Is Amazon Set to Go After Apple in the Mobile Space?

Is Amazon Set to Go After Apple in the Mobile Space?

Summary: While competitors are scratching their heads trying to figure out how to give Apple a run in mobile, Amazon, a company not seriously competing with Cupertino, could become a major threat, and easily.

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TOPICS: Apple, Amazon, Mobility
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Steve Jobs and Apple have been sitting on comfort street given the company's dominance in the mobile space. While competitors are scratching their heads trying to figure out how to give Apple a run in mobile, Amazon, a company not seriously competing with Cupertino, could become a major threat, and easily.

The success of the iPod, iPhone and now the iPad have pushed Apple firmly into the mobile space. While Android is making a historic run against Apple in the smartphone platform war, Apple is still on top of the mobile heap, and has reached it with just a few products. Jobs and Apple are definitely the forces to be reckoned with, and I believe Amazon is the company in a good position to do take it right to them.

Infrastructure and Ecosystem

Apple used the iTunes ecosystem to drive sales of its mobile gadgets, a strategy that has been successful. Customers get locked in to the content sales system for music, video, apps and now ebooks. This ecosystem stands in the way of those trying to compete with Apple in mobile, as it makes the cost of entry quite significant for most companies. Competitors need a music store, video store, app store and ebook store to challenge Apple's dominance.

Amazon has one thing that Apple lacks, a massive global retail infrastructure. It is already in place, and a big leg up for an Amazon entry into mobile. The Amazon MP3 store is already operating and competing with the iTunes store. Amazon offers video-on-demand (VOD) commercially, and the Kindle bookstore may be the biggest ebook retailer in the world. All that is missing is an Amazon app store, and that was just kicked off by the company. To break into the mobile space in a big way Amazon needs to seamlessly bring all of these online retail operations into one entity.

The company already makes its own gadgetry with the Kindle line of ereaders. What if they carry that experience forward and produce a full-fledged tablet? That's the hot area in the mobile space currently, as witnessed by all the tablet activity at the CES this week. An Amazon tablet could be produced running Google's Android platform, which is an easy (and cheap) entry into the mobile arena. It could be a Kindle branded tablet, but if it was up to me I'd go with a simple Amazon Tablet brand. There are already Android apps for the MP3 and Kindle stores, so those could be preinstalled on the Amazon Tablet. The key is the tablet wouldn't just be used for consuming Amazon content, it would facilitate buying it, and that's Amazon's core business.

An Amazon Tablet could instantly put the company in direct competition with Apple in mobile, but Apple does have the iTunes application. Sure, iTunes has become a bloated piece of programming that often infuriates users, but it still makes the mobile experience relatively seamless for Apple customers owning mobile devices. Amazon would need a desktop client to make its Tablet compete, and there's an easy way to get one.

All Amazon would have to do is buy the doubleTwist Corp., producer of the doubleTwist app for Android and other platforms. DoubleTwist is essentially iTunes for Android in its current form, and could handle the Amazon Tablet from day one. The program already integrates Android devices with the Amazon MP3 store and the Android Market, all Amazon would have to add is conduits into the VOD and Kindle operation. Or perhaps it makes sense to leave the Kindle stuff as it is, already handled well by the Android Kindle app. The point is producing a tablet and acquiring doubleTwist would give Amazon an instant end-to-end ecosystem in the mobile space. This would be instant competition for Apple, and formidable competition at that.

Amazon has been rumored for a while to be working on a tablet, so this is not just a product of my fervent imagination. The company launching its own app store makes sense when taken in this context, doesn't it? As magical as Apple may be, it would make the world much more interesting if giant Amazon fired a Tablet across Apple's bow.

Topics: Apple, Amazon, Mobility

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  • RE: Is Amazon Set to Go After Apple in the Mobile Space?

    "Amazon has one thing that Apple lacks, a massive global retail infrastructure."

    Really???
    computerchipt
    • RE: Is Amazon Set to Go After Apple in the Mobile Space?

