We already know that Amazon’s Kindle Fire is a hit: it’s reached the top of Amazon’s internal sales charts and has made a good bit of buzz on its rock-bottom price. Now a supply chain analyst is predicting that Amazon could order 5 million Fire tablets before the end of the calendar year, making it the first tablet seller to truly rival Apple’s iPad. Between Amazon’s selling prowess and its integration with its own digital library, they’re poised to make an incredible entrance into the tablet market.

It’s important to note that analyst Ashok Kumar’s predictions deal with Amazon’s OEM operators and suppliers, not actual sales. That is to say, by the end of Q4 the company could have as many as five million Fire tablets in its warehouses, ready to go out to eager holiday shoppers. Current estimates put the Kindle Fire at between 250,000 and 500,000 sold just in preorders.

The Kindle Fire is based on an extremely modified version of Android 2.3 Gingerbread, designed to display Amazon’s retail and digital services prominently. To that effect the hardware itself is a loss-leader, costing Amazon slightly more to manufacture than the $199 selling price. While it won’t have access to the Android Market, Amazon’s own App Store will feature a lot of the same apps, and more should be added as the Fire gains in popularity. Kindle Fire orders begin shipping out on November 15th.

[via SlashGear]