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Why the Fire Phone is a Brilliant Move by Amazon

19 June, 2014 | Article Source: Rob LaPointe  |   (No Comments) | 15,469 Views

Amazon’s Fire Phone is another in a long line of clever business strategies by Amazon. It’s a high risk direction, since it’s clearly no easy task introducing a new smartphone platform at this stage. With iOS and Android so clearly dominating that even Microsoft struggles to gain traction, this isn’t a friendly market for newcomers. But if the Fire Phone succeeds even a little bit, it’s going to be very profitable for Amazon.

Accessing the Amazon Ecosystem

The main way Fire Phone benefits Amazon is that it essentially turns your smartphone (which you probably carry almost 24/7) into a handy Amazon point-of-sale. It’s taking the convenience of a mobile shopping app and multiplying it even further by integrating it into the core experience. Tools like Firefly, which uses image and sound recognition to identify products, barcodes, songs, tv shows, and more, break down the barriers that might prevent impulse purchases, and make Amazon the easiest option for purchasing items you need. It’s basically inevitable that purchasing a Fire Phone will lead to spending more money on Amazon.

Outside of their retail core, Amazon has been steadily building up an armada of online services, and they are working hard to push people into their ecosystem. With excellent products like the Fire TV set-top box, they’ve shown that they’re no slouch when it comes to hardware, while expanding the utility of an Amazon Prime membership to encompass more and more of our digital needs. Amazon’s main strength comes from its quality services, so the hardware is just a way of getting people on board—the idea being that once they’ve immersed themselves in Amazon services, they’ll never go back to their old ways again.

3D Phone Rumors?

Before the reveal, rumors circulated that Amazon had some kind of 3D trick up its sleeve. And those rumors were true. Fire Phone comes packed with 4 front-facing cameras in order to facilitate what they call “Dynamic Perspective,” which tracks your head in order to animate the screen and simulate depth. It’s a clever way of doing 3D, and it is definitely new and exciting (something that can’t be said for many new phones coming out), but it is also definitely gimmick meant to get people’s attention. That doesn’t mean it isn’t cool, or that it won’t be a great addition for apps and games that want to make use of it (and I’m eager to see more examples of those), but for the core experience it isn’t terrible meaningly. Consider it to be the icing on the cake.

Dynamic Perspective is just one example of the lengths Amazon will go to to attract users, because the real money is made over time as those users buy from Amazon through the phone and renew their Prime subscription. With all the features thrown in, a reasonable price-point of $199 (with AT&T contract), and 12 months of free Prime membership added on top of everything, they’ve got a good recipe to pick up curious users. We’ll keep an eye on how well they retain those users and grow, but for now I’d say that the executives over at Amazon are on the right track in an exceedingly difficult market.

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