No, I'd say it's embedded in Amazon's stock price. They presumably already sell the Kindle hardware for a loss.

That subsidized price being determined by a calculation of how low it may be and still return a sufficient lifetime profit given the recurring revenue thereafter; should litigation costs rise, the price at which it is offered will adjust to maintain the same rate of return.

It's bad news for both Amazon and consumers that the device is relatively fragile (I assume he's not lying about the severity of the drop). Either the price stays high because Amazon pays out many replacements, or the price can stay low for those who baby the device, and high for those who drop it.

Paul Gowder isn't complaining about Amazon forgetting to tell him that his coffee is hot. Good for him, flexing his rights over something reasonable.

*E: I hereby disown this comment :)

If you went back and read about the McDonald's hot coffee case, I suspect you'd find that reasonable too.

http://en.wikipedia.org/wiki/Liebeck_v._McDonald%27s_Restaur...

He did nothing wrong. Just pointing out that Amazon doesn't really care. Some way or the other, you (the customer) is paying for it.

I see. I misunderstood you then. Yeah, it's a little like when taxes are raised (not sales tax). The consumer pays for it.