Amazon's Fire phone launch: Hits, misses, and takeaways

Amazon's Fire phone launch: Hits, misses, and takeaways

Summary: Amazon's dynamic perspective and Firefly could be hits with developers, but ultimate sales remain to be seen. One disappointment: Amazon didn't upend the traditional carrier business model.

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SEATTLE — Amazon's launch of its Fire phone brought a 3D display system dubbed dynamic perspective, Firefly (which could turn the device into a kiosk in your pocket), and showed signs that the company can innovate on the hardware front and leverage its Prime subscription base and ecosystem. Unfortunately, some of the questions going into Amazon's launch have gone unanswered.

CEO Jeff Bezos delivered a strong performance and noted that the company's hardware strategy — just like Amazon's e-commerce and cloud ventures — revolve around the customer. Bezos said:

The most important thing that we've done over the last 20 years is earn trust with customers. We've worked hard to do that. You don't ask for it. There is a simple recipe for earning trust: Step one, do hard things well. Step two, repeat. You have to do this thousands of times over and over and over. If you do that, customers notice.

bezos2
Amazon chief executive Jeff Bezos. (Image: CNET/CBS Interactive)

Bezos' point with the Fire phone is that Amazon sweated the small things and launched features that with developer help could serve as strong evidence of the company's innovation. Going into the event, I highlighted six questions about the Fire phone effort. Let's revisit those questions and go over what we learned on Wednesday in Seattle:

Can Amazon's smartphone be more than a niche device? Amazon's channel and sales promotion means that the Fire phone can do well. However, I wouldn't be the first in to buy the Fire phone. Why? I need time to get used to the dynamic perspective technology and Amazon didn't dangle much on the pricing front to entice me. Amazon can grab share, but look for the Fire phone momentum to build over time. There's also a learning curve since 3D effects will take time to get used to. You'll either love or hate it. I wonder about how much training AT&T reps can give to close a sale. Amazon has done a few innovative things, but you'd need to spend a few days with the phone to really gauge if it was for you. 

Will Amazon walk that line between walled garden helpful and handcuffing customers? Firefly is the technology that most epitomizes the Amazon approach. Firefly is Shazam for everything and can surface Amazon's vast treasure trove of data as well as prod you to take action. Rest assured that one key action will be to buy something. Since Amazon's Fire phone is really built for Prime subscribers — newbies even get 12 months of Prime included — the company can make its world enjoyable for customers while making impulse purchases friction free.

Fire's success depends on developers

Hardware specs: Quality parts

Is there telecom business model innovation? The biggest disappointment of Wednesday's launch was that Amazon followed the typical smartphone model and, to make matters worse, went with an exclusive deal with AT&T.

Amazon could have included 1GB of data with a Prime subscription. The phone could have been less than $199 with a two-year contract and further subsidized by advertising or content sales. Amazon's approach with AT&T was plain vanilla. The model with the Fire phone is a missed opportunity. 

Rob Williams, vice president of software at Amazon, said that AT&T was a key development partner. "When bringing your first phone to market need to work deeply with a carrier partner," said Williams. 

firefly pricing

How does a smartphone really boost Prime subscriptions, e-commerce and customer engagement? The Fire phone is really an engagement device. There's no question that the Fire phone will drive engagement, sales and customer service. Little additions like the Mayday button will differentiate the device. My hunch is that the Fire phone will be a Prime subscriber's dream.

Does 3D sell? The science behind dynamic perspective is impressive, but color me a tad skeptical. For pictures, Amazon's 3D efforts will be fun. Mapping is also interesting. Other categories are more dicey. The linchpin to Amazon's dynamic perspective will be developers. If developers take the 3D ball and run with it, Amazon has technology that other smartphone vendors will struggle to match. To me, it's a coin flip whether Amazon's dynamic perspective technology is a differentiator or gimmick.

Can Amazon's ecosystem, hardware approach and applications make it a No. 3 platform? One surprise in the Fire phone event was that Bezos was talking to developers as much as he was customers. Dynamic perspective and Firefly both have software development kits. What's interesting here is that Amazon's technology is custom to its Fire phone because of the sensors required. Technically, the new Fire features don't utilize Android, but Williams said any current developer will be able to easily add dynamic perspective and Firefly hooks. 

Simply put, developers will have to bet on Amazon and its ecosystem. Amazon has one part of the equation right: Developers win the day.

It's possible that Amazon could catch up to Windows Phone in terms of applications, but the company will need more distribution to effectively gain share. The exclusive deal with AT&T limits Amazon's advance for now. It's not a big stretch to see Amazon in five years as a No. 3 player behind Apple and Android.

Expect a big Seattle-area rivalry between Amazon and Microsoft on the mobility front.

Topics: Mobility, Amazon, Smartphones

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47 comments
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  • Not hard to catch up to WPs...

    After all, they have all the Nook applications to start with.

    True, some work is needed to handle the smaller display, and due to that some may not make the transition, but there is quite a stockpile to start with.
    jessepollard
  • Not hard to catch up to WPs...

    After all they have the Nook applications as a stockpile.

    True, some modifications will be needed to adjust for the smaller display, and some may not be able to make the transition.
    jessepollard
    • drat.

      too bad there isn't a delete (or an edit).
      jessepollard
  • More Control Being Saught By Amazon

    I will never use or buy an Amazon phone, as it most likely has a backdoor in it just as the Kindle does. The Amazon phone will be good for people who like to be controlled by big corporation, who will determine what and what not should be on their device. It also will suffice for people who don't want any privacy.

    And to top it off, it's going to compete with Android. I see a very small market for this dud.

    http://www.defectivebydesign.org/node/2250
    Stilbe
    • "for people who like to be controlled by big corporation"

      Apples been making Billions from that group of people.

