Amazon, Inc. – Tablet Potential Based on Patent Data

With 21 patents related to portable computing devices and associated software, Amazon is dwarfed by the more established tablet players (as covered in our report, The US Tablet Computing Market, July 2011).  With its current patent portfolio, Amazon owns approximately 0.2% of total tablet-related patent filings in the United States.  Moreover, Amazon has not filed any touch display-related patents since November 2008.  The more established tablet players, however, have since filed a combined 5,100 patents.

Despite this lack in touch display-related patents, Amazon has enjoyed enormous commercial success with its Kindle e-reader, giving consumers a reliable, no-frills e-reader at a low price.  Unsurprisingly, Amazon’s patents all relate to various aspects of its Kindle line.

Since the introduction of the Kindle by Amazon in 2007, tablet technology has quickly evolved in terms of functionality, usability, and connectivity.  Our research indicates that Amazon is yet to file a single true tablet-related patent, as its current patent portfolio is clearly directed to its e-reader technology.  Amazon has carved out a niche in the e-reader market, which offers significantly fewer features than today’s modern tablets.

Amazon’s patent portfolio covers the following technologies: Device Hardware (4); Display Software (7); and Graphical User Interface (GUI) (10).

This combination of patents accurately describes features and usability technologies available on the current Kindle – including text display functionality, active scrolling features, content updates, and content purchases through the Kindle store.  Strikingly, despite releasing a successful GUI to power its Kindle device (and being the first successful player in the e-reader market), Amazon has not filed any GUI-related patents since May 2008.  In the same time period, its tablet competitors have filed over 1,400 combined tablet GUI patents alone.

An analysis of Amazon’s patent portfolio also reveals key tablet technologies in which Amazon lacks any patent filings – Input Recognition, Multimedia, Motion Sensors, and Wireless Communication.  Lack of proprietary technology in these areas suggests that any standard feature – be it a simple hand swipe recognition, internal video player, or tilt-meter for gaming – would be licensed from other third-parties, possibly even competitors.

With no new patents to update Amazon’s existing e-reader platform for future advanced tablet devices, we believe Amazon will be forced to license most of its tablet technology.  Given Amazon’s purchasing power, this may certainly be cost-effective; yet there is no guarantee that Amazon will be able to secure innovative  technologies to set it apart from Apple, Samsung, and the likes.

Amazon’s rumored tablet will most likely run on a simplified Android platform.  Given Amazon’s lack of proprietary multimedia capabilities and features, it is unlikely that Amazon’s tablet would warrant an advanced Android 3.x Honeycomb platform.

Amazon seems to be aiming for a stripped-down version of a tablet at an affordable price point.  Its patent filings, at least, indicate the new tablet will be fairly stripped of any innovative features that will allow Amazon to have a multi-generation tablet line that seriously competes with feature-rich Apple, Samsung, LG, and Motorola (soon to be Google) devices.

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