Amazon's new $199 tablet gets tepid reviews

SAN FRANCISCO Wed Sep 12, 2012 4:21pm EDT

An employee demonstrates the new Kindle Fire HD 8.9'' at Amazon's Kindle Fire event in Santa Monica, California September 6, 2012. REUTERS/Gus Ruelas

An employee demonstrates the new Kindle Fire HD 8.9'' at Amazon's Kindle Fire event in Santa Monica, California September 6, 2012.

Credit: Reuters/Gus Ruelas

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SAN FRANCISCO (Reuters) - Amazon.com Inc's latest $199 tablet computer got tepid reviews from some closely watched gadget reviewers, a potential hiccup for the world's largest Internet retailer as it tries to grab a bigger share of one of the hottest technology sectors this holiday season.

David Pogue of The New York Times said the 7-inch Kindle Fire HD has no camera on the back, no GPS navigation, no speech recognition, and trails Apple Inc's more expensive iPad in thickness, screen size, screen sharpness, Web speed, software polish and application availability.

Walt Mossberg of the Wall Street Journal said the 7-inch Kindle Fire HD is not as "polished, fluid or versatile" as the iPad. After prolonged use, some apps and content took longer to launch and web pages loaded more slowly through the new Wi-Fi technology, compared to the iPad, he added.

Ads "assault" users every time they start the device or resume using it, Mossberg also noted. Amazon said this weekend that customers can turn ads off for $15.

Consumer Reports highlighted the limited apps available for the device, while noting storage is bigger at 16GB but still limited. The tablet ships without a charger, which the magazine called "annoying."

"It may not be for everyone," said Paul Reynolds, electronics editor at Consumer Reports.

An Amazon spokeswoman did not respond to a request for comment on the reviews on Wednesday.

Amazon's new range of tablets, launched last week, are crucial for the company's goal of selling more digital content, such as ebooks, music, video, games and apps.

Lukewarm reviews could put off some potential buyers, but low prices for the new Kindle tablets will likely ensure solid sales, analysts said.

"The original Kindle Fire had similar tepid reviews last year, but it sold very well out of the gate," said R.J. Hottovy, an equity analyst at Morningstar. "There's enough intrigue about the software, features and services that come with the products to draw consumers."

Anthony DiClemente, an Internet analyst at Barclays, raised his estimates for Kindle Fire tablet sales on Tuesday and he expects the devices to help Amazon generate more digital media revenue.

The analyst is not changing sales estimates based on tepid reviews for the 7-inch Kindle Fire HD device. However, he said such reviews may help Google Inc's Nexus 7, a 7-inch tablet that was launched earlier this year to positive reviews.

The Nexus 7, which starts at $199, is the current "gold standard" for 7-inch tablets, Reynolds of Consumer Reports said.

Consumer Reports has not finished reviewing the 7-inch Kindle Fire HD, but Reynolds said the Amazon device is "looking like a pretty promising competitor."

The success of Amazon's new tablets also depends on whether Apple launches a smaller, cheaper iPad, which has been called the iPad Mini on Wall Street, according to DiClemente.

Apple launched its new iPhone 5 smartphone on Wednesday, but the company did not mention a smaller iPad.

Apple typically does not unveil new smartphones and tablets at the same event, according to Shannon Cross of Cross Research.

"There's a decent chance you will see something. Apple tries to blanket price points. The iPad 2 is $399, so there's a theoretical $299 or $349 price point for an iPad Mini," she said.

"I don't think their competitors are saying 'Thank goodness the iPad Mini didn't come out today,'" Cross added.

(Reporting By Alistair Barr; Editing by Tim Dobbyn and Richard Chang)

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