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Why Amazon Might Want a Big Piece of the Smartphone Market 61

Posted by Soulskill from the because-the-world-is-not-enough dept.
Nerval's Lobster writes: If rumors prove correct, Amazon will unveil a smartphone at a high-profile June 18 event in Seattle. According to a new article in The New York Times, Amazon's willing to take such enormous risks because a smartphone will help it sell more products via its gargantuan online store. In theory, a mobile device would allow customers in the midst of their daily routines to order products with a few finger-taps, allowing Amazon to push back against Google and other tech companies exploring similar instant-gratification territory. But a smartphone also plays into Amazon's plans for the digital world. Over the past several years, the company has become a popular vendor of cloud services and used that base to expand into everything from tablets to a growing mobile-app ecosystem. A smartphone could prove a crucial portal for all those services. If an Amazon smartphone proves a hit, however, it could become a game-changer for mobile developers, opening up a whole new market for apps and services. Amazon CEO Jeff Bezos has succeeded in the digital space largely by opening up various platforms—whether Kindle self-publishing or the Amazon app store—to third-party wares. It'll be interesting to see whether he does something similar with the smartphone. Early reports suggest Amazon's phone will be exclusive to AT&T.
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Why Amazon Might Want a Big Piece of the Smartphone Market More

Why Amazon Might Want a Big Piece of the Smartphone Market

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  • Now with Prime Smugness!

  • Anyone who wants to shop online at work will shop online at work with a bigger screen.

    The amazon app while useful is a pain to use on a small screen.

    Now if you combined amazon prime music and movies into the phone then it might make sense. however even then the use cases for watching movies and listen to music is quite small compared to the whole mobile phone market.

    • I find it quite easy to use. Granted, I have a Samsung Note II - which has a nice 5.5" screen. But it's not hard to shop from it - especially Kindle books. Now if you had a smartphone with a sub-4" screen, I could understand the concern...

    • Re: (Score:2)

      by rtb61 ( 674572 )

      All to many bosses are greedy control freaks, for the majority of works there is not the opportunity to do anything but work at their computer terminal. To do anything online means carefully slipping out their smart phone and logging on, without getting caught. You have to be careful not to view every ones interactions through your own interactions. So quickly sneakily logging on get your stuff down and play without getting caught, work in many environments not being much different to high school, except t

  • Could be big if... (Score:3)

    by Scowler ( 667000 ) on Tuesday June 17, 2014 @04:16PM (#47258065)
    ... there is no subscriber cost other than Amazon Prime, at least for a basic smartphone plan. A lot of cheapskates have no particular allegiance to iOS/Android, and would be starry-eyed by such a deal.

    • Re: (Score:2)

      by nomad63 ( 686331 )
      I would buy it if it gave me unlimited free data a few minutes of talk time with prime membership. I would also finally say yes to prime. Right now I am not shopping amazon enough to justify prime as their video titles are not a deal maker or breaker for me. But if they throw a basic cell plan into the prime mix, then the balance of the scale may tip enough to convince me. But again, shopping on mobile platform is something I will never do. I prefer to open multiple screens to compare products before making

      • I'd take it if it gave me 2GB data (and after that a throttle, not cutoff), 100 mins talk, texts.

        But unless it's cheap, I'm hesitant to buy a 1st or even 2nd gen smartphone from a new entrant into the market.

        Even if they get everything perfect, apps just won't be there.

        • Re: (Score:2)

          by nomad63 ( 686331 )
          Data is king. I am willing to live with 3G, if it is really unlimited. LTE is good but for the things that require fast connections, I can wait to get home. The only allure of MVNOs nowadays is the unlimited data. I don't like to byte-count when I am mobile.

  • In other news (Score:5, Insightful)

    by slinches ( 1540051 ) on Tuesday June 17, 2014 @04:16PM (#47258071)

    I want to win the lottery.

    Of course Amazon wants a major piece of the mobile phone market. That's not news. What would be news is if they make a phone that plays nice outside of Amazon's ecosystem and isn't locked down like the rest of the kindle family of products.

    • Re: (Score:2)

      by Threni ( 635302 )

      If it has the Play Store I'll consider buying it. If it doesn't, I won't. It's pretty simple.

    • Why anybody would want to be in the mobile phone market is less clear to me than it seems to be to you. Unless your name is Apple, your margins will be miniscule. Unless your name is Samsung, you aren't a big enough player to make up for low margins on huge volume. In short, you will not turn a profit [bgr.com].

      I assume Amazon has an app you can install on any phone. Why make phones?

      • Amazon already have their fingers in movies, music, ebooks and app markets. With the leading vendors of smartphones having their own content deals and distribution partnerships (that generally don't include Amazon) tied to their devices, Amazon may see the move into smartphones as essential to getting their existing and future services into people's hands. Similar to what Google has done with Nexus devices, Amazon could sell smartphones at very low margins, or even at a loss, if in doing so they can protect

      • Amazon's margins [forbes.com] are in the low single digits right now. The razor thin margins of the mobile handset market will only be an improvement.

