The Verge reports:
Amazon’s new lineup of tablets don’t just differ from the original Kindle Fire in their hardware. Like last year’s cheapest Kindle e-reader, all three new models — that’s the Fire, the HD 7, and the HD 8.9 — will display Amazon’s “Special Offers” promotions and advertisements on their lock screens. Unlike the low-end Kindle, however, Amazon isn’t offering the devices in more expensive, ad-free models, nor is it making mention of any way to opt out for a fee.
Those aggressively low Kindle Fire prices are making more sense. There’s no doubt that Amazon’s profit margins on tablets are slimmer than Apple’s, but by subsidizing them with ads it shows that Amazon is no longer willing to give them away at cost.