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According to a Wall Street Journal report, Amazon in on its way to launch a budget tablet priced at only $99, that’s half the cost of the cheapest Kindle Fire ($100 with ads). The company is looking at introducing the new tablet by the end of this year around Christmas season.

But the low price tag will mean a compromise on quality of the components. Amazon will have to use cheaper hardware components and also compromise on user experience. For instance, the $50 device will have a mono speaker, rather than stereo.

The report also mentions that Amazon plans to launch tablets with 8-inch and 10-inch screens along with the $50 device.

Mr. Bezos had set an internal goal of a $50 price tag for versions of both the Fire tablet and Kindle e-reader, but the e-reader screen technology from its vendors ultimately proved too expensive to drop the retail price.

“Will people tolerate a potentially inferior experience just because a tablet is $50? Amazon has to be very careful about what they’re giving up to get to that low price point,”

says Frank Gillett, a Forrester Research analyst.

While industry experts are skeptical about the company bringing a low-cost inferior quality product to the market, Amazon seems to be determined to push sales by appealing to the price sensitive customer.


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