Horace Dediu lays out the case against the Kindle Fire as a low-end tablet disruption. In the long-term, I’m convinced that Dediu is correct, but I think there’s a significant possibility that the Fire is going to steal away some market share from the iPad in the short-term.
I posit that most people don’t need something that’s technologically cutting-edge to scratch that tablet itch. And if you give them a choice between a $200 tablet that can do most things they need, or a $500 that can do slightly more things, the choice will be pretty obvious.