      @computerchipt Fair point, but Amazon's is simply huge by anyone's standards.
      JamesKendrick
  • Very interesting how words are used to apologize for actions

    [i]Apple used the iTunes ecosystem to drive sales of its mobile gadgets[/i]

    No, a more accurate statement would be:
    [i]Apple [b]leveraged[/b] its iTMS monopoly to drive sales of its mobile gadgets[/i]

    Something that is highly illegal.
    NonZealot
    • So true

      @NonZealot

      Too bad Apple hasn't allowed Zune or Android or Emusic or Rhapsody or Napster or Bandcamp or Audimated or iMesh or Juno or Magnatune or Playnow or Rhino or Walmart or Amazon or hundreds of other sources for media to sell it's own. If only these places existed....
      Tigertank
      • So true

        @Tigertank
        Too bad MS hasn't allowed Apple to sell OS X. If only that OS existed...
        NonZealot
      • Thank you court jester! You may retire to your hole now

        @NZ

        Microsoft has allowed Apple to sell OSX. WHO here in this discussion suggested that Microsoft hasn't allowed Apple to sell OSX? cause I can't find it.

        I love how altruistic you are in willing to make yourself play the fool for our continued amusement. Do a little dance NZ. shake your little bells.
        Tigertank
      • Ah yes, not surprising you didn't get it

        @Tigertank
        [i]WHO here in this discussion suggested that Microsoft hasn't allowed Apple to sell OSX?[/i]

        Absolutely no one, and yet MS was still found to have a monopoly. Puts your whole response that Apple can't have a monopoly because Apple hasn't prevented others from "competing" into perspective!!! It should have been obvious that I used your exact response and just replaced Apple with MS and Zune with OS X. I used your argument against you to make you look like the fool. :)
        NonZealot
      • I ignored it.

        @Court Jester

        I can see a good deal of your self esteem is tied up with Microsoft's old monopoly status. You use the same little false logic trick in every single article.
        But you haven't figured out that it doesn't work if no one is making the argument you claim they are. That's why all your comments are non-sequiturs.

        Nobody but you brought up the trial. (Which by the way began over a year before OSX was even released. It had nothing to do with OSX)

        [i] I used your argument against you to make you look like the fool[/i]
        No you created a strawman argument because you were embarrassed that I called you out.

        The dunce cap should match your harlequin suit nicely.
        Tigertank
      • Tigertank

        @Tigertank - I think it's evident, especially if you've read any of NZ's posts from the past, he knows exactly what he's talking about and is no slouch to be sure. I think you know that.
        What you miss is the point of his posts and you may never get it, if you don't open your eyes to the themes of 90% of all other posts on zdnet.com.
        xuniL_z
    • Why do you continue?

      @NonZealot - Just go away until you understand how the world works...
      Gr8Music
    • Microsoft

      @NonZealot but MS did use it's Monopoly to stop a number of companies from competing. Either by destroying their market through free software which posed a threat (Netscape) or by locking other software vendors out through illegal OEM pricing practices (IBM). Maybe you should read up on some of the case files.

      And leveraging a product per-say is not illegal as you suggest. It is only illegal if it stops or locks others out of the market. This is clearly not the case with iTMS and the ipod / iphone.

      Many other companies have made similar products with music software linked to hardware... Sony and Microsoft jump straight to mind but there have been others.

      The fact is consumers didn't pick them for a host of personal reasons. Recent research shows that still the amount of purchases conducted online is very low.

      http://gigaom.com/2010/12/30/65-of-web-users-buy-digital-content-more-music-fewer-e-books/

      So did Apple get some gain from iTMS to help it sell mobile gadgets, of course. Its attractive as an additional feature, just like great hardware, software etc. But it is hardly a monopoly as you suggest.

      If it is a monopoly as you suggest how do you explain the stunning rise of android?

      If iTMS was a monopoly as you suggest people would not be able to switch to this other mobile platform without great pain or cost. Clearly this is not happening.
      David Turner
  • RE: Is Amazon Set to Go After Apple in the Mobile Space?

