Wal-Mart Stores Inc, the largest retailer in the US, said on Thursday it was dropping Amazon’s Kindle tablets and e-readers, a sign of how seriously it views Amazon as a competitor in the consumer goods market.
Target said in May that it would stop selling Kindles, although other stores, including Best Buy, Staples and Office Depot, said on Thursday that they would continue to carry the devices.
Wal-Mart did not specify why it was discontinuing its Kindle sales, but analysts said it was not hard to decipher, given that the retailer will still sell similar devices from companies like Apple, Google, Barnes & Noble and Samsung.
Physical retailers have been worried about customers who browse in stores and then buy from online competitors instead. Displaying the new Kindles encourages that behavior, analysts said.
While earlier black-and-white Kindles were only good for reading books, the newer Kindle Fire, introduced last year, can be used for e-books, movies, games and potentially anything Amazon sells, thanks to a built-in Web browser.
“The Kindle Fire is the Trojan horse,” said Andrew Rhomberg, the chief executive of Jellybooks, an e-book recommendation site. “It’s a shopping platform that covers so many more categories than e-books. It affects Wal-Mart in a different way than the early Kindles and e-readers did.”
Colin Gillis, a technology analyst for BGC Financial, said that by selling Kindles, Wal-Mart was “encouraging its customers to step into that ecosystem.”
“Every time you pick up your Kindle, they’re trying to get you to buy patio furniture” at Amazon, Gillis said. “If I were Wal-Mart, I certainly would not be encouraging my customers to go down the path of owning a Kindle and buying things from Amazon.”
Moreover, the Kindle line and most tablets are only marginally profitable for retailers, Forrester Research analyst Sarah Rotman Epps said.
“A lot of them have had it with tablets other than the iPad,” she said. “They’re not high-margin products, and other than Apple ones, no one is selling these devices in great volumes anyway. For Wal-Mart to drop Amazon is more of a symbolic blow rather than a substantive one.”
However, if more retailers back away from selling the Kindle, Amazon will lose valuable physical display space that it cannot match with a Web site, exposure that becomes especially important during the holiday shopping season.
“Amazon still needs a way to get the hardware into people’s hands,” Gillis said.
Amazon declined to comment on Wal-Mart’s decision.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
Clambering hand-over-hand, sweat dripping into his eyes, a durian laborer expertly slices a cumbersome fruit from a tree before tossing it down to land with a soft thump in his colleague’s waiting arms about 15m below. Among Thailand’s most famous and lucrative exports, the pungent “king of fruits” is as distinctive in its smell as its spiky green-brown carapace, and has been farmed in the kingdom for hundreds of years. However, a vicious heat wave engulfing Southeast Asia has resulted in smaller yields and spiraling costs, with growers and sellers increasingly panicked as global warming damages the industry. “This year is a crisis,”
HIGH-TECH: As leading-edge process technologies become more complicated, only a handful of players are able to provide design services, the company’s CEO said Artificial intelligence (AI) chip designer Alchip Technologies Ltd (世芯) yesterday said that revenue would grow significantly again in 2026 after adding a major AI chip customer, reversing moderation amid a product transition next year. The Taipei-based application-specific IC (ASIC) designer reiterated its strong revenue growth forecast for this year and 2026 after its stock plummeted about 23 percent to NT$3,145 from a peak of NT$4,085 on March 6 amid growing competition. Alchip said it has built strong partnerships with cloud service providers (CSP), denying that it had lost orders to smaller competitors such as Faraday Technology Corp (智原). Faraday said it has secured