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Amazon's $499 Kindle Fire HD with LTE: Bargain or Rip-Off?

Today, Amazon surprised mobile industry observers when it announced a $499 LTE-enabled version of its new 8.9-inch Kindle Fire HD. Like the $299, Wi-Fi only version of the Fire HD, the LTE-enabled tablet has a 1920 x 1200 screen, a powerful dual-core TI OMAP 4470 CPU, and dual-band Wi-Fi radio.  For $200 more plus $50 per year for service, you get 32GB of internal storage, 20GB of Cloud Storage, a $10 app store credit and 250MB per month of data transfer on AT&T's LTE network. Is that a good deal for what you get?

By comparison, the 4G LTE iPad with 32GB of memory costs $729 plus $15 per month for 250MB on AT&T, for a rate of $180 per year without the 20GB of cloud storage or the $10 store credit. Verizon doesn' t have a 250MB plan, but it does offer 1GB of iPad data for $20 per month ($240 per year). 

If you want the Samsung Galaxy Tab 10.1 with 4G LTE, Verizon offers it for $629 plus a $10 per month device fee to go with a minimum 4GB "Share Everything" data plan that's $30 a month. All told, that's a data price of $480 per year. AT&T's website no longer offers new models of any tablet but the iPad. 

Clearly, Amazon's Kindle Fire HD with LTE costs less, both in terms of service and hardware, than its competitors.

TabletBase CostBase Level Data Per MonthService Fee for 12 Months
Amazon Kindle Fire HD w/ LTE (AT&T)$499250MB$50
Apple iPad (32GB) w/ 4G (AT&T)$729250MB$180
Apple iPad (32GB) w/ 4G (Verizon)$7291GB$240
Samsung Galaxy Tab 10.1 (32GB) w/ 4G (Verizon)$6294GB$480

Is 250MB per Month Enough?

For most users, 250MB per month of 4G data transfer is practically worthless. According to AT&T's data calculator, 250MB will allow you to:

  • View up to 729 web pages (estimated 325K per web page, 24.8 per day). However, AT&T's estimate of 325K per web page seems very low when you see that, by some estimates, the average web page is now 1,092K. At 1,092K, you could only view 228 pages per month. Of course, on your tablet, you may be viewing more mobile-friendly sites which would be a bit smaller.
  • Download 12,500 text only emails (estimated 20KB per email)
  • Listen to 500 minutes of streaming music (estimated 500K per minute)
  • Watch 50 minutes of HD video.

By Amazon's own estimate, 250MB won't even come close to downloading a standard def movie from its movie store. A few minutes before Amazon CEO Jeff Bezos said that the standard def version of the Hunger Games is over 750MB and the HD version is over 2GB. With such a small monthly cap, it would take you over 3 months just to find whether Bella chooses Edward or Jacob.

Unless you're planning to read text-only emails with no attachments, you're in grave danger of bumping up against the cap. And even if all you do is check email, chances are that you already have a smartphone or some other method of getting that information on the go.

Considering that you're spending $200 more for the hardware and $50 for service, you'd be better off buying the $299 Kindle Fire HD (or $369 unit with 32GB of storage) then finding a Wi-Fi hotspot or using your smartphone's mobile hotspot mode to connect from the road. However, if you do want more data, Amazon will be offering 3 and 5GB per month plans at AT&T's regular pricing of $30 and $50 per month.