Amazon bumped up the specs on the existing Kindle Fire today, but the big news is the undoubtedly the Kindle Fire HD 7-inch and Kindle Fire HD 8.9-inch tablets. Amazon, smartly, announced them not as "gadgets" but as "services" and positioned them as the best way to consumer Amazon content while also providing additional functionality like mail, web, and apps to round out the experience. Our own Kevin Michaluk, Stephane Koenig, and Ashley Esqueda were live at the event, and had a chance to check them out first-hand. (See the video above.)

We've already shown you how the new Kindle Fires match up to the iPad, Google Nexus 7, Microsoft Surface RT, and BlackBerry Playbook, but Amazon also had a lot of really interesting features to go along with their "Kindle as service" pitch.

  • The display looks great. At 1920x1200 and 254ppi, it's not quite as ridiculous as the iPad's 2048x1536, 264ppi Retina display, but no human is going to be able to tell the difference.
  • The speakers are stereo and have Dolby DIgital audio, which embarrasses the tiny, tinny iPad speakers (though former sound engineer David Barnard rightly points out, mobile devices will never be the best audio experience.)
  • They're priced not only to sell, but to kill. The 7-inch Kindle Fire starts at $199 and the 8.9-inch at $299. However, those prices are subsidized in part by "special offers", which are ads shown as screen savers, and by Amazon's expectation that you'll buy lots of content from Amazon to use on them. It's a razor-blades vs. razor model, the opposite of Apple, who runs iTunes just above break-even to make their hardware more attractive for you to buy. It would be nice to have an ad-free option.
  • Amazon is aiming the Kindle Fire HD Wi-Fi at 5Ghz only, which is a much clearer band. Almost all routers should support that now. They're also including two MIMO antennas (Jeff Bezos spent an almost awkward amount of time on this), so reception will be great.
  • Amazon's cloud storage is free and unlimited, though like Apple that appears to be constrained to the stuff you actually buy from them.
  • KindleTime allows parents to lockdown everything except book-reading. Videos, gaming, can all be limited, and the screen turns blue so parents can easily see it's engaged. That's a really smart. Profiles in general are really smart.
  • Like Apple's Game Center, Amazon is offering GameCircle to bring the social, competitive aspect to the Kindle Fire HD.
  • X-Ray for movies puts IMDB into the video, so you can tap the screen at any time to find out more about the actors and production you're watching. Likewise, X-Ray for books will tell you about what you're reading. This is either amazing or annoying, but I want to try it and hope it comes to the Amazon iPad video app and Kindle app.
  • Whispersync is now going to work with audio books, movies, and games as well. And if you have an audio and text book, you can use Immersion Reading to look and listen at the same time. Also a great feature.
  • There's also an LTE version of the Kindle Fire HD 8.9-inch which gives you a year's worth of data for only $50. That makes the TCO of a 32GB Kindle Fire HD 8.9-inch about $400 cheaper than an iPad 3 LTE over the course of a year. Or it would if Amazon didn't have an incredibly low data cap of 250mb a month on that LTE service... No word yet on whether or not you can get a beefier plan if, you know, you actually intend to use LTE on the device.

Some problems still remain, however. The Kindle Fire line is based on Android and runs Android apps, and Android has had almost not luck building any momentum for tablet apps. That means you'll mostly get smartphone-class apps, which essentially makes the Kindle Fire a big iPod touch. The iPad (and the rumored iPad mini run tablet-class apps, and that makes a huge difference.

Apple also sells the iPad in over 90 countries. Amazon has thus far only managed the U.S. and the U.K. for the Kindle Fire. That makes it a non-starter for most of the world, and that's a very big problem. iTunes was a huge international advantage for Apple, and if even Amazon and Google are having trouble getting content deals on a global level, it doesn't bode well for short term competitiveness.

Also, Amazon is even more closed and more draconian than Apple. So for those for whom Android is a welcome alternative to Apple's control, the Kindle Fire won't be any alternative at all. The trains will run on time, you just won't want to be on them. (Funny, though, how Apple gets marketed against, and called out as, being "closed" but Amazon hasn't faced any of that... yet.)

Lastly, while Amazon impressed with their products today, the presentation made me really appreciate just how good Apple is at providing clear, consistent information during their keynotes. Amazon told a story about what interested them (MIMO!), not what made things clear for viewers. They jumped around and never put up slides that showed product grids -- which devices had which specs at which price points. Apple almost always concludes with those. They tell you what they're going to show you, they show it to you, then they tell you what they showed you. Amazon would do well to nail that part of an event too.

Overall, however, Amazon's willingness to subsidize hardware with ads and content expectations create a pricing challenge for Apple. As North American cell phone contracts show, customers care most about low, up-front pricing. Is a Kindle Fire HD 8.9-inch at $299 going to put a serious dent in US sales of an iPad 9.7-inch at $499? Is a Kindle Fire HD 7-inch at $199 going to make Apple stay aggressive with the rumored iPad mini price of ~$199 - $250?

Apple is rumored to be having an iPad event in October, so we won't have that much longer to wait and see.

Meanwhile, for more Kindle Fire coverage, keep it locked to Android Central, and if you want to grab any of Amazon's new Kindles, you can do so via the link below, and help support the Mobile Nations network at the same time.