Amazon Chief Executive Jeff Bezos confirmed on Thursday that the online retailer sells its Kindle e-reader "at cost", with profit coming instead from sales of online content.
Bezos' remarks, in an interview with the BBC, marked the first time the company had confirmed long-held Wall Street assumptions that it did not make a profit on sales of the popular tablet.
The aggressive pricing furthers Bezos' goal of getting Kindle tablets into the hands of as many buyers of Amazon's online content - from games and books to video - as possible.
Apple, by contrast, makes much of its profit from hardware sales. It sells a single-sized iPad at costs ranging from US$399 to US$829, depending on storage capacity, screen resolution and wireless connectivity.