Amazon's Kindle Fire catches on

It looks like the American obsession with shopping has created a new tablet star.

According to Reuters, the Kindle Fire sales surged on Black Friday giving the gear a significant so-called “traction” in the market.

Amazon claims that punters bought four times as many Kindles on Black Friday as they did on the same day last year, but given that was before the Kindle Fire was introduced, we are not that surprised.

What was more surprising was that the $199 Fire was the best-selling product on on Black Friday and it has been the top seller over the eight weeks since the tablet was launched.

Apparently punters are buying multiple Kindles, one for themselves and others as gifts.

Dave Limp, vice president, Amazon Kindle expects to make a lot of dosh as people buy them in the run up to Yule.

While the Fires are not as flexible as the iPad and don’t have a camera, they have the advantage that they are much cheaper and have the words “don’t panic” printed on the front cover. Actually we made that last bit up.

The news has been seen by Amazon’s share holders as proof that the Fire will be a viable rival to the iPad and that Apple’s walled garden of delights will be replaced by its version of the Garden of Eden. Amazon shares rose 6.2 percent in afternoon trading on Monday, which was more than double what the rest of the NASDAQ was doing.

The Kindle Fire is being sold at a loss in the hope that Amazon will make up the sales by selling more more digital products such as e-books, apps, video games, music and movies.

The tablet is in more than 16,000 retail stores to try to get the device into as many paws as possible. For Amazon’s cunning plan to work, it has to have a critical mass of users.

It seems to be going that way. According to Nik Nayar, vice president of merchandising at Target, the Kindle Fire was the best-selling tablet in Target stores. This is telling because Target also sells  the iPad. Ipad sales were not even improved by the fact that Target offered a $75 gift card when customers bought an iPad 2 with 3G.

Goldman Sachs analysts said that Kindle products were “very sharply outselling” Nook devices from bookseller Barnes & Noble.

In a report, Goldmine Sex said that now Amazon has a more competitive suite of hardware, its hardware share should increase, and its e-book share should follow.