It's all about amortization. If the Kindle makes you a service more valuable than $12/month (for instance, because you save that amount in buying paper magazines), then a depreciation of $220 in a year and a half has paid off.

If you renew a $144 device in a year, or a $576 device in four years, you are operating on $12/month amortizations also.

It's a fake. You can tell because none of the monitors have any cables in them.

Prices would necessarily rise, though, since the total amount of money in circulation would rise, thus creating inflation.