      Any wonder MS and Amazon took notice of that fact.

      If a company approach (closed ecosystem) makes them billions, why would you NOT expect other companies to consider a move towards that same approach?

      Don't blame Amazon for this move, blame the people who gladly joined Apples Ecosystem and waited in line to purchase each reiteration of the IPhone as it was released.

      You have think outside of Amazon to see where this strategy evolved IMO.
      GotThumbs
      • RE

        "Don't blame Amazon for this move"

        Following precedent is NOT acceptable. Half of the population can barely tie their shoe laces, and yes, it's up to companies and other informed people to see to it that less intelligent people's rights and privacy are not violated. Obviously you have a pro-Amazon slant, and everybody knows that companies have hired shills that troll around the internet writing fake reviews and fake comments.

        For instance, you cannot trust reviews on Amazon.com because a large majority of them are outright fake. The internet is a lot of smoke and mirrors, and it's unfortunate that the people who cannot tie their shoe laces see this. The Amazon phone is a backdoored piece of shit.
        Stilbe
        • Am I understanding the point of your argument?

          1. Half the population are ignorant fools.
          2. They need to be protected from making dumb decisions.
          3. Biased review systems (all) should be ignored instead of used to expose recurrent problems.

          If that's the proposal, I'm not buying it.
          SlimSam
          • Obviously

            You've never seen a Bell Curve or read the book by Richard J. Herrnstein. I suggest you Bing it.
            Stilbe
          • Amusing Fact Here!

            I find it funny how when people bash on the mass majority for being "sheep" "dumb" and "ignorant" "Puppets for corporations", and yet bring up the topic of themselves being influenced by others' works and concepts. How paradoxical.
            Nyankana
        • Paranoid rant

          @Stilbe : Although it sometimes seems hard to do, you underestimate the average person's intelligence. If you don't want to use Amazon, nobody is forcing you to.

          Do you have any evidence to support your statement "you cannot trust reviews on Amazon.com because a large majority of them are outright fake"?

          Take a look at this article: http://www.thewire.com/technology/2013/07/truth-about-fake-online-reviews/67189/

          "While 5 percent of the reviews came from customers who hadn't purchased the item in question and fall into the "fake" category, 95 percent of the 325,869 sample were genuine—and not all of them glowing."
          S_Deemer
          • RE:

            Anyone with half a brain knows that a myriad of online reviews are fake, and no, I'm not going to waste my time reading Wired -- for all we know they got paid off to write an article which lists phony statistics. That's not proof. You have to think of big corporations trying to protect their assets, and we all know that corporations lie, cheat, steal, and even have murdered people.

            And you sit here and point to some article on wired as your proof? Please...
            Stilbe
          • "And you sit here and point to some article on wired as your proof?"

            and yet you offer no proof at all.
            just phrases like "large majority" and "myriad"
            at least you are consistent though.
            ;-)
            thekman58
        • Reviews on Amazon fake? Are you kidding me?

          Did you even bother to READ the usual reviews on Amazon? We all purchase things on there and report the result, thus saving a lot of other folks time and angst. Fully half of the reviews are bad, and 80% of my own purchasing decision is based on reviews for that reason. I too often write bad reviews, to help other customers avoid bad products.

          You must be spectacularly uninformed, or are yourself fake, since clearly you've not actually READ the reviews, nor do you realize that Amazon is but a retailer offering products sold by OTHERS 'under one roof', collecting a commission off sales. Apart from Amazon Basics, it doesn't make anything it sells.

          Shame on you.
          brainout
        • not my job

          You're right that (at least) 1/2 of the population are dumb as a bag of rocks, but your WRONG that it's my obligation to protect them. My obligation ends with not violating their rights myself.
          ken@...
        • Amazon is evil because...

          According to you, all of their devices are backdoored and Amazon tells you what you can and can't do with it. This as opposed to Apple, Google, and Microsoft, who of course are all willing to give the user complete control and privacy. Under what shell have you been living? It's not about user privacy or control any more; it's about which of the big companies have demonstrated that they respect their customers more. When one looks at it from that perspective, Amazon is certainly no worse and probably even a bit better than the other big players.

          Insofar as it being a company's duty to see that rights are not viloated...how do you arrive at that conclusion? The end customer should be the one responsible for his or her own privacy decisions; again, which company deserves how much trust?

          By the way, on the subject of the population being unable to tie their shoelaces, here's a video you may find helpful with that task:
          http://www.youtube.com/watch?v=LsFKxElIr_A
          Iman Oldgeek
      • ...

        It's amazing how Apple haters find a way in their twisted little minds to blame them for everything. Amazon is greedy and demonstrated this A LOT recently in relation to their publisher disputes, so it's Apple's fault? Yeah, okay.
        waltwigglesworth
    • "for people who like to be controlled by big corporation"

      You make it sound as if it's a bad thing. Big corporations have helped shape the modern world and improve our lives for the better.

      We, the majority, want stuff and the big corporations give us stuff. It's a win win.
      winGeek
    • @Stilbe, re: More Control by Big Corporations

      As one clone to another, bring on the Clone Wars!!! Apple, Google, Microsoft, B&N, Amazon, Verizon, AT&T. Whose clone do you want to be? You must choose a side. :-)
      BenAround
    • Comment doesn't make any sense

      If you value privacy so much get off the internet. Every click is being tracked by someone whether you want it or not, whether you like it or not.
      Maha888
  • Biggest problem? Timing

    I happen to be in the market for my next AT&T phone, I am exactly what they are looking for. I saw these articles, and went right to the AT&T website where......

    Nothing. the Rep told me they should be out by the end of summer. WTF? Why have this big announcement then not be able to capitalize on the buzz? I will have a new phone before the end of summer, and it looks like it won't be an Amazon phone.
    vermonter