      • Re: (Score:3)

        by beh ( 4759 ) *

        Think about it this way - before Apple made their inroads into the phone market, the dominant players were companies you don't even hear much about as phone makers any more (Nokia, Ericsson, ...) and back then people thought, Apple wouldn't be able to make any significant inroads into that market either.

        In fact, they pretty much disrupted the entire sector in the process - they may not be the market leader by market share, but they managed to build up and retain the "premium" brand image in the market - and

  • People can already use the Amazon app to buy stuff on their mobiles. So the Amazon phone is about more than that. Perhaps like Google they want to spy on you so they can advertise to you.

    • I don't get it either. It's like the failed 'Facebook Phone'. A specific phone won't make it any easier or better to shop on amazon. Anyone who can install the apps or visit the website can do that.

    • No, to use Amazon Apps on my first phone, I had to type in a secret key combination in order to install the Amazon App Store. My next phone was rooted, so no big deal. Obviously, they want it to come as default. It's just like everything else, if you have to google a secret key combo to install something, how many people are really going to use it?

      • Re: (Score:2)

        by AuMatar ( 183847 )

        He meant the amazon.com app that allows you to buy stuff from Amazon, not the Amazon App Store. Amazon.com app is on Google Play and preinstalled on many devices.

      • I just tested it out. I went to Amazon, downloaded the AppStore app and ran it. Others may have had to change the security setting to allow 3rd party apps but I already had done that. I could walk my grandma through the steps to install it.

        • Right, but just like their Kindle Fire tablets, the Amazon Phone (Fire Phone? whatev) will not come with the Google Play store installed, but only provide access to Amazon's App Store.

          Just another slice of the mobile pie.

  • Or the alternative high end & hot? Will Late & Lame sell or will they give them away?

    • I just purchased an 8-core THL w200s from Amazon for 200.00 bucks and Prime shipping. If they preloaded this phone with the Amazon App Store and marketed the hell out of it, they could sell the crap out of these phones for 200.00 bucks a pop. A similar American phone would sell in the 500.00 - 600.00 range.

      And that is exactly how they could make a big splash in the Smartphone Market. A kick-butt phone in the 200.00 to sub-200.00 price range...

      • I just purchased an 8-core THL w200s from Amazon for 200.00 bucks and Prime shipping. If they preloaded this phone with the Amazon App Store and marketed the hell out of it, they could sell the crap out of these phones for 200.00 bucks a pop. A similar American phone would sell in the 500.00 - 600.00 range.

        And that is exactly how they could make a big splash in the Smartphone Market. A kick-butt phone in the 200.00 to sub-200.00 price range...

        There is no way that being tied to AT&T will allow them to hit the $200 price point without a dreaded 2 year subscription (when the unsubsidized price hits $500-600) AT&T don't roll like that - that's what their off-brand MVNO is for (Go Phone, etc).

        • AT&T would love nothing more than a rapid reduction in the price of handsets. Means a combination of lower subsidies for AT&T, and lower prices (and hence higher usage/take rate) for consumers.

  • I can't help but seeing how a real alternative to the Google Play Store as being a bad thing. However, as someone who has used both stores, developers treat Amazon apps as less important, that's for sure. Many apps I use frequently are several versions behind on Amazon. I finally had to break down and use Google to get updates.

    I think Amazon stuck a fork in the eye of Google when they pulled off a fork of Android. If they are going to really pull it off, though, Apps need to be kept up to date.

  • As in why anyone would want a smartphone from Amazon.

    I can easily see why amazon would like to add to it's monopoly.

    The real question is can it offer ANY advantage to us for using it's hardware? If it can't, then they should give away an app, not try to sell us hardware.

    For me, I can't think of anything they can do for me with hardware that they can't do with software.

    • Re: (Score:2)

      by rsborg ( 111459 )

      As in why anyone would want a smartphone from Amazon.

      I can easily see why amazon would like to add to it's monopoly.

      The real question is can it offer ANY advantage to us for using it's hardware? If it can't, then they should give away an app, not try to sell us hardware.

      For me, I can't think of anything they can do for me with hardware that they can't do with software.

      Why would Amazon want a tablet? Perhaps for the same reason that Microsoft wants Azure? Everything is converging to phone/tablet/laptop combined with branded could services to support the basics (email, calendar, music, video, shopping, app store...), so Amazon is just doing what it feels is necessary to keep up with the Joneses.

      Either Apple was very prescient or just lucky to have gotten there first?

