Amazon's Kindle smartphone shakes up the iOS/Android duopoly

Amazon's Kindle smartphone shakes up the iOS/Android duopoly

Summary: So far it doesn't look like there's room for a third wheel in the smartphone arena. The once iconic BlackBerry has withered on the vine, while Microsoft's Windows Phone is suffering from a distinct failure to launch, but Amazon's different approach to hardware gives it a real chance.

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TOPICS: Mobility, Amazon
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Rumors are circulating that Amazon is getting ready to unveil a smartphone addition to its Kindle lineup. But is there room for a third wheel in the smartphone space, and if there is, who's more at risk from that; Apple's iOS or Google's Android.

See also: Amazon's Fire Phone hardware specification  

The mobile space is currently dominated by iOS and Android. The former pulls in the biggest profits while the latter has the best sales, and between them command 95 percent of smartphone shipments. But if rumors are true, Amazon is getting ready to wade into that space with a new Kindle smartphone (Kindle Phone? Kindle Fire Phone?).

I'll leave the rumormongering and mock-ups to others, and focus more on the effect that this handset could have on the ecosystem.

So far it doesn't look like there's room for a third wheel in the smartphone arena. The once iconic BlackBerry has withered on the vine, while Microsoft's Windows Phone is suffering from a distinct failure to launch, despite teaming up with Nokia (although some might question the logic of Microsoft acquiring a company that was already floundering in the smartphone space).

And make no mistake about it, if Amazon enters this market, it will be a third wheel, because while the smartphone's operating system will undoubtedly be a fork of Android, and will have as much in common with that operating system as the platform driving the Kindle Fire tablets has. Not only will is sport a custom user interface, but it will revolve around the Amazon ecosystem as opposed to Google's.

Amazon has a lot on its side when it comes to being disruptive in the consumer electronics arena. Not only does it have a vast ecosystem of content all in place, and countless millions of customers, it's also a company willing to forego making a profit on the hardware in favor of taking a longer-term view. Amazon's hardware is usually competitively priced but innovative and packed with features. And with the Kindle Fire HDX Amazon has shown that it isn't shy about making a move on the enterprise and BYOD sectors too.

But Amazon also has steep challenges to face. The first is that as a single retailer it will have to shift tens of millions of handsets in order to make a dent in either the iOS or Android ecosystem. If we just look at Android alone, there are now over 1.5 million devices being activated daily. Then let's not forget that the Android ecosystem is dominated by a single player – Samsung. I've lost count of the myriad of tablets and smartphones this company currently has on offer. And it's a company that has a reputation for making good products.

Then, in the other corner is Apple. It might only have the iPhone and iPad lines, but it is a heavyweight fighter and there doesn't seem to be any sign of the shine searing off its products, with both lines selling well. And with new products coming out on a regular basis – along with high-profile keynotes and release events – I can't see Apple having much to worry about for the foreseeable future.

A market segment that is open for Amazon is the cheap end of the market. We're talking the sub-$200 market, perhaps even sub-$150. It's not a profitable market, but as we've already ascertained, this isn't something that worries Amazon. It's more interested in using the platform to sell other things to its customers.

It's also worth noting that Amazon doesn't disclose Kindle hardware sales, perhaps the best indication that shipments aren't the metric the company wants us to focus on.

So, can Amazon's Kindle smartphone shake up the iOS/Android duopoly? Maybe, but it won't be a shake-up in the traditional sense in that it will erode iOS or Android market share, but instead it will add to the standalone ecosystem that Amazon has created with the Kindle hardware. Kindle is a platform that Amazon uses to get people to spend more money on other Amazon products and services, and in this way it is a pretty unique business model. And to me, given the clout that iOS and Android has over the market, it may very well be the only way a third player can gain traction in the market. Taking the direct approach hasn't worked well for those who have taken it.

But the longevity of the Kindle line – going all the way back to the original ebook readers – proves that the world's biggest online retailer is prepared to stick it out.

