Can't start a Fire without a spark: Why Amazon is dancing in the dark

How Jeff Bezos failed to disrupt smartphones, disorient carriers, or destroy the iPhone.
Written by Jason Perlow, Senior Contributing Writer
Image: ZDNet/CBS Interactive

On Wednesday of this week, with high expectations and great fanfare, Amazon launched its Fire Phone.

There's been a lot of coverage of the device from a technical innovation perspective and how it positions itself against competing offerings from the Android device manufacturers and Apple's iPhone. I'm not going to revisit that because I think that ground has been covered ad nauseam.

There's no question that the Fire Phone is a strong product offering, in the sense that it offers technological differentiation from its competitors while at the same time is at "spec parity" with most of the high-end Android devices on the market, such as Samsung's Galaxy S5.

However, what the Fire Phone and Amazon failed to do with this launch was to actually disrupt, which is what one would expect of a new player in the mobile space and Jeff Bezos's track record with new consumer electronics products as a whole.

Let me invoke my inner Springsteen: Jeff Bezos tried to "start a Fire without a spark."

Other writers and analysts have pointed out that perhaps having AT&T as the sole carrier at launch and not going with a more of an "uncarrier" or contract cutting voice/data model may also hurt adoption of the device. Maybe T-Mobile might have been a better choice in this regard.

But in terms of being able to fundamentally change the way people purchase wireless data today across carriers, I'm not entirely sure this is something even Amazon would have had sufficient leverage with.

I'm being realistic here that the wireless industry in the United States is such a wretched hive of scum and villainy that nobody is going to be able to fix it without significant government intervention. So on that front, I'm going to let Bezos off the hook.

The 3D dynamic perspective/stereopsis display tech is certainly interesting and it may create some compelling consumer applications (particularly games) in the future.

Had this been a "perk" (like its Mayday feature) and not a defining feature it would be one thing, but it's actually being positioned as the prime differentiator between competing Android devices and the iPhone.

It's hard to justify a product purchase on a feature that is not currently exploited by existing Android applications right now. And as ZDNet's editor-in-chief Larry Dignan notes, it's all up to the developers to determine whether or not the investment is worth it to add those features to their Android applications just for Amazon's devices. 

Its taken three years alone just for Amazon to populate its Appstore with the most popular Android apps, let alone ones that specifically would take advantage of Dynamic Perspective. And Amazon's store is far from comprehensive, as not every Android developer is on board.

"I also fail to understand how this product is fundamentally better than other smartphones on the market for the company's loyal Prime customers, for who this phone is essentially targeted to."

Firefly, the advanced product recognition technology, which is essentially the number two most hawked feature of the device, is also not necessarily a differentiator.

The tech could have been offered in the Google Play Store as its Amazon application is now, which currently has barcode recognition technology in it. And the SDK with associated libraries needed to extend existing Android apps with the Firefly APIs could have been packaged with it, although I'm not sure how that would impact the Google developer agreement.

A dedicated Firefly app could also have been ported to iOS, although Apple would have certainly wanted its 30 percent cut on in-app purchases had Amazon done so. Amazon does this with its existing iOS store app already.

In other words, if the objective was to drive as much commerce to Amazon as possible with smartphones using Firefly, they didn't need to launch a new device in order to do it, they already had hundreds of millions of existing smartphones in the wild to put it on.

Knowing Amazon, this is probably already in the cards in the future. So I wouldn't count on Firefly exclusivity with the Fire Phone.

But the Dynamic Perspective and Firefly being marketed as the prime differentiators are not the core issue here — the phone itself is coming out the gate at the same price point as premium Android devices and the iPhone, at $199 in the least expensive configuration. 

To me, this was the primary failure in the product's launch, to not disrupt on pricing.

Amazon was able to make a big impact with the initial Kindle Fire launch by providing more bang for the buck with its 7-inch Android tablet than their competitors' and setting the new price point for that form factor at $199. 

Instead, Amazon went with a bill of materials in the Fire Phone, which prohibited it from being sold at a lower price point. Yes, the four stereoptic sensors are nice, but they probably contributed $25-$30 to the bill of materials.

It's also probably worth mentioning that the 3D stuff is going to be much more compelling on a contract-free, Wi-Fi next-generation Kindle Fire 7-inch or 8.9-inch HDX, where the larger display is going to be far more exploitative of the stereopsis effect.

Additionally, not offering a 16GB version of the phone and leveraging more of Amazon S3 for application data storage and restricting it strictly to photos was also was a big mistake.

They really could have positioned the power of its cloud with this device, and in that, I also regard as a fail.

A non-3D, 16GB Fire Phone could have been a disruptor at $99 or less. This counts as a big missed opportunity in my opinion.

I also fail to understand how this product is fundamentally better than other smartphones on the market for the company's loyal Prime customers, for who this phone is essentially targeted to.

The phone could have been made cheaper for existing Primes, or perhaps some complimentary data perks or Appstore credit could have been added. The free year of Prime that comes with the device is nice, but I don't see how that is enough of a carrot for a device that one needs to live with for two years under a wireless contract.

The new Amazon Music perks for Prime apply to all Prime customers on all platforms, so the Fire Phone isn't offering anything better that Primes don't already have now on their Androids and iOS devices.

Maybe I'm missing something, but while the Amazon Fire Phone is a nice device, I don't view it as an industry disruptor like the Kindle Fire was. Do you agree? Talk Back and Let Me Know.

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