Exactly. I don't get why Amazon would buy a new OS when it can get an existing well supported well publicized and we ll maintained OS for free. Currently they are freeloading on android which is a great thing to get all the android benefits without having to pay apenny for it. Why spend money on a new platform and then spend some more developing for it and inviting developers to it. I hope they don't make this mistake.
(1) Android is not free, ask Samsung about the $180 million check they're writing to Microsoft this year and the 20 court cases the have with Apple. There's potential liability with Oracle and if they put 3G/4G chips in them, Nokia. Then since Amazon is forking it they have their own development costs anyway.
(2) Amazon is locked out of Google Services and the latest version of Android, if ICS or Jellybean has a truly killer feature/service they could get their clock cleaned by other Android vendors. Hoping Google will always release the source early on releases yeah you might not want your eggs in that basket.
(3) Integrated development ala Apple can be the most profitable model. (or it can not, cough Palm)
(4) There's a lot of IP here and Amazon doesn't have a lot of patents.
(5) The tanking of everything WebOS may mean the price is very cheap. Maybe they implement a WebOS-like layer in Android.
(2) Amazon's market is different. They aren't competing with other "Android vendors." Yes it essentially runs Android, and by some peoples' definition, it's a tablet, but in the end what the Fire really is is a well-integrated portal to Amazon services and products. Nobody else can really offer that to consumers. Plus, it's highly unlikely that other vendors can afford to sell their hardware for $200.
Also, a lot of people seem to be assuming that Amazon is looking to upgrade the underlying version of Android. I think they are forgetting a key part here; Amazon is running a fork, and I think it's pretty likely that the only compatibility they care about is with Android Apps (and Bezos has said they will work hard to keep the Kindle Apps compatible with other Android platforms). The OS version doesn't matter at all, as long as the device is fast and pleasant to use, which by all accounts, it is here. There's really no reason they couldn't just keep working on their port indefinitely with no regard to what Google is doing with future iterations of Android. And if a new feature pops up that they like, nothing would stop them from cherry-picking it and putting it in to their fork.