A Kindle Phone Won’t Set the Market on “Fire”

Published on Author Eli Fennell

Rumors continue to surround an Amazon Smartphone, allegedly to be called the Kindle “Blaze”.  It’s not just a rumor, really, it only makes sense they would do this, after all they’ve done well in e-readers and now in 7-inch tablets with the Kindle Fire.  Why not a smartphone?

Some pundits automatically assume it will be a similar success to the Kindle Fire, but there are reasons to think otherwise.  On the one hand, where is the price appeal?  The Kindle Fire’s primary appeal was the idea of a decent tablet for a good price.  How will Amazon undercut the competition with discount smartphones when cheap but good devices have long been available?

Very few people actually buy phones through Amazon in terms of total market share, and while discounts can be enticing, let’s assume Amazon isn’t going to become the primary purveyor of smartphones any time soon, even if an Amazon smartphone sold through their site might generate some revenue.

Amazon will have to make deals with carriers.  How many will carry an Amazon smartphone, and will it be heavily subsidized like an iPhone?  Most likely not, more likely it will be given little subsidization by carriers, who will turn around any profit to subsidize iPhones if they have them.  Who would want to promote a device that encourages shoppers not to buy their smartphones from carrier stores?

Even if the device is very affordable with a contract, it may struggle against iPhones, Windows Phones, and Google Android phones that are similarly priced, if not cheaper or even free, and will in many cases be better devices.  If the device is high-end it will struggle against already established brands like Apple, Samsung, and Motorola with their iconic high-end phones like the iPhone, Galaxy, and Razr.

Prepaid carriers don’t offer much to ease the price of a smartphone, and there are a lot of inexpensive Androids on these carriers, made cheaper by discounts.  Amazon can’t really undercut them without taking a very heavy loss they may not recoup.  An Amazon phone isn’t an obvious content device like the Fire.  It’s good for music, but any smartphone is that, so that’s only a selling point if you’re committed to Amazon music, and even then not much of one since you can use your music on other devices.

What about video viewing, a major appeal of the Kindle Fire?  I’m sure some people watch movies on smartphones, but it’s hard to see that this is a killer feature for average smartphone consumers, and the same applies for reading books and magazines, and the ability to order real world products through Amazon isn’t a killer feature either, nor is one of the smallest app markets out there, with apps that are more expensive on average than the same apps on Google’s Android Market, and one-touch ordering hardly seems a selling point.  Even competing as a high-end multimedia smartphone will be difficult to do since they are unlikely to offer the highest screen resolution, audio quality, etc…

And remember, with developers optimizing apps for the form factor of the Kindle Fire, many will need to be reworked for a smartphone, effectively fragmenting their market from the word go.  Amazon already has an app market for traditional Android smartphones, but their own forked version of Android may not even run all of these properly, let alone the true Kindle Fire apps.

This leaves us just music, a feature of every smartphone, and Amazon Music wouldn’t even be a unique feature of their own smartphone.  Their Silk browser has failed to impress and may not even work the same on a smartphone as a tablet.  Kindle Fire customers may want one, but unless Amazon has some amazing innovations up their sleeve, it’s very hard to imagine that many consumers wouldn’t simply choose similarly priced or cheaper devices with innovations like streaming Text-to-Talk, AI Assistants, Facial Unlock, Multiparty Video Chat, Gesture Control Technology, and more than a retail company like Amazon can hope to keep pace with for long without abandoning their core business model.

In doing so they even risk exposing the weakness of their Kindle line as a substitute for other brands: there is nothing impressive about them beyond being fiendishly good Amazon content appliances.  The Kindle Fire itself is like a larger iPod which not only plays music, video, and browses the web via Wifi only, but plays video on a 7-inch high definition (but not very impressive) screen and can be used to read books and magazines.  It is good enough for the price as the saying goes, but overall is nothing to write home about.

The iPod set the stage for the mobile market, but the iPhone and iPad created that market.  Amazon, unfortunately, is no Apple.  They don’t even really make their own operating system, let alone hardware.  Their tablet success is unlikely to persist at its current level, as cheaper devices with killer features unmatched by Kindle devices come to market and the fickle media that once lavished all its affections on Apple finds new stars-of-the-moment to adore.

A Kindle smartphone will hardly be the new iPhone, with drooling crowds eagerly awaiting each new version and willing to pay more than other devices or pay for meaningless cosmetic upgrades, or devices with substandard hardware, and Amazon must know this, but what else can they do?  Admit defeat without trying?  Even if they get a small profit from it, that’s better than nothing, and keeps their devices out there in a mobile market where each and every brand now wants their own signature line of mobile devices, from Amazon, to Barnes & Noble, to Facebook, Sony, and even Prada.