Peter Kafka

Recent Posts by Peter Kafka

Walmart Fires the Kindle

Amazon says it has been selling a lot of Kindles and Kindle Fires, but it’s not going to be selling any more with the help of the world’s biggest retailer.

Walmart has stopped selling all of Amazon’s hardware, a move it chalks up to its “merchandising strategy.”

Reuters first reported the news. Here’s the statement from Walmart PR (no comment from Amazon):

Recently, Walmart Stores, Inc. made a business decision to not carry current Amazon products beyond our purchase commitments and existing inventory.

Our customers trust us to provide a broad assortment of products at everyday low prices, and we approach every merchandising decision through this lens.

We will continue to offer our customers a broad assortment of tablets, eReaders and accessories at a variety of great price points. This decision is consistent with our overall merchandising strategy.

So what does that really mean?

Here are two potential theories, which aren’t mutually exclusive:

This is about price: Walmart can’t get the margins it wants from Amazon.

This is about more than price: Walmart sells a lot of books, music and video from its stores, and that may lead to a conflict with Amazon, which has made no bones about the fact that it views its hardware as retail outlets for everything else it sells, like books, music and video.

The only problem with both of those theories is that you could apply some or all of them to all of Walmart’s other hardware suppliers. The retailer continues to sell tablets from Apple, Google and Barnes & Noble, all of which drive hard bargains themselves, and all of which compete with Walmart for media sales, too.

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Another gadget you don’t really need. Will not work once you get it home. New model out in 4 weeks. Battery life is too short to be of any use.

— From the fact sheet for a fake product entitled Useless Plasticbox 1.2 (an actual empty plastic box) placed in L.A.-area Best Buy stores by an artist called Plastic Jesus