Home How Amazon’s Kindle Fire is About to One-Up Handheld Gaming Systems

How Amazon’s Kindle Fire is About to One-Up Handheld Gaming Systems

With less than a week to go before Amazon starts shipping its Kindle Fire tablet, the company today announced the inclusion of several more Android apps. The list of new additions includes Netflix, Pandora, Facebook, Twitter and many other hugely popular apps.

Quite a few of the applications Amazon announced today are games. Apps from Zynga, EA, Rovio and a number of other mobile game makers are going to be included on the Kindle Fire, which substantially expands the catalog of games available on the device.

With everybody chattering on about what impact the Kindle Fire might have on other tablets like the iPad and Barnes and Noble’s new Nook, it’s easy to overlook another class of devices that may face disruption by Amazon: handheld gaming consoles.

iOS and Android: Already Disrupting the Video Game Market

In fact, this disruption is already well underway. Android and iOS have collectively begun to devour the lunch of established video game hardware manufacturers like Sony and Nintendo, according to a new report from Flurry Analytics.

Smartphones and tablets running iOS and Android will together account for nearly 60% of video game industry revenue in 2011. That percentage has in the last two years and the growth shows no sign of slowing down.

Evidently, the proliferation of tablets, smartphones and iPods, coupled with the growth of inexpensive mobile games is chiseling away at the old model of consumers spending $40 or $50 for a new game on a system from Nintendo, Sony or Microsoft.

Nintendo has already felt the heat from these trends. After it launched its much-hyped 3D handheld gaming system earlier this year, lukewarm sales forced the company to slash its price. They’ve also dropped prices on many of the games that were initially available for their Wii console.

Enter Amazon and, probably to a lesser extent, Barnes and Noble. The two companies are about to start shipping multi-purpose, Android-powered, touchscreen tablet devices that are priced competitively. Amazon’s offering will be available in over 16,000 U.S. retail stores. Neither device will single-handedly knock the iPad from its dominant position, but the availability of two entry-level tablets at half the iPad’s cost is sure to propel the growth of the tablet market overall. Analysts have predicted that Amazon could sell anywhere from 2-5 million Kindle Fires before 2011 is over.

If you think mobile games are doing well now, just wait until tablets reach 80 million U.S. consumers, something Forrester expects to happen by 2015. By then we can reasonably expect smartphone penetration to much higher than it is today as well.

Meanwhile, if these new devices from Amazon and Barnes and Noble do particularly well, Apple may be forced to reconsider its $500 starting price tag when it launches the iPad 3 in early-to-mid 2012.

No matter how you slice it, we’re going to see huge growth in tablet adoption a year from now. In addition to reading, social networking and watching plenty of video, the devices are going to continue to be used quite heavily for gaming, something Sony and Nintendo are surely aware of.

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