Eliza has had a Kindle for a long time. Loves it. Adores it. Prefers to read on it more than any other way. And in my limited time playing with it I can say that if it wasn't for my having an iPad firmly in my grip about 18 hours out of the day I too would own a Kindle for reading.
When the Kindle Fire debuted I purchased one for the Viddler team to use for QA purposes. I had it shipped to my house so that I could do a little testing of my own. And, for a day or so, I gave the Fire a run-through. I wasn't impressed.
I wasn't impressed because the Fire was heavy, scrolled slowly, and the content catalog was lacking. So, effectively, it was a heavier, slower, reading device. But that isn't what Amazon had in mind for the Fire all along.
I think the recent Kindle press event really shows what Amazon's true vision for the entire Kindle line really has been. An affordable device line that helps you purchase content on Amazon no matter where you are.
I don't totally buy into Bezos' rose-colored ideals that Amazon really is trying to create Kindles without any profit whatsoever. He said so himself when he said he didn't believe in the razor/blade approach wherein the manufacturer of the razor loses money on the razor in hopes of selling blades in bulk. But, they're obviously slicing the sausage pretty thin in hopes of being able to break even on the positive side with Kindles. The prices speak for themselves. Amazon wants to sell content. A lot of it.
I think the graph that Bezos showed of the growth of book sales on the Kindle in comparison to physical book sales was very telling. The way people are buying books today is on the Kindle (the devices and the applications on iOS/Android). And, in just a few years since the first Kindle, people are buying more books through the Kindle than any other way. So, investing in the Kindle line seems like a no-brainer to me.
I suppose I'm writing all of this to say - I've always admired Amazon even though I don't say it as much as I say that I admire Apple. I like the Kindle even though I don't say that I do as much as I say that I like the iPad. I think Amazon is investing in exactly the right spot for Amazon and they're making excellent products that are stiff competition for every company in this space including Apple. And I think that's great.