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January 23, 2012

How Amazon Kindle Fire Generates $136 of Sales per User

80% of Kindle Fire owners have spent money on eBooks, with 58% buying more than three eBooks within the first two months of ownership.It expects
 Tablet users to  buy five eBooks per quarter, resulting in around $15 in eBook revenue per quarter

RBC polled 216 Kindle Fire owners for the study " On Revenue Generated" by Kindle Fire owners"  and said that Amazon is  making money by" monetizing consumption via Apps, Ebooks, Streaming Videos and music .Amazon 
 Kindle  sales  are expected to touch 3 to 4 million in Q4.2011

According to latest Research data  by RBC Capital, reveals that  Kindle Fire  owners  consume more content  and generates more revenue per user.RBC Data  provides insights on  how  Tablet manufactures are trying to monetize “ content consumption” across these devices across eBooks, applications including  movies and   streaming videos.

Some other  Finding on Tablet  Consumption and revenue  include
  • RBC Research analysis assigns an Average  cumulative Revenue per Kindle  Fire  as as  $136, with a cumulative operating margin of over 20%."
  • Paid apps made up the rest of the revenue, with 41% of owners buying at least three apps, if not more, over the same two-month period.
  • e-Book reading  was among the most popular usage of the Kindle Fire (71%), followed by browsing (31%), playing games (29%), using apps (20%) and streaming video (13%).
According to Tabtimes, the results are  not overly surprising  as analysts predicted that Amazon would not make money on the tablet itself, which is available for $199.99, but costs $201.70 to build, according to research firm IHS iSuppli. The assumption was that Amazon would be taking a hit on the hardware, but would drive revenue via apps, eBooks,Streaming Videos and  movies.