The WSJ is reporting that Amazon is going to strip down a 6-inch tablet and sell it for $50 for the holidays. What’s amazing is that the theoretically color tablet was cheaper to make than even an ebook display version:

Mr. Bezos had set an internal goal of the $50 price tag for versions of both the Fire tablet and Kindle e-reader, viewing the rock-bottom prices as a crucial lure for a more cost-conscious group of buyers, the people said. But the e-reader screen technology from its vendors ultimately proved too expensive to drop the retail price, the people said. Amazon’s cheapest Kindle sells for $79.

It is likely that the $50 Tablet will be a pared down version of the already minimalist $99 6-inch Kindle which has gone on sale for as little at $69 in recent months. The report cites a mono speaker as one of the cost cutting initiatives but the company will likely drop things like cameras, display quality and battery life.

What might be more interesting to me is that Amazon is said to have fired many from its FireOS group in the wake of the Fire Phone flop and subsequent $170M writedown…

After the Fire phone flop, Amazon reorganized its Silicon Valley-based hardware-development center known as Lab126 and laid off dozens of engineers who worked on the device, according to people familiar with the matter. The division has developed Fire tablets, Kindle e-readers, the Fire TV set-top box and other devices…To lower costs for the new 6-inch tablet, Amazon outsourced much of the development to overseas firms including Shanghai Huaqin Telecom Technology Co. and Taiwan’s Compal Communications Inc., rankling some at its Lab126 unit, two of the people said. Compal has previously worked with Apple and Hewlett-Packard Co., among others.

As someone who would like to see Amazon use Google’s authentic Android, this has me wondering if Amazon is looking to go to a more Vanilla Android experience. With the Barnes and Noble Nook getting all kinds of goodies from Google because it doesn’t fork the OS, the tradeoff of less work, more /better apps has to be enticing. The tradeoff is control but Amazon’s a

Amazon is also expected to release a larger 10-inch tablet later this year a full inch bigger than the current largest Kindle and perhaps looking toward the iPad Pro.

As of now, brands like RCA have 7-inch tablets selling on Amazon for as little as $40

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