling content has historically proven to not be a very profitable venture,” he notes.

Apple is expected to announce the ‘iPad mini’ in October with a $250-$300 price.

What do you think? Will Amazon’s new Kindle Fire HD eat into demand for the iPad (either the full-size or upcoming mini)?

  • jose castro

    kindle fire a good device but im not impressed…

  • I would like to think that the kindle fire could compete with the iPad but it just can’t

  • CollegiateLad

    I think ads on the lock and home screen of the Kindle Fire HD are a bad idea… I guess that’s the only way to subsidize it. I know I personally hate ads. If I download a free app with ads, I delete it.

    • jose castro

      its not that bad for people who cant afford a ipads…

      • oh god, here we go with this elitest crap.
        Well Biff, I prefer the iPad because it’s not made for poor people! ugh!

        Sorry, but I wouldn’t spend $500 to get my kid an iPad for Christmas. $200 is more reasonable, but for a 7 year old who still knocks her drink over at least once a week, I’m not buying her an iPad. She’s been asking for a Kindle Fire, but I think I would go with a Nexus 7.

        It has nothing to do with CAN’T AFFORD bullshit and everything to do with common sense. And besides, I know it may be a foreign concept to you, but not everyone likes Apple or the iPad. I just sold my iPad and picked up a Galaxy Note Tablet and I love it. There’s a few things I miss that were on the iPad, but over all, I really love a lot of things that Android can do that iOS cannot. I love widgets. Our 12 year old loves S Note with Formulas for her 7th grade math. I asked her last night if she was to get a tablet, would she want an iPad or something like the Galaxy Note Tablet. She told me that a month ago it would have been an iPad, but now she would want a Galaxy Note Tablet instead. She’s grown up in a Mac only household until recently… lives with her iPod Touch attached to her at all times, but now likes the Android tablet over the iPad.

  • SimonReidy

    It’s actually a very powerful device as far as Android goes, but of course it’s for people that want to save money, don’t mind ads or are invested in Amazon’s ecosystem. One of its biggest strength is t’s got a great high res widescreen for watching movies from Amazon Prime and a very capable gaming chipset.

    Given we don’t even have access to most of Amazon’s content in Australia (and its the same for many other countries) the iPad will remain the dominant force regardless. As for the the rest of the world If anyone it’s Microsoft Apple will be competing with in the tablet space (and Android far more so with phones).