Anyone seen the Anandtech Fire review?

[roustabout]

http://www.anandtech.com/show/5128/amazon-kindle-fire-review

Pretty amazing.  This is a tech site, and they choose to compare the Fire to everything possible except for the Nook Tablet. 

Given that the review was posted Nov 29, I'm trying to figure out how they came to this decision - they don't even mention that the NT is available for sale.  Not a freaking peep. 

They consider it in contention against the pad 2, the Playbook and the g-tab 9. 

Kind of remarkable. 

[Nom-de-Nook]

I guess I wouldn't expect that from a tech site.  But I do expect it from others like the LA Times (who by the way still favors the iPad over the Fire).  Maybe because it was supposed to be the next "iPad Killer", maybe because it comes closer than any other tab of having all the media the iPad has (whereas the NT still has a way to go) or maybe because that site isn't going to take the NT seriously until it has more apps?

Or maybe it is just plain ignorance.  I would think you would compare to something in its price classification.  Of course, what I really would like is to see someone do a side by side of the NC and the Fire since they are the same price.

[keithlm]

The reviewers on Anandtech are known to trust their own opinions more than facts that don't agree with what they want as their conclusion.

But then I expect to see a lot of people make the assumption that Amazon Fire is a "contender" and that the Nook is just "obscure competition".

BTW: When I mention that I just bought a new Nook Tablet I have had many ask: "Didn't Barnes & Noble go out of business?" A lot of people believe that it was B&N that went out of business instead of Borders.

[Nom-de-Nook]

Ouch, that would definitely dampen anyone's enthusiasm for a device.  But I guess I don't see much if any advertizing locally for BN so I can see how someone could think that.  Even Amazon took out a print circular this weekend

[flyingtoastr Scribe]

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keithlm wrote:

BTW: When I mention that I just bought a new Nook Tablet I have had many ask: "Didn't Barnes & Noble go out of business?" A lot of people believe that it was B&N that went out of business instead of Borders.

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I still get people who walk into our (very busy) store and say "I thought you guys went bankrupt", to which I facepalm.

[roustabout]

Given that this piece carries Anand's byline - it's not just on his site, he's first author - and that they clearly waited a few days while looking pretty hard at the fire, I was very disappointed by this piece.  

[karmamule]

I agree. It's odd that much care and attention went into the review, but so little attention was paid to a larger context. It strikes me as a great example of "not seeing the forest for the trees."

[doncr]

From one of the authors of the review (Vivek Gowri):

We'll have a Nook Tablet review that touches on the comparisons to the Kindle Fire relatively soon

[deemure]

I don't believe reviews anymore.  First of all, most of them are subjective and second of all, too many of them either subtly or not so subtly ignore or downplay any company that does not advertise with them or won't have the potential to do so in the future.  And it's much "sexier" to position any device against an iPad.  The word iPad gets readers instantly and easily.

I don't see those other tablets (other than the iPad) having an existing ecosystem specifically geared toward them, so the idea that it's the lack of an iPad-like one for the NT that kept it out of the review is ridiculous. 

This is a tech review site.  The "headline" says it will be an iPad comparison and then in the first paragraph says it's rather stupid to compare them.  Ok, shut up then. 

The writers say the Fire has a different purpose than taking marketshare from Apple, which means it wasn't meant to compete with it.  Ok, this is stupid as well.  While I don't think the Amazon ecosystem is as polished or finished or as well thought out as the iTunes serving platter, I do think Amazon was going for a 2 or even 3-fold attack.  One was most definitely against its nearest rival, B&N-which any dolt would have included in the discussion especially if they dis-counted the iPad as a rival.  But, the other opponents are certainly the iPad due to the expansion and offering of streaming content, and even other Android (and alternate OS) tablets.  The ecosystem is as much aimed at Apple as it is other tabs without a proprietary one which can give people real reasons to buy a tablet.

I have no doubt that Amazon did direct the Fire primarily at B&N and created the ecosystem with the cloud and streaming to poke at Apple.

The writers discuss the Fire's form factor and can't rave about it-ok, the NT's form factor is fantastic-comfortable to hold without a cover.

And for anyone that thinks it's important that devices meet a certain pricepoint (no matter what devices cost to manufacture) may be unhappy with what they get.  You want cheaper so what you will get is cheap crap.  The Fire can be cheaper because of the internals it lacks and its case which is basically a carbon copy of others even if it's a different size.  I've asked this question before-B&N makes very little if anything on the NT, people don't want to pay much for ebooks, they want discounts on accessories and everything else, they want free, want more content developed, and so on.  Just where is a company like B&N supposed to get their profits from? 

