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  • dutchboyinvestor dutchboyinvestor Nov 29, 2012 7:15 PM Flag

    "we make money when people use the Kindle, not when they buy it"

    this is bezos today - since they rolled the kindle out 5 years ago they have not made a nickle on anything bought or sold on the devices - the kindle has served to the keep the stock price higher b/c it has allowed a completely false narrative to continue. with "millions" of kindles out there is use today amazon's margin is the worst its been in 5 years. Oh I know ...just wait..... it will happen next year or maybe the year after that... .

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    • Amazon loses A LOT of money with the sale of each unit. The whole issue with Amazon is that a merchendizing company is trying to do design, development, and production of products. This is extremely poorly managed. As an ex-Amazon employee I have to warn the people who own this stock. The business model Mr. Jeff B has put in place is not sustainable. He has to divorce his losing proposition and let them run it like a PC company, which is who they really are. Amazon content is now available everywhere. There is no good reason for anyone to buy Kindle products. I finally switched to iPad and so happy I did. I totally hated the Fire.

      • 1 Reply to kasrakia2002
      • Besides, there is a limited life expectancy on all consumer electronics including the kindle:)
        This is one more reason why I say this phat plump piggie is gonna take it hard one day.

        IMO there should be a complete SEC investigation into this non money making ponzi before it turns madoff on pension funds, and implodes, and grannie nellie is left high and dry because the pbgc wont be able to handle it because of its limited revenue.

    • What's the installed base of Kindles (including Fire) compared to iPads? How has that ratio changed over the past 3 years and 5 years? It was a defensive move people... Start thinking critically and stop buying all the sell side BS (I'll save the cloud critique for another day).

      The idea that a content distributor can earn supranormal profits from non exclusively distributing others' content when competitive distribution channels have broader reach and captive audiences (via iStore and Google Play) is laughable and stupid. But, that what almost every sell side analyst (aside from Gillis, who is the best of the bunch by far) has bought and been reselling. Inane.

      Kudos to Gillis for picking up the shipping cost thread. But, there is much more to it. It will have a much greater adverse impact upon Amazon's business model than anyone is currently recognizing... The are reinforcing feedback loops which will continually and increasingly undermine/degrade the economics of the business model. But, I will cover that another day...

      Sybs, I'm not all in yet. I've learned painfully how extreme these shakeout squeezes can get (though the absurdity here dwarfs NFLX, GMCR and CMG by far).

      Having said that, if I do one thing next year, it will be to end this scam through all legitimate means (e.g. providing critical analysis to the states/pensions/labor unions as how they are undermining their local economies by subsidizing Amazon facilities and by holding direct or indirect investments in Amazon).

      Last year I focused almost exclusively on CMG. The year before GMCR and NFLX. This year, it is all about Amazon for me. It is emblematic of all that is wrong with our capital markets and the funds playing these games have now made it worth my while... My early new year's resolution is to bring all of the collateral damage of scams like this to the attention of the general public, and Amazon is a perfect case study because everyone knows Amazon and everyone knows in their gut that there is something amiss here...

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