      • Re: (Score:1)

        by Isara ( 869637 )

        Why would Amazon want a tablet? Perhaps for the same reason that Microsoft wants Azure? Everything is converging to phone/tablet/laptop combined with branded could services to support the basics (email, calendar, music, video, shopping, app store...), so Amazon is just doing what it feels is necessary to keep up with the Joneses.

        Either Apple was very prescient or just lucky to have gotten there first?

        A tablet makes sense, though, given Amazon's Kindle business. Unless Amazon's looking to make something the size of a Galaxy Note, I just don't see the advantage of getting a phone from Amazon (and one that's locked to AT&T, no less).

    • Re: (Score:1)

      by f16c ( 13581 )

      I have a Fire HD tablet and book reader. It's a really nice tablet, it's inexpensive and it works great when used to watch netflix movies over wifi in our apartment. It appears to match pretty much nay other tablet in functionality and breadth of applications and makes a pleasant book reader if used as such. I'm going to assume that the phone would be similar. It won't be flashy but it will do what people want for similar digital services over a phone, but for cheap. It's nice to do things over the web with

  • Here's a story I'd like to see: (Score:1)

    by Anonymous Coward
    Why articles whose headlines start with the word "why" are nothing but clickbait opinion pieces and have no place on a news site.
  • Google's income stems from making advertisers believe they know what consumers want. As Amazon's catalog grows, it becomes a larger and larger center of what consumers don't just want, but actually shell out for. From a managerial perspective, I'm sure they could talk about saving money by combing their data centers. As a consumer, I'm not sure that I'd welcome such a merger.

  • Drive amazon services? (Score:4, Interesting)

    by mveloso ( 325617 ) on Tuesday June 17, 2014 @05:08PM (#47258413)

    It's odd - I'm not sure if a phone would drive more amazon services. What's their motivation? They already see what I buy, when, and in many cases for whom, but they don't really seem to use that information very effectively.

    I see some targeted stuff, but not as much as I would expect given my ridiculously long shopping history. A phone would allow them to know more, but they don't seem to be using the data the have...so the extra data would be pointless.

    They're not like google, in that their mobile is not a stalking horse for targeted ads. They're not really like Apple, since they don't really make high-end hardware. Launching a cellphone because you're feeling left out isn't really a great business case. Amazon doesn't really need to control the experience, since you can buy anything on amazon on other platforms.

    Maybe they got a good deal on bulk minutes and cheap hardware, and want to pass the savings onto the public?

    • Re:Drive amazon services? (Score:4, Interesting)

      by Qzukk ( 229616 ) on Tuesday June 17, 2014 @05:19PM (#47258473) Journal

      I think it's easy to see where they are going: You take your Amazon phone to the store, snap a picture of what you want, and get it shipped to you. Or not.

      Amazon then uses the decisions and GPS coordinates of the people using their phone to discover that store X in your city is cheaper than Amazon. They then lower the price of that item that they show to the people whose phones are or have been in that store, until the people in that store start buying it from Amazon instead.

    • Re: (Score:2)

      by Maow ( 620678 )

      +1 Interesting

      (accidental Troll mis-mod being undone with this post)

  • probably cheaper to buy blackberry than develop a phone from scratch, and blackberry's technology is quite impressive despite the pathologically incompetant CxO's steering as hard as possible towards the ground.

    BB10 already supports android apps so making amazon app store apps run on it will be easy, then integrate tightly with amazons media services (kindle, cloud player, prime music, prime video, instant video rentals, MP3 store) and they will have hardware and media services rivaling apple's and beating
    • > probably cheaper to buy blackberry than develop a phone from scratch

      If Blackberry can't market their own phones, how could a non-phone company like Amazon do so?

      • Re: (Score:2)

        by Lehk228 ( 705449 )
        anyone could outmarket blackberry's executives, they managed to turn #1 marketshare and +7billion in the bank into what they are today.

  • And exclusively with AT&T?! Let me rush right out of here... and start shorting AMZN.

    • Yes, because nobody could ever launch a smartphone exclusively with AT&T and have it be a success...

      • Re: (Score:2)

        by rk ( 6314 )

        Well, technically, Apple launched exclusively with Cingular, then they merged with AT&T.

        Relax, I was going for funny. I guess that didn't work.

        • Well, if we want to be really technical (and I love a good pedantry battle!), the iPhone was announced with Cingular, but launched with AT&T Mobility. The AT&T (formerly SBC) acquisition of BellSouth (which owned the rest of Cingular) closed in December 2006, the iPhone was announced in early January, but by the time it actually launched in June, the Cingular name had been dropped in favor of the AT&T brand.

  • Desk top computers, for non-business use, are the pianos of a garage band. They are huge, stationary, fully functional and easy to on the fingers. People are moving away from the desktop and using small devices to do business with Amazon which means that Amazon is not a point-topoint business model. I think it only reasonable that Amazon wants to tap into the entire business model. If they do it right, it'll be a big hit. If not, it's back to the drawing board.

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