I recently purchased 80+ iPads and 30 or so Kindle Fires for a group of employees at work. Some people got iPad 2s, but most people got the New iPad (or iPad 3, as most people still call them in conversation) and a few people got Kindle Fires. An interesting thing happened… people were given the option to keep what they got or pay the difference to upgrade to another device. Almost everyone who got an iPad 2 wanted to trade up for the New iPad and all but 8 people who got a Kindle Fire wanted to trade it in for an iPad.
This was a pretty unique experiment. It's not everyday a person can observe over 100 tablets being distributed. I think the message is obvious and clear: when given a choice between an iPad and a Kindle, people prefer the iPad. Not only that, but they are willing to pay extra. Price was always supposed to be one of the reasons why a person would buy a Kindle Fire over an iPad. Sure, it wasn't as good, but it was cheaper. It was supposed to be “good enough.” Apparently not (even in a slumping economy).
I'm intrigued by Amazon's tablet offering. It's interesting, but it's not compelling. I think that people's values are changing. When the financial crisis struck in 2008, the American dream was all about buying a house and a nice car. Priorities have shifted now, especially for the millenials. The thing is, buying a house is increasingly out of reach for this generation, but, they can splurge on a smaller item… a tablet. In this case, they don't want to settle. They want the best and the best is still the iPad.