Amazon subsidizes their products with all the other services and products they offer.  Some of their services are actually very expensive.  And every time someone purchases anything from them, part of the purchase price goes toward making Kindle Fires and supporting the also subsidized ecosystem.  B&N can't do that with the NT and most companies will not do that, preferring instead that you pay for what you are buying.  Even devices that are subsidized by paying for data plans are charging you for your device.

[roustabout]

"We'll have a Nook Tablet review that touches on the comparisons to the Kindle Fire relatively soon"

And that's cute, but it means the Fire review, if left unrevised, will essentially never consider the Tablet to be a competitive device, or even one worth mentioning in the same breath. 

[doncr]

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deemure wrote:

...

 I've asked this question before-B&N makes very little if anything on the NT, people don't want to pay much for ebooks, they want discounts on accessories and everything else, they want free, want more content developed, and so on.  Just where is a company like B&N supposed to get their profits from? 

...

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That's not that difficult of a question to answer.  You cut expenses and make it up with volume.  Digital delivery of content costs pretty much the same whether you're selling one thousand copies or one million.  Not so with retail stores and DTBs.  

The recording industry went through this same paradigm shift with digital music delivery.  How many record stores do you find in the shopping malls today?  Heck, how many can you find anywhere?  The same thing will happen with bookstores as the younger "digital" generation has grown up to expect Faster! Cheaper! Now! content delivery and they have also shown to trade their privacy (valuable marketing info) in order to get something free or at a reduced cost.  Like it or not, this bunch is where the future profits will come.

[deemure]

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doncr wrote:

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deemure wrote:

...

 I've asked this question before-B&N makes very little if anything on the NT, people don't want to pay much for ebooks, they want discounts on accessories and everything else, they want free, want more content developed, and so on.  Just where is a company like B&N supposed to get their profits from? 

...

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That's not that difficult of a question to answer.  You cut expenses and make it up with volume.  Digital delivery of content costs pretty much the same whether you're selling one thousand copies or one million.  Not so with retail stores and DTBs.  

The recording industry went through this same paradigm shift with digital music delivery.  How many record stores do you find in the shopping malls today?  Heck, how many can you find anywhere?  The same thing will happen with bookstores as the younger "digital" generation has grown up to expect Faster! Cheaper! Now! content delivery and they have also shown to trade their privacy (valuable marketing info) in order to get something free or at a reduced cost.  Like it or not, this bunch is where the future profits will come.

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If you already make diddly on an item, you could sell millions of them and not make a profit.  One million times diddly is still diddly.  Books and ebooks on their own still do not make enough money to cover the R&D, tech support, overhead, and so on.  And that assumes people are willing to pay for them.  If a company then uses other products they sell to subsidize things like ereaders, well a million times that equals a lot of loss.

Cutting expenses is what I was talking about-often it's done by cheapening a product or by laying people off.  And what you are suggesting is to me not a great suggestion.  It's exactly why Amazon can do what it does, which basically earns them a lot of money, but employs few people in this country.

And to your point that that's where we're headed, that is just plain sad.  As it is Amazon I think is at a tipping point.  They are more and more acting as a drop shipper, relying on the marketplace a lot (and believe me some of those in it are not so great), and their CS of late has been horrible.  I also think that one big shoe is going to drop on all those Fire users once the limited time offers are up and they have to pay for things. 

[Omnigeek]

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doncr wrote:

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deemure wrote:

...

 I've asked this question before-B&N makes very little if anything on the NT, people don't want to pay much for ebooks, they want discounts on accessories and everything else, they want free, want more content developed, and so on.  Just where is a company like B&N supposed to get their profits from? 

...

---

That's not that difficult of a question to answer.  You cut expenses and make it up with volume.  Digital delivery of content costs pretty much the same whether you're selling one thousand copies or one million.  Not so with retail stores and DTBs.  

The recording industry went through this same paradigm shift with digital music delivery.  How many record stores do you find in the shopping malls today?  Heck, how many can you find anywhere?  The same thing will happen with bookstores as the younger "digital" generation has grown up to expect Faster! Cheaper! Now! content delivery and they have also shown to trade their privacy (valuable marketing info) in order to get something free or at a reduced cost.  Like it or not, this bunch is where the future profits will come.

