Amazon's smartphone launch: 6 key questions

Amazon's smartphone launch: 6 key questions

Summary: Amazon has a lot of parts that could make a smartphone a success, but questions abound. Here's a look at six big ones.

amazon screen

Amazon is expected to launch a smartphone on Wednesday in Seattle and expectations for the device are fairly low.

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The launch, which will reveal a few goodies such as 3D effects, is Amazon's first entry into the crowded and commoditized smartphone market. Amazon has a lot of parts that could make a smartphone a success, but questions abound.

Here's a look at six questions about Amazon's smartphone. We'll update after the event with the early answers.

1. Can Amazon's smartphone be more than a niche device? Analysts aren't going gaga for what has been leaked so far about Amazon's smartphone. No one is proclaiming Amazon's Kindle phone a real rival to Android devices or Apple. It's unclear whether Amazon's phone can even be No. 3. All of those low expectations are good for Amazon, which can surprise on the upside.

2. Will Amazon walk that line between walled garden helpful and handcuffing customers? Amazon's smartphone will likely be a small screen version of a kiosk for the retailer. The device will be all about Prime content and engagement. Much of my time is spent in Amazon's ecosystem---Prime video and music, storage, Kindle Paperwhite and apps for Kindle---so a phone won't be a big stretch. However, if Amazon goes too far it could suffocate folks in the other ecosystems.

3. Is there telecom business model innovation? Perhaps the best thing Amazon could do is change the economics behind smartphones and two-year carrier plans. Amazon's pricing should be closely watched as well as how it markets the device. AT&T is reportedly a key partner and it's unclear whether there will be pricing model innovation on tap.

4. How does a smartphone really boost Prime subscriptions, e-commerce and customer engagement? Now that Amazon has tablet and smartphone plays there should be better visibility on how a device owner spends time on the site, shops and handles repeat purchases. Ultimately, Amazon should get a better feel for customer acquisition through a device and the returns.

5. Does 3D sell? Amazon's claim to fame for its smartphone is a 3D effect that hasn't been revealed yet. Given the history of 3D it's hard to envision special effects being a real selling point. Amazon's 3D features, which have been leaked to some degree, have already been dismissed as gimmicky. But Amazon could surprise.

6. Can Amazon's ecosystem, hardware approach and applications make it a No. 3 platform? Amazon's Appstore has 240,000 apps, a sum that would put it behind Microsoft's Windows 8 and Windows Phone stores. Microsoft doesn't make a distinction between its two app marketplaces. Amazon has been trumpeting developer economics and monetization and has enough pull---as well as leverage with Android---that it could be No. 3 at some point.

Topics: Mobility, Amazon, Smartphones

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  • Slow News Day?

    If this isn't the proverbial 'Click Bait', nothing is. Why not wait until you have something of interest? A two year old can ask a bunch of stupid questions.
    • You just listed the questions we all have.

      I don't see this selling. The first thing I did when iOS 7 came out was disable the 3-D effects. On a tiny screen, it's just a distracting gimmick that causes additional eyestrain. I would say that, unless they are offering unlimited data at a cheap price, only a small percentage of existing Kindle owners will be considering this device. There just isn't anything compelling in the rumors. Limiting it to AT&T is just another nail in the coffin.
      • Agreed re: ATT

        Not that I have anything against AT&T, per se, but their network doesn't have VZW's reach. Where I live, AT&T has no service at all.

        If Amazon offered a VZW version of the phone, I might be interested, depending on whether it provided enough basic Android functionality to run, for example, my financial institutions' online check deposit software. In fact, I'd welcome a "sanitized" version of Android with even marginal application support it were also free of Google's spyware and incessant surveillance.

  • Ditto

    Why bother writing this article that tells us nothing?
  • I third that notion...