See also:

Topics: Mobility, Amazon

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28 comments
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  • Amazon's Kindle smartphone shakes up the iOS/Android duopoly

    "while Microsoft's Windows Phone is suffering from a distinct failure to launch"
    I'll just assume you make up lies as you go along. Year over year growth. One of the most intuitive platforms, groundbreaking UI.

    Amazon kindle fire phone will be the failure to launch. If iOS, android, and Microsoft Windows Phone make up the three wheels then the amazon phone will be that can that is tied by a string to the bumper. Its running android and has nothing to separate itself from the hundreds of other android devices. People are actually getting fed up with android based on the comments that I hear daily. App freezes, slow OS, and random reboots are turning people away. If Amazon does decide to go into making cellphones they will lose a lot of money on the deal.
    Loverock.Davidson
    • Silly Loverock ...

      ... this is the Real World, not children's TV!!

      Amazon WILL take off, and will likely outsell Windows within a year. Too restrictive for me, and it's a mature market ... but the price will be low enough to take a share. With tablets, Amazon have been happy to break-even, knowing that profits will come via locked-in custoners (and they have - simple fact).

      A similar argument applies here. Granted, some will be new buyers, who have had a mobile phone but not a smart phone (there's a difference - tell Farell); but other will come from Android, traditionally at the lower end, and also from Windows, as Microsoft cut their subsidies (which they will). I doubt Apple will be hit hard by this, but they'll continue to slide slowly as Samsung and others improve their top-end phones.

      OK, Loverock - back to the Childrens TV ...
      Heenan73
    • Windows phone is a dud.

      For all the PC users out there, the Windows Phone is a dud. I wouldn't touch it and I have played with the Lumina. What a dog. Anyway, this chart says it all about the different OS's out there:

      http://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&docid=-FYTyf3Jxn3RKM&tbnid=K7PzDvKxsi6ZIM:&ved=0CAUQjRw&url=http%3A%2F%2Fwww.theguardian.com%2Ftechnology%2F2014%2Fjan%2F09%2Fmarket-share-smartphones-iphone-android-windows&ei=TZqgU9_gM4OQqAajk4CoBQ&bvm=bv.68911936,d.b2k&psig=AFQjCNEpHAPwiIsBlKbG5Ba96nLMLVBP9w&ust=1403120587922150
      johnbarryegan@...
      • Are you kidding me?!

        Windows Phone has brought new technology and a fresh new interface to the mobile market! People always comment how responsive and quick the UI is.

        You may not like it, but a dud it is not! I've used it since WP7 and it out performs any thing out there. Windows Phone is gaining traction and is becoming a great contender in the market place. You want something that works? Windows Phone. Period.
        jediman98
        • Oh puhlees

          I'm writing this with my Lumia 920 sitting on its Qi wireless charger right next to me. It is my second Windows Phone after my Arrive, which I bought launch week on Sprint. I have been a pure WP user for almost four years.

          And let me be the first to admit, it's a total dud. Virtually every app is missing features or, often, altogether. That includes MS' own properties, by the way (Skype is a disaster on WP). The OS itself is horribly crippled by the terrible browser that is IE, the terrible email client, the totally borked multitasking, etc. Live tiles were a good idea once but have not lived up to their potential in any way, shape or form (compare them to widgets on Android to see what they should have been). And, as much as I think metro is an elegant, highly usable and highly desirable interface, the simple fact of the matter is most people (rightly or wrongly) have shunned it. Everything it has touched has been a flop, from WP to W8 to XBone.

