More bad news for Amazon as Apple prepares tablet launch

NEW YORK - Apple will launch its highly portable tablet computer in March or April with a 10 inch screen.

According to a report on Apple Insider the impending launch is based on activity within Apple's supply chain.

It quotes a research note by Yair Reiner, Oppenheimer analyst, who says Apple has been talking to book publishers about a "very attractive proposal" involving putting their content on an ebook platform.

The note said: "Our checks into Apple's supply chain indicate the manufacturing cogs for the tablet are creaking into action and should begin to hit a mass market stride in February.

"At this stage Apple appears to be sizing its supply chain to support production of as many as one million units per month."

The note went on to spell out details of the tablet device including the addition of a 10.1-inch multi-touch display - the same as the iPhone's.

The revenue split is 30/70 in favour of publishers, which compares favourably to the 50/50 deal Amazon offers for its Kindle.

The launch could spell bad news for Amazon which has angered all varieties of publishers.

Newspaper and magazine publishers are unhappy that Amazon takes 70% of revenues and retains most of the reader data.

This idea is backed further by a report from The Internet Analyst which says it found many newspaper and magazine publishers are not convinced that the Kindle will dominate the e-reader market.

The report said some local newspaper publishers it spoke to saw more potential in smartphones than e-readers like the Kindle and that magazine publishers want to create device-neutral content that can be read across a number of devices - from mobile phones to netbooks.

It said many publishers see netbooks as the winning platform because of its portability and price point.

It also argued that  analysts "are far too optimistic about the Kindle's potential contribution to Amazon's future earnings" in reference specifically to Apple holding talks with publishers to undercut Kindle on pricing.

It was recently reported that a number of publishers are working on e-reader and tablet demos including Conde Nast-owned Wired and Time Inc owned Sports Illustrated.