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Tech experts estimate Amazon is selling Fire for $5-20 below cost of manufacture.  Volume against a loss leader just increases the red ink that must be made up for by other products.  Unlike Congress or the President, B&N actually has to make things work on its balance sheet.  Also unlike the federal government, B&N didn't increase its deficit spending by 30+% two years ago so doesn't have as much wiggle room to reduce costs by cutting expenses.

[doncr]

It's not the purpose of a business to employ people - they are there to turn a profit and grow the business to increase share price for investors.  Employees are a means to an end, just as a retail store location is, or a rack of servers.  I don't know why people have such a hard time understanding this.

If you're making no profit on your current business model, or can't show the potential for making profit using the business model in the future, you shouldn't be in business.  My point was that if you are making a small amount (diddly + 1), that by increasing the volume with a business model that scales well (digital deliver scales extremely well - retail outlets far less), you can generate a profit (diddly + 1M).  This is simple ECON-101 stuff.

I've said it before here a number of times, but I don't think BN should even be in the hardware business.  The money to be made is in software and content delivery.  They should contract someone to write an HTML5-based best-of-breed eReader app that makes it super easy to buy content through their website or acquire content via the local library.  This will run on any device with an HTML5 compliant browser - including a Kindle.  Partner with tablet manufacturers (HP, Samsung, Motorola, etc.) and get the eReader loaded on these devices when they go out the door.  The Agency Model is going to keep the prices of eBooks pretty much the same across BN's competitors, so the value-add is in the user experience (i.e. software).  I don't expect BN to ever do this though. They can't even do something as simple as set the background to black in their Night Mode.  I'm hoping that Microsoft might wake up and offer an eReader that works with .azw and .epub with their upcoming Win8 tablets, but I'm not holding my breath.

[roustabout]

"Employees are a means to an end, just as a retail store location is, or a rack of servers"

Actually, by granting business the right to form themselves into legally protected corporations which shield their principals in a number of useful ways, we actually do create a social compact with businesses.

Shareholders in particular would prefer that we not look into the history of articles of incorporation, business owners also would prefer that but probably less vehemently because they actually work with their employees.  Shareholders, on the other hand, expect that every investment will be profitable every quarter and get squally like little children when that isn't true.   

[doncr]

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roustabout wrote:

"Employees are a means to an end, just as a retail store location is, or a rack of servers"

Actually, by granting business the right to form themselves into legally protected corporations which shield their principals in a number of useful ways, we actually do create a social compact with businesses.

Shareholders in particular would prefer that we not look into the history of articles of incorporation, business owners also would prefer that but probably less vehemently because they actually work with their employees.  Shareholders, on the other hand, expect that every investment will be profitable every quarter and get squally like little children when that isn't true.   

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I'm sorry I don't understand how what you've posted equates to my position that a business' employees are another operating expense that needs to be kept in check if the business wants to succeed.  

Where is it written that a corporation must hire more people than is necessary to maximize shareholder value?

[Nom-de-Nook]

Deemure you ask where BN is supposed to make money?  I don't know.  I do know that the marketplaced doesn't care a whit how much it cost to make something.  They only know what it will cost them and compare the features against other things available.  I haven't seen a teardown showing what the NT costs to make but I know that people said BN wasn't making money on the NC but then they dropped the price to $199 so either they were making money at some point or they are losing a lot per unit now.

But either way, consumers don't care what it cost to make just whether or not it provides value at the cost to the consumer.  I would expect the NT to be discounted before Christmas either by more promotions (like the get $25 off with you MasterCard) or bu;y a NT get a gift card or something to keep sales momentum).  The NT is their best launch of any nook yet supposedly but since like Amazon they don't release actual sales figures we don't know what that means.

[deemure]

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Nom-de-Nook wrote:

Deemure you ask where BN is supposed to make money?  I don't know.  I do know that the marketplaced doesn't care a whit how much it cost to make something.  They only know what it will cost them and compare the features against other things available.  I haven't seen a teardown showing what the NT costs to make but I know that people said BN wasn't making money on the NC but then they dropped the price to $199 so either they were making money at some point or they are losing a lot per unit now.

But either way, consumers don't care what it cost to make just whether or not it provides value at the cost to the consumer.  I would expect the NT to be discounted before Christmas either by more promotions (like the get $25 off with you MasterCard) or bu;y a NT get a gift card or something to keep sales momentum).  The NT is their best launch of any nook yet supposedly but since like Amazon they don't release actual sales figures we don't know what that means.