          I may even stick with WP in the future only because I consider Google to be a spyware company and I don't like paying the Apple premium (plus all Apple products, software and hardware, are horribly, horribly ugly). But I won't make any false claims about the suitability of WP. It is a non-player at present, and unless MS makes some serious moves, it always will be. The state of WP is sad, sad, sad.
          x I'm tc
          • well, you can hold out hope for tizen, firefox OS, or ubuntu phone

            perhaps!?!
            drwong
          • WP8.1 FTW

            You've obviously been using WP8, which is indeed a dud. WP8.1 fixes almost all of its predecessor's shortfalls and does it with elegance; bringing the OS on par with iOS and Android. Sent from my Nokia Lumia 1520 running WP8.1 DP.
            davidpbj
        • another Oh puhlees from me

          Look, Im not out to bash windows phone - the more competition the better. But all I hear are comments about how responsive it is - but basically because it doesn't really have anything else to do except focus its full CPU/GPU on transitions!
          You read any review and they state to this day how behind windows phone OS still is. You are obviously a shill or with some financial incentive in MS.
          drwong
        • another Oh puhlees from me

          Look, Im not out to bash windows phone - the more competition the better. But all I hear are comments about how responsive it is - but basically because it doesn't really have anything else to do except focus its full CPU/GPU on transitions!
          You read any review and they state to this day how behind windows phone OS still is. You are obviously a shill or with some financial incentive in MS.
          drwong
      • I didn't go to the link

        Saw it was a Google based URL so I won't open it.
        Loverock.Davidson
    • Loverock HAS to be joking

      Microsoft? You are declaring success?

      They've failed in spectacular form - I'd argue they've made more mistakes than Blackberry, and it's amazing they've suffered less - you can't even argue "year after year growth" - they haven't even picked up marketshare percentage as fast as Blackberry has lost it. Their "year after year growth" is NOT with respect to marketshare percentage, which is what really matters. If you are growing less than the overall smartphone marketspace, you're failing.

      Bottom line is - developers STILL aren't developing for Windows Phone. Because users STILL represent such a statistically insignificant percentage of the overall marketshare.

      If you want a trip back in history to what I refer to as "Microsoft's big screw-up" - well actually there are two - let's visit the first REAL important one - the launch of the iPad.

      Back then, it was the Stigma of Windows (bluescreens, crashy, freezy, slowdowns, popups, confusion, the feeling that you needed an MCSE in the family to support your home PC) that led to over 10 years of "Windows on a tablet" failing - AND to the WILD success of the intentionally stripped-down, simple, "it just works" casual-user iPad.
      Apple can thank MS for that gift.
      And having a complimentary tablet to their iPhone helped bring users into their ecosystem, and the purchase of one leads paves the path to the purchase of the other. Logical.

      And that brings us to mistake #2 - the big one, with regard to Windows Phone.
      Microsoft completely didn't (and doesn't) understand the mobile paradigm. That's basically the current state of the mobile marketspace - it's what features and functions people are currently voting with their wallets on.

      Just as people were:
      a) complaining that iOS was too restrictive, and Android too confusing, and
      b) were buying complimentary phones and tablets (Android or iOS, specifically)
      ...that's when Microsoft had (key word) the golden opportunity to come up right between the two.

      Microsoft announced they were trashing WM6.5, and would be launching something all new to compete with Android and iOS.
      I thought for sure, it would be great. A completely rewritten mobile OS with a full line of phones and tablets, and what better hardware partner could you possibly have than Nokia.

      And Microsoft completely blew it.
      They announced "Windows Phone 7!" ...meaning no tablets - despite what people were voting with their wallets on, and the failure of the past 10 years stigma-of-Windows tablets, they want to sell us 'Windows-on-a-tablet' again. And OF COURSE it failed (and in a way that impacted Microsoft stock following that announcement like no other in Microsoft history).
      Even today, you STILL can't get a Windows Phone (I suppose they'd have to rename back to "Windows Mobile", wouldn't they?) tablet - despite the mobile paradigm being one of people buying complimentary Android and iOS phones and tablets.

      And that Windows Stigma? Do you think it was helped by stretching that wonderful Metro interface across a desktop OS?

      Then, Microsoft decided to abandon all the early adopters on an island. "You won't be able to update past WP7.8 - sorry!" Brilliant move to really keep those raving fans.

      Apple and Google have to be absolutely rolling on the ground laughing at what could have (should have) been their biggest threat literally tripping over their own feet, because they've tied their own shoelaces together.

