Amazon Smartphone Announcement - Our Opinion

by Tejas Mehta | Jun. 19, 2014

Yesterday’s much anticipated launch of Amazon’s first smartphone named “Fire,” lived up to its pre-launch hype in many ways. The event showcased a smartphone with an impressive array of features and technology. How well these features work in practice remains to be seen, but it is a bold attempt by Amazon to make its first smartphone hold its own against some stiff competition at the higher end of the smartphone market.

While many of the features are not surprising, and, in my opinion, Dynamic Perspective was a bit underwhelming (it certainly has the “wow” factor, but its usefulness is not readily apparent. I think a lot will depend on how app developers use the SDK to develop apps around it.), the “Firefly” feature is the most standout feature in the device. Firefly feature recognizes up to 100 million objects including phone numbers, emails, books, DVDs, audio and video content. Not surprisingly, Firefly makes it extremely frictionless to buy merchandise and content from the Amazon marketplace.

Parks Associates data shows that nearly 40% of smartphone owners use a retail and shopping app on a monthly basis, and the average time spent on retail shopping is one hour per week. A significant number of these smartphone users are potential Amazon customers, and if Amazon can succeed in placing the Fire smartphones in their hands, it will not be too difficult for Amazon to sell merchandise and content to these potential customers.

This brings up the next point. Amazon’s exclusivity agreement with AT&T was a little surprising, given that this will restrict the market potential for Fire and the history of such exclusive agreements (Facebook phone, anyone?) is not great. 


Tags: apps, smartphones

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