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I agree and that's the problem.  People can't see past the cost to themselves and then get mad when quality just plain sucks.  And everyone is at loggerheads with everyone else.  Retailers try to turn a profit (they must) and the buying public wants cheaporrific stuff.  Stockholders want profits NOW and could care less for the most part about R&D for higher profits or continuing profits.  Since some stockholders are flighty and move from company to company they do not care about a future profits.  This and unreasonable demands from a buying public (yes, unreasonable) lead to products that are partially satisfactory and satisfying. 

I worked for a grocery store and their net "profit" was ten cents on the dollar.  In the olden days (I had a relative in grocery store marketing and another in hard goods marketing) net profits used to be somewhere around fifty cents on the dollar.  And it is not employees that have killed the profitability.  It's stores like Walmart and Amazon, by and large.

When I worked for that grocery store, I worked in the Deli where they sold Sara Lee meat products, often considered a very good product.  Not maybe the highest quality but always a safe bet.  At the time Walmart did not sell Sara Lee deli meat, but then they began to and everyone noticed the drop in quality.  Sara Lee was obviously forced by Walmart to sell for less and so unfortunately the quality dropped.  Of course higher end Deli meat doesn't have binders and fillers, but the SL meat started to be more like the lower end meat jello turkey and ham.  And, yes raw it is just like jello.

[doncr]

>>Sara Lee was obviously forced by Walmart to sell for less and so unfortunately the quality dropped.  Of course higher end Deli meat doesn't have binders and fillers, but the SL meat started to be more like the lower end meat jello turkey and ham.  And, yes raw it is just like jello.<<

You know what they say...  There's always room for Jello, and Nobody doesn't like Sara Lee!

No one forced Sara Lee to do anything.  They could choose not to sell their packaged meats at Wal-Mart and could still be producing something that isn't "jello-like" selling it elsewhere.  

What Wal-Mart typically does is tell manufacturers that if they want to sell a product in the thousands of  Wal-Mart stores across the globe that the price needs to match Wal-Mart customer's expectations (i.e. dirt cheap). So it was Sara Lee's own decision to alter their product to lower its price and make up the difference in increased sales revenue from being able to sell to the millions of Wal-Mart customers.

Was the Sara Lee brand tarnished by this decision?  Perhaps.  But that was Sara Lee's decision and one that they will have to live with.  I'm a Jennie-O fan, myself.

[deemure]

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doncr wrote:

>>Sara Lee was obviously forced by Walmart to sell for less and so unfortunately the quality dropped.  Of course higher end Deli meat doesn't have binders and fillers, but the SL meat started to be more like the lower end meat jello turkey and ham.  And, yes raw it is just like jello.<<

You know what they say...  There's always room for Jello, and Nobody doesn't like Sara Lee!

No one forced Sara Lee to do anything.  They could choose not to sell their packaged meats at Wal-Mart and could still be producing something that isn't "jello-like" selling it elsewhere.  

What Wal-Mart typically does is tell manufacturers that if they want to sell a product in the thousands of  Wal-Mart stores across the globe that the price needs to match Wal-Mart customer's expectations (i.e. dirt cheap). So it was Sara Lee's own decision to alter their product to lower its price and make up the difference in increased sales revenue from being able to sell to the millions of Wal-Mart customers.

Was the Sara Lee brand tarnished by this decision?  Perhaps.  But that was Sara Lee's decision and one that they will have to live with.  I'm a Jennie-O fan, myself.

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doncr, of course you know I meant in order to sell at Walmart any company is "forced" to sell for less. 

This was not pre-packaged meat, but meat that gets sliced up for customers, just to be clear. 

And no, they didn't have to sell there at all, it's true, but if they do Walmart forces them to sell for such rockbottom prices they can't help but do any combination of lowering quality, outsourcing, and/or just plain cheapening a product.  It always is a company's own decision to do this-I'm not debating that or refuting it at all.  This wasn't about Sara Lee's decision, but what it meant for customers.

I was merely pointing out that the way Walmart does business with its suppliers makes the cheapening of products necessary in order for them to sell.  And it's well-known that once a company starts doing business with Walmart, it's very hard to stop.  That's because doing so can ravage a business.  The quality drop was something that I'd always known happened with companies that start working with Walmart but it was painfully obvious to all of us that worked with this particular product. 

We all know the story of Levi's, the All-American company, and there's Huffy Bikes, and the list is endless, and all because Walmart saw something in always having the cheapest jar of pickles.