    This does nothing but throw a bone to the rumor beast. Wait until the event is done - there will be plenty of time for asking pointed questions then.
  • Amazon phone

    Partnership with ATT, or any major Telco, will kill the product.
    • Yeah iPhone exclusive on ATT was terrible for iPhone

      How else do you expect them to market it? Like that low profit, low volume Nexus?
      • Not an appropriate comparison

        iPhone was "it" for smartphones (for the most part). As soon as Android hit and there were more good choices on other networks available, they ditched carrier exclusivity with AT&T. Look at the limited distribution of the Motorola Droid line on Verizon (yet Motorola does still have other devices on other carriers). Carrier exclusivity on launch with a flooded and commoditized smartphone market would be stupid.
        • Not true...

          iPhones are more than just an 'it' factor. I was a longtime Android user, still am but I also have an iPhone 5s and the built quality blew everyone else out of the water. The ease of use was one of the main reasons that made me tried out and eventually bought the device. Like I said, easy and user-friendly but when it comes to setup and working on shortcuts, it is as complex as any Android - minus the many steps to get one thing done. I don't love it nor hate it.
  • Amazon Phone

    Exactly why this article was written??
  • Niche device?

    Other than Samsung Galaxy S series and Apple's iphone, every other smart phone is a niche device.
    • It took 6 posts to get to the crux.

      If your name is not Apple or Samsung the mobile handset business is a bust.
      • Re: It took 6 posts to get to the crux.

        ...UNLESS amazon decides to use Android WITH google play. We already know that amazon produces the Kindle fire which runs Android but without the Google Play. IF that's what amazon is going to do, lauch an android powered smartphone with Google Play MISSING, THEN its a bust.

        Your name could be anything, but if your product is running Android with Google Play, and your product is built for quality, super stable, feature packed, very fast and most importantly, the "Planned Obsolescence" department has not had a say regarding the product (the product is very durable, doesn't break just when the warranty expired, etc) then people will like your product.
        • Why would Amazon use Google Play?

          That would be worthless to them. Actually more than worthless. Amazon has a richer content system than play in every thing but sheer App count (but do you need 10,000 hellos world apps. Yep. 10,000?). From books, movies to music content is an Apple/Amazon game.
          • No Maps is a loser

            If you cannot get Google maps on this smartphone, it is a non-starter.
          • There are other maps partners.

            Only the narrow minded think Google maps are the only play in town. MapQuest has far more accurate maps (Google is not keeping up in fast growing areas and StreetView is like looking into a 7 year old time machine in many areas). Nokia Here maps are very competent.
          • Google Maps are not necessarily a selling feature

            I don't agree that No Google Maps is a non-starter for everyone. Google maps has become bulky, slow, unintuitive, aggravating, and inaccurate (for traffic and for services). I'd be happy to try a competing map service.
  • Better question to ask.

    A better question to ask is Who Cares?
    Like everything amazon, it will be a low end device with a horrible user experience. Any amazon product is designed only to get consumers to buy more overpriced items on amazon.
    Amazon cannot offer product which will better the iPhone 5 s, the Samsung galaxy or the excellent windows Phone.
    There are so many vendors who mow offer better pricing and service than amazon. Just search the internet form the next item you want to buy. You'll see that amazon is always the most expensive vendor. Best buy, home depot, Walmart, Kmart, toys r us and eBay have better pricing. Most vendors offer free shipping.... for free so why would I pay amazon for the privilege.
    Amazon will need much more than a phone to stay relevant with superior competition popping up everywhere. The intelligent consumers are shopping around and saving thousands by not shopping amazon.
    • Alibaba

      Not to mention the world's largest online portal Alibaba is coming - first, an IPO, then they will launch on all corners. This will be a real threat to Amazon. Let see how long they can keep their arrogance.
      • ....

        Alibaba has some real issues though. Im not a big Amazon fan as they are over priced on pretty much everything but I have used Alibaba over the last 5 plus years and they can't weed out the scammers and con artists which is about 60% of its users. They have to find a holding or escrow company as usually they have you wire transfer money and you dont get goods. Lots of the countries they have sellers from can t take credit cards, bank checks, or paypal so without a complete redesign alibaba has way too many issues to be mainstream.