During the debut of Amazon's new Kind Fire HD tablet yesterday, CEO Jeff Bezos wasted no time in getting down to business: Amazon wants to take on Apple -- and maybe the world. During his time on stage, Bezos compared Amazon's business model with the Cupertino, Calif., company's approach. He also directly pitted the $499 Kindle Fire 8.9-inch HD 4G against the iPad, claiming that with the Kindle Fire's $49.99 annual data package, consumers will see "more than $400 in year-one savings" compared to a similarly equipped 32GB iPad and a comparable data plan.

In a former airplane hangar in Santa Monica, California, Bezos unveiled a slate of new products that will also compete with rival devices from Google, Microsoft and bookseller Barnes & Noble. "We want to make money when people use our devices, not when they buy our devices," Bezos said.

Bezos unveiled two new versions of its bestselling Kindle Fire tablets he intends to use to drive use of Amazon's expanding online video library.

The Kindle Fire HD comes in a 7-inch and 8.9-inch version and will sell for $199 and $299, respectively, for a 16GB model. The new product will have two wi-fi channels for faster transfers.

The basic, 7-inch Fire model will cost $159, down from $199 for the original model. Amazon is also dropping the price of its low-end Kindle to $69, from $79. Both will start shipping next Friday.

"We haven't built the best tablet at a certain price. We have built the best tablet at any price," said Bezos.

The company also released a new e-reader, Paperwhite, featuring a new higher resolution monochromatic display and a body that is "thinner than a magazine, lighter than a paperback", Bezos said. Paperwhite, priced at $119, is lit from above rather than from the back, which, according to Bezos, made it "perfect in direct sunlight". A model with a 3G connection will cost $179.

Paperwhite starts shipping on 1 October in the US, and will also be available in the UK.

The Kindle Fire has captured 22% of tablet sales in the US in the nine months since it went on sale last November and has been the company's top-selling product since launch, Amazon said last week. But the sales leave Amazon trailing far behind Apple's far more powerful iPad devices which accounted for 68 percent of global tablet shipments in the second quarter, compared with Amazon's percent, according to research firm IDC.

Apple is rumored to be looking at launching smaller, cheaper tablets - it's whispered to debut the iPad Mini sometime this fall, possibly at its event Sept. 12 -- that will further intensify the fight between the two firms while Amazon has considered launching a mobile device that would compete with Apple's iPhone.

Amazon's latest move comes after both Google and Microsoft have made forays into the tablet market. In July Google launched the Nexus 7 tablet, a $199 device about the same size as a Kindle Fire but with more computing power and a camera. In June Microsoft announced the launch of a series of tablet PCs dubbed Surface that will go on sale in October.

The online retail giant has been building its media ties in order to compete with Apple and its rivals. Earlier this week Amazon announced a deal with film distributor EPIX, which counts recent blockbusters including The Avengers, The Hunger Games and Thor among its titles.

While some experts and online pundits immediately said Amazon just became Apple's No. 1 rival, other analysts disagreed.

"While there were some interesting new features and upgrades from the original version that could provide increased competition for non-Apple tablets, we walked away from this announcement with even greater confidence that the iPad will continue to dominate the tablet market at the mid-to-high end," said Brian White of Topeka Capital Markets, in a note to clients.

"The 4G version ... will have a difficult time gaining traction, while the November 20 dates are much too far into the future," White added.

Brian Marshall of the ISI Group was just as certain that Apple had little to worry about.

"While Amazon's new products look impressive, we believe Apple remains the dominant vendor/platform of choice for smartphones/tablets," said Marshall in his note to clients.

Their reasons centered on several factors, including Apple's App Store, which offers hundreds of thousands more apps than does Amazon's, or any other competitor for that matter, Apple's iCloud storage and synchronization service, and the expected launch of a small iPad, dubbed the "iPad Mini," perhaps as early as next month.

The last of those three -- the iPad Mini -- is Apple's ace in the hole, White and Marshall said.

"We believe the soon-to-be-launched 'iPad Mini' at a $250-$300 price point, possibly a bit lower, will expand [Apple's] addressable market opportunity significantly with a 7.85-in. tablet and potentially eventually surpassing sales of the regular-sized iPad," White said.

Patrick Moorhead, principal analyst at Moor Insights & Strategy, writing in Forbes, also pitched in on the Kindle vs. iPad tussle.

Arguing that Amazon's move was "by no means [a] victory," Moorhead cited several advantages Apple held, including the yet-to-be-confirmed iPad Mini. "The sheer fact that Apple will launch a tablet at that low price will bring in consumers in swarms," he wrote. "Yes, consumers will be able to get the Kindle Fire HD 8.9-in. tablet with 1,920 by 1,200-pixel resolution for $299, but they're also not getting the Apple brand and experience."

The three analysts concluded that Amazon, even with impressive hardware, aggressive pricing, and a content ecosystem in the best position to take on Apple, ultimately won't be able to unseat the iPad. According to IDC, the iPad accounted for 68 percent of all tablet sales in the quarter that ended June 30, up nearly seven percentage points from the year's first quarter.

"This announcement will do little to halt the momentum of Apple's iPad franchise that continues to gain momentum around the world," White predicted.

Shares of Amazon.com Inc. rose nearly one percent in Friday's premarket trading as analysts said the company's updated Kindle Fire tablet computer and new e-reader models could sell in the millions and ramp up demand for its content. Amazon's stock gained $1.82 to $253.20 before the market open.