Will Amazon’s New Product Line Better Compete With Apple?

Amazon (NASDAQ:AMZN) is launching a new version of its Kindle e-reader and tablet, according to a Reuters report. An anonymous source told the news service that the new releases will include a monochrome e-reader with front lighting. The source said Amazon is aiming to have the new e-reader in stores by July.

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The new Kindle will still run on E Ink’s display, the source said. Though Amazon’s Kindle e-readers have been popular, readers have had to buy external lights to attach to the devices when reading in the dark. A front light will eliminate that problem.

Barnes & Noble (NYSE:BKS) beat Amazon to that realization, remedying the problem with a glowing e-reader. Now Amazon is playing catch-up, as the bookseller’s Nook is already the No. 2 e-reader on the market, and threatens to overtake Amazon’s Kindle if the latter doesn’t evolve quickly.

The source said Amazon also plans to launch a new tablet — likely an upgraded version of its popular Kindle Fire –closer to the holiday season later this year. The new tablet is expected to have a bigger diagonal display, closer to the size of Apple’s (NASDAQ:AAPL) iPad. Apple, meanwhile, is said to be working on an “iPad Mini” that will be closer in size to Amazon’s Kindle Fire, with a smaller price tag to match.

Amazon is said to be offering two versions of its new Kindle e-reader: one 3G, the other Wi-Fi. And despite the addition of a front light, the source told Digitimes that Amazon is likely to keep prices the same, or raise them only by a very small margin.

The source also shot down speculation that Amazon could be working on a color-equipped e-reader, saying there was little chance of that this year.

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