Amazon.com Inc (AMZN)

[krk]

Bezos is channeling Svengali, not Steve Jobs!

The recent frenzied media coverage about Amazon’s Price-Check App price-snooping $5 bribe got me thinking how masterful a job Bezos has done in conning the media into giving it free advertising as the go-to destination for bargain holiday shopping. I can’t imagine many shoppers will actually take the trouble for a mere 5 bucks, but the buzz and the extra sales will surely eclipse any costs.

And recently, the media were also conned into helping fan the meme about the low price for the Kindle Fire. Not just a garden variety low, but a "Crazy Eddie" kind of "so low he is practically giving it away" insanely low irresistible bargain. First hand I can tell you, for this reason alone it has ended up on the Christmas shopping list of several gizmo-skeptic but bargain-loving members of my immediate family.

My notion that "the below cost" pricing for the Kindle Fire is just a marketing myth is supported by this announcement by a Chinese outfit, Ainol, of a $99 7-inch Andriod 4.0 icecream tablet with capacitive-touch, front/back camera, 1080p video etc… i.e. several added features and costs over the Fire. If such a pricing can be accomplished by a company that is to be sold via retail channels with its own margins and without any razor/blade biz model implies that the cost of making these gizmos may not be all that high.
http://www.pcworld.com/article/245495/tablet_priced_under_100_with_android_40_surfaces.html

This has also helped Amazon sandbag its 4Q earnings expectation and its actual performance will no doubt be heralded as proof how this juggernaut’s lean/mean biz model has squeezed the profits even while selling a Kindle Fire “loss leader” and how this is proof positive of its razor/blade biz model and help whip up its share price beyond its already lofty level.

Bezos as the next Steve Jobs and Amazon as the next Apple is another meme that the media is conned into fanning. " ..Jeff Bezos is channeling Steve Jobs. .. Almost giddy with excitement, Bezos retrieves one by one the new crop of dirt-cheap Kindle e-readers ..When he’s done showing them off, he stands up, and, for an audience of a single journalist, announces, “Now, I’ve got one more thing to show you.” He waits a half-beat to make sure the reference to Jobs’ famous line from Apple presentations hasn’t been missed, then gives his notorious barking laugh."
http://www.oregonbusiness.com/the-latest/5957-amazons-bezos-unveils-kindle-fire
http://seekingalpha.com/article/312363-amazon-on-its-way-to-becoming-apple-s-no-1-contender

From his virtuoso manipulation of the media so far, he is for sure channeling Svengali.