Time will tell. I suspect that the digital media market is not large enough to provide meaningful subsidies at this stage, especially since a huge portion of tablet time is spent on the web and in email. When customers want to buy a movie, they'll probably use whatever ships on the device they have already purchased. The better device wins--people aren't going to choose a tablet based on customer service or even content selection; witness Amazon's failure in the music market.

If this is true, than Google has the stronger position, as they can afford deeper subsidies on the device through advertising. I don't know what Google pays to be the default search engine on the Fire or the iPhone, but it is significant.