Holiday Gift Guide 2011: Kindle Fire or iPad 2?

With Christmas drawing near, many people are looking for the perfect holiday gift. In the digital world, a tablet computer may be a good choice. During the fourth quarter of this year, Amazon, the world’s largest online retailer, launched a hard-hitting advertising campaign and powerfully presented the most awaited tablet, the Kindle Fire. But can it stand up to Apple's best-selling iPad 2?

Despite Apple's iPad 2 capturing a major portion of the tablet market, the Kindle Fire has been grabbing a lot of attention lately. So those buying gifts this holiday, may wonder - should they stick to the most popular tablet - iPad 2 - or buy the newest tablet on the block - Kindle Fire?

Compared to the expensive iPad 2, which is priced between $499 and $829 (depending on storage capacity and 3G option), the Kindle Fire is amazingly cheap with just one version, priced at just $199. Given that these days the economy is still struggling to take off, for families with a tight budget, the low-cost Kindle Fire definitely sounds like a better holiday gift. After all, one can buy three Kindle Fire tablets for the price of just one iPad 2.

Ever since Kindle Fire was released on November 14, 2011, it has flown off the shelves and has become the most successful product Amazon has ever launched. So far, it remains the #1 bestselling, most gifted, and most wished product on Amazon.com.

But can the $199 tablet computer compete with the super popular iPad 2? Amazon claims, “we've already sold millions of units and we're building more to meet the strong demand, but one may wonder exactly how many Kindle Fire did Amazon sell.

Last Thursday, the Seattle-based company revealed that customers had bought about one million Kindles in each of the previous three weeks. Yet we still don’t know how many Kindle Fire tablets were sold as the sales figure announced by Amazon may also include the five Kindle e-readers (with the cheapest e-reader priced at $79).

On the other hand, iPad 2 sales is still surging high and analysts expect Apple will sell 13.5 million iPads during the last quarter of this year or about 964,000 tablets per week.

To date, researchers estimate that Apple enjoys market share of 66 percent of the tablet computer while Amazon.com takes up a 14 percent share. Amazon's low-priced strategy is “Bad for margins, but it is giving them some share,” BGC Partners analyst Colin Gillis said.

Amazon's new tablet features a 7-inch touchscreen (1024x600 pixels resolution), 8 GB storage capacity, and 802.11 b/g/n Wi-Fi connectivity, but it does not have any camera and cannot support 3G network. On the other hand, the iPad 2 has A5 processor, 0.3 MP front- and 0.7 rear-facing camera, 3G connectivity, and a 9.7-inch LED-backlit glossy widescreen multi-touch display (1024x768 pixels resolution at 132 ppi).

In conclusion, if your budget is tight, go for Kindle Fire but if you do not want to compromise on quality or performance, buy the iPad 2.