Analyst forecasts strong Amazon iPad challenge

Aug 29, 2011, 22:37 GMT

San Francisco - Amazon's widely expected iPad competitor could sell as many as 5 million units if it goes on sale in the fourth quarter of the year, according to a new report Monday by Forrester Research.

Apple has already sold almost 30 million iPads since they went on sale last year, and controls over 80 per cent of the tablet market as customers ignore numerous rival products from competitors like Acer, Motorola and Samsung. Total tablet shipments are expected to reach 60 million this year, up from 17 million last year, according to a recent study by HIS iSuppli.

But Amazon could pose a real challenge to the iPad, especially if Amazon repeats the strategy which made its Kindle e-reader so successful and sells the tablets at a loss in order to ensure market penetration.

Apple currently sells different versions of the iPad for between 499 dollars and 829 dollars and Amazon's device would provide formidable competition if it was priced significantly lower, said Forrester analyst Sarah Rotman Epps.

'Thus far, Apple has faced many would-be competitors, but none have gained significant market share,' Rotman Epps wrote. 'Not only does Amazon have the potential to gain share quickly but its willingness to sell hardware at a loss, as it did with the Kindle, makes Amazon a nasty competitor.'

Amazon has yet to announce a full-blown tablet version of its Kindle e-reader but widespread reports have indicated the leading online retailer is expected to introduce such a model running Google's Android operating system later this year.