    We all benefit from Apple - either as their customers, or as the customers of their competitors, who are held to higher standards because of Apple's quality and innovation. (Said from the perspective of someone who's never owned an Apple product).

    Similarly, Amazon's easy-to-use web site, fair pricing, and excellent service make them the gold standard in online retailing. Whether you like them and buy from them or not, you'll benefit from the standard they set.
    1DaveN
    • Amazon Set The Standard For Me

      @DaveN_MVP - They were the first major store that allowed my CC info to be compromised!
      Gr8Music
    • RE: Is Amazon Set to Go After Apple in the Mobile Space?

      @DaveN_MVP Amazon Fair prices? Amazon sucks and is one of the highest priced places to buy items. i cant see how this will work. Amazon opens an android app store so they can double the price of apps from what you can get on the specialized android market and this makes sense to buy from them at highly inflated prices why??
      Fletchguy
  • RE: Is Amazon Set to Go After Apple in the Mobile Space?

    I suspect the author fails to understand that Apple has iTunes web stores in different countries just like Amazon.

    The last time I heard Apple was now aggressively opening their highly desired Apple brick and mortar retail stores in country after country to blockbuster crowds.

    How many global local walk in support centers does Amazon have for the Kindle or future tablet PC?

    Now please try to explain Amazon's imagined advantage again?
    vic.healey@...
    • RE: Is Amazon Set to Go After Apple in the Mobile Space?

      @vic.healey@... Apple is big, no question. But Amazon is a global retailer of millions of items, versus Apple's relatively small product line. Amazon is huge, Apple is big. That's the way it is.
      JamesKendrick
      • RE: Is Amazon Set to Go After Apple in the Mobile Space?

        @JamesKendrick That is true but in the context of your argument it is the in ability to deliver digital content that the advantage lies when discussing capacity to take on the "dominance" of Apple in the mobile space. Here Apple still has the edge. Amazon has the edge for books but does not offer the same level of content for video or music outside US. Hence Apple has the advantage, currently, on delivering content globally. I agree Amazon are well placed and could expand their music and video offerings but would still need to do some catching up.
        Nihon8888
      • RE: Is Amazon Set to Go After Apple in the Mobile Space?

        @JamesKendrick
        You're not addressing @vic.healey's points! How many years have you been doing this? Thirty? Wow!
        Eleutherios
      • RE: Is Amazon Set to Go After Apple in the Mobile Space?

        @JamesKendrick
        "But Amazon is a global retailer of millions of items, versus Apple's relatively small product line. Amazon is huge, Apple is big. That's the way it is."

        This is just simply not an accurate statement.
        First, the issue is not the number of products sold, it is the size of the infrastructure. To claim that Amazon's retail infrastructure dwarfs Apple's is simply wrong. Even without the web being the great equalizer, in terms of actual server horsepower, Apple gives amazon a run for their money. Certainly in terms of unit transactions.
        In addition, the OP's point regarding brick and mortar stores is valid, and yet you dismiss it out of hand, as if the online sales model invalidates the physical retain channel. This position is absurd. Not only do online dollars spent still not come close to physical retail, but in terms of actual hardware sold, the advantage of having access to a physical sales point can not be stressed enough. In both these areas, Apple is at least on par. Combined, it could be easily argued, Apple is the larger one.
        DeusXMachina
    • RE: Is Amazon Set to Go After Apple in the Mobile Space?

      @vic.healey@... Couldn't resist making a comment. I don't understand why people go Ga Ga over everything Apple and continue to rip Microsoft. Which of the two is worse? Apple is highly controlling and restrictive, MS readily encourages third party developments.
      And if you go into an Apple store it is full of kids (teeny boppers). Apple has marketed itself to children because that is the easiest marketing segment to manipulate. Glitz and cuteness do not mean you are getting value. Apple overprices all its products and gets away with it. Apple convinces all these children that if they don't have an i-product they are inferior to their peers.
      We don't need all these gadgets that are being spit out. People are forgetting how to socialize on a face to face basis because they can't live without some kind of toy that connects them electronically with everyone else.
      Enough. Blast me if you wish; but I stick with my comments.
      Romas27