Amazon Gearing Up to Challenge Apple's With its Tablet Computer

Amazon has reportedly entered into a contract with Taiwan based Quanta Computer for supply of tablet computers starting the second half of this year.

According to Digitimes, Amazon tablets will use touch panels with Fringe Field Switching (FFS) displays sourced from E Ink Holdings (EIH).

Amazon's monthly off-take from Quanta is expected to peak at 700,000 to 800,000, suggesting that the company's entry into the already crowded tablet market isn't a me too effort, rather a hard push.

Quanta is currently OEM for RIM and Sony tablets and has been plugging itself as OEM for Lenovo's second-generation LePad.

Amazon's new tablet isn't a replacement for its Kindle e-book reader, which continues to show strong sales, though only in the US; its a frontal attack on Apple's near oppressive dominance of the tablet market.

With its marketing muscle and huge client base, Amazon can more easily challenge Apple than technology giants such as Samsung and Motorola.

By tightly integrating its services - e-books, streaming music and video - Amazon could price its tablet device aggressively, discounting it against the increased sales revenue that it would generate.

Barnes and Noble has similarly priced its Nook Color tablet aggressively at $250, when similarly speced Android tablets cost upward of $350.

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