      It's pure silliness to state that Microsoft is succeeding in mobile.
      Oh that's right - they don't have a mobile OS. In phones, then. Which ecosystem is that, again?
      See the problems yet?
      geolemon
      • Too long, didn't read

        Although I did catch the last line "See the problems yet?" and I'm going to answer with no since there are no problems.
        Loverock.Davidson
  • Is it really disrupting the duolopy when it uses one of those OS's?

    You admit yourself it's a forked version of Android so while it may replace Google Services for Amazon's, it's still part of the Android tree as opposed to being something different. Hopefully BlackBerry and Microsoft can find some kind of traction to at least give us some kind of real choice between Apple and Google.

    And to keep the fanboys at bay, all four operating systems are compelling in their own ways, but what good did limiting our choices to just two providers in any field ever do?
    SalSte
    • To an extent

      If Amazon's new Kindle phones are Android based, they would be like the new Android-based Nokia phones: based on Android, but not using Google services. That may well be differentiation enough.
      John L. Ries
      • AndroidGoogle

        An android phone works without google services. In fact, google apps are not open source nor freely distributible nor included in AOSP builds. Amazon devices are Android. They run android apks. BB is almost Android compatible now too. Assimilated I guess.

        The thing is, 80% of people prefer an open OS like Android. It is bad enough that carriers and manufacturers lock bootloaders and such but people won't take kindly to not being able to load the google play store on their Amazon device for more options. Nook learned the hard way.

        Amazon will not be able to undercut anything. Carriers such as Republic and Straight Talk already offer very inexpensive Android phones. Even some iPhones are free on contract. The price scale is covered all the way up to the double quad core devices in Android as well.

        Offering "less" is a difficult road that Apple has been plying but they've been adding functionality sorely missing and iOS8 may offer a file system long over due in the form of it's cloud.
        LarsDennert
        • Amazon can run Google apps just fine. 1Mobile has 800,000+ for download.

          Many Android users may not realize that the common Android setting to "allow install of apps from unknown sources" is a simple setting Kindle Fire tablet users can enable.

          Google Play's apps are distributed by others too, and 1mobile has over 800,000 of them and (unlike Google) they allow Kindle Fire tablets to download them direct and just run them.

          I have Google Earth, Google Maps, Google Voice/Search on my Kindle Fire HD and HDX with NO rooting or modifications necessary. You just check a settings box to allow the installation of apps from 'unknown sources' meaning NOT Amazon store. Amazon allows this setting.
          -- Barnes and Noble didn't and so they lost out and wound up letting Google have take over as main store for music and apps. Amazon wouldn't likely cotton to those terms (and wouldn't need to).

          It's very easy to do but most people just don't know, and that's because most people don't explore. There are many online sites that show how easy it is. But writers on the larger tech sites with so much to report on tend to carry on the myth that you can't run Google apps on the Kindle Fires and that Amazon doesn't allow it or is 'walled.'

          My own step-by-step guide is at http://kindleworld.blogspot.com/2012/11/the-reviewer-myth-that-kindle-fire.html

          We direct-download to tablet, install in place and run. The 1mobile store is handled just the way any appstore is -- Search, click to download, install and run. No 'side' loading.
          andrys1
    • Market Share

      Since Amazon's Kindle Fire numbers are normally lumped in with Android market share - you have a very good point. It is Android with a new skin and locked down so you cannot access the Google Play store.
      monteith
  • Sick of app games

    You can't even watch Prime tv/movies on android or windows phones, playing games not making apps isn't good business(that mean you google also(no real google apps on ms) and microsoft(no xbox video on android).
    everss02
  • Rumor mongering vs sheer speculation

    You are leaving the rumor mongering to others while speculating wildly about the effect of a rumored phone on the marketplace? Is this truly different?

    Amazon has the means to make a competitive device but its previous approaches are based on a forked version of Android. This doesn't create the best devcie experience though it serves Amazon's purposes well.
    buzzkill44
  • Kindle uses the Android OS already

    Kindle uses the Android OS already, so this entire article is obviously written by someone who's never used a kindle.

    Entire article == MOOT

    Seriously - get your act together here.
    KindleUser