Amazon currently sells versions of its E-Ink eReaders that display ads on the Kindle screensaver and at the bottom of the home screen. In exchange for viewing the ads, customers get a price break. The entry-level Kindle, for instance, is $79 with "Special Offers" (meaning advertisements) or $109 without ads. The Kindle Touch with ads is $99; the ad-free model is $139.

Amazon reportedly is seeking $600,000 to $1 million or more for ad campaigns that would run two months on the Fire, Ad Age says. If true, Kindle Fire ads may be more sophisticated--and possibly more intrusive--than the subtle ads on the E-Ink Kindles.

Would Kindle Fire owners be annoyed by the ads? Possibly, particularly if the ads hog too much space on the home screen, and if they're obnoxious, flashy, and noisy. Then again, a reduced price tag--similar to Amazon's cut-rate offer for its ad-supported eReaders--might help soothe users' ire. Kindle Fire users, after all, are a pretty pragmatic bunch. They know the $199 Fire may not be the most advanced color tablet available, but the price is right and the Fire is good enough for their needs.

It seems to me that a $169 Kindle Fire with Special Offers would be a holiday hit.

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