The Kindle Fire is the tablet you need at the price you'll be willing to pay. The $199 device comes packed with content and features that are arguably better than what's available on the iPad, and at a fraction of the price. Wow.

Crucially, Amazon's powerful content library is already familiar and useful—many people already have dozens of Kindle books, for example. And Amazon has sneakily set its Prime members up with memberships that allow them to instantly stream thousands of movies and TV shows.

The device is light, can be held in one hand, and has a beautiful display. Not only that, Amazon built a special browser for it called Silk. Amazon is backing Silk with its Amazon Web Services cloud infrastructure, meaning the device does almost none of the processing. The idea is so brilliant I can't understand why no one tried it before*. Sites will load on Fire faster than they have on any other mobile device. Again, wow.

Key facts:

• 7-inch multitouch color screen (1024 x 600 resolution at 169 ppi; 16 million colors).
• Weighs 14.6 ounces.
• WiFi only, no 3G.
• Runs Android.
• Up to eight hours of continuous reading or 7.5 hours of video playback.
• 8 GB of internal storage but free cloud storage for all Amazon content.
• Browser includes Flash.
• USB 2.0 connector.
• Price: $199.

The Fire will ship November 15, and is available to preorder today.

Amazon CEO Jeff Bezos's presentation pulled together so many disparate Amazon services to power the Fire that the company's broad reach seems crazy like a fox. You could almost argue that Bezos has been building to this moment for years.

Apple headquarters must be in uproar now. Bezos just out-jobbed Steve Jobs, announcing a truly impressive device for a truly impressive price. To steal Jobs's favorite word, I believe the Fire is actually going to be a "magical" experience for people. The Fire is the first competitor to set its own standard rather than play catch-up. The phrase iPad killer has been misused, until now.

* Thanks to @darrenwaters of the BBC for pointing out that Opera mini already has some similar features.

We're at the launch of Fire now, so expect more coverage as the day progresses.

Amazon is still working to recover from outages this week, particularly problems resulting from a Sunday lightning strike in Dublin that knocked service offline for many European customers. Information Week reports that the company is struggling to restore data to some affected customers:

An error embedded in a piece of Amazon Web Services cleanup software has resulted in some customers having their backup data snapshots deleted from EC2's European data center. Amazon dashboard notices of the problem indicate most of the data was recoverable but it's not clear whether that happened in every instance.

The European outage has been longer in duration and harder to fix, but a 40-minute outage in North America Monday night illustrates just how significant Amazon Web Services has becoming to the proper functioning of the Internet. At the time of the Internet, Tech Crunch's MG Siegler wrote:

Are you trying to use the web right now? Just stop. It's largely broken.
As indicated by about 20 tips in the last few minutes and pretty much all of Twitter, Amazon's EC2 service appears to be down. That means services like Reddit, Heroku, Foursquare, Instagram, Fab, Quora, Turntable.fm, Netflix and many, many others are down.

There's a high cost for outages, both in lost transactions and lost customer trust, but Amazon's recent troubles illustrate how difficult it is to protect against all possible scenarios, according to Information Week:

Amazon needed disaster recovery capability with live data replication to be in place for many customers to avoid being caught in the outage. ... To avoid being caught in the European outage, Amazon customers would have had to take extraordinary measures to protect themselves before the incident occurred, said Indu Kodukula, CTO of SunGard Availability Services, a disaster recovery specialist firm.

And lest anyone think that Amazon is the only company subject to outages, the content-delivery network Akamai, responsible for delivering websites such as Apple.com, also experienced an outage this week. Dan Rayburn of Seeking Alpha writes:

One thing the Akamai and Amazon outages should prove to everyone is that even though all the CDNs always talk about the redundancy built into their networks, ALL networks have outages at one time or another. There has never been a network that hasn't had a major outage and there is no such thing as 100% up-time, no matter what any CDN claims or guarantees in an SLA.

This really underscores the inherent problems of maintaining web-scale systems. As I wrote in April, at the time of the last major Amazon outage:

"It's not just individual systems that can fail," says Neil Conway, a PhD student at the University of California, Berkeley, who works on a research project involving large-scale and complex computing platforms. "One failure event can have all of these cascading effects." A similar problem led to a temporary failure of Amazon's Simple Storage Service in 2008.

One of the biggest challenges, Conway says, is that "testing is almost impossible, because by definition these are unusual situations." He adds that it's difficult to simulate the behavior of a system as large and complex as Amazon Web Services, or even to know what to simulate.

Conway expects companies and researchers to look into new ways of testing abnormal situations for cloud computing systems. "The severity of the outage and the time it took [Amazon] to recover will draw a lot of people's attention," he says.

Amazon's new ad-supported Kindle, called Kindle with Special Offers, will retail for $114, or $25 less than Amazon's Wi-Fi only Kindle. The company says:

Special offers and sponsored screensavers display on the Kindle screensaver and on the bottom of the home screen—they don't interrupt reading.

However, some wonder why the price cut isn't more generous. Dan Costa writes:

Why $114 and not, say, the market-killing $99? Amazon hinted at reasons in our meeting, but basically it said that Kindle sales have been very price sensitive. Reducing the price to $139 lead to a huge spike in sales. A $25 price cut should be enough to do the same. Plus, I think it needs to save a big announcement for the holiday season. It isn't likely we will see another Kindle this year—at least not an E Ink-based reader, so a big price cut in the fall would be just the thing to make the Kindle the hot gift this holiday season. Again.

Dan Frommer notes that, though $25 may not seem like much of a discount, it could still take time for Amazon to recover that money:

Will Amazon eventually be able to sell enough ads and deliver enough impressions to make the subsidy more than $25? (About 2,500 impressions per device at $10 per 1,000 impressions. If you see an average 10 ads per day, that's still 250 days of use at that ad rate before Amazon breaks even on the $25 savings.)

Amazon's move is particularly interesting since it's the sort of thing people have been expecting from Google's Chrome netbook or similar devices. Mobile analyst Chetan Sharma noted:

While Google is focused on Facebook, Amazon is coming in from left flank. Beautiful.

The Kindle was already an example of sponsored connectivity--a trend I've previously covered. If it come to include even more sponsorship, that model could become the way of the future, argues Jason Gallagher:

Amazon should be credited for finding a way to slide another source of revenue into the world of the Kindle. The revenue generated from the ads, let alone if anyone actually clicks on them, should more than cover the $25 discount per unit. Plus, Amazon is appealing to the deal hunter in everyone. This practice goes along with the reason why companies like Groupon are so successful; they offer deals that are actually useful (at least once in a while).

The real amazing part is that no other company put this together sooner. If Amazon and the Kindle with Special Offers are successful, there is little doubt other companies with mobile devices could follow suit.