Amazon reportedly curbs consumer tech ambition
Amazon’s now infamous Fire phone failure has led to the ecommerce and cloud giant apparently giving up on many of its consumer device ambitions, according to the WSJ.
The story of the Fire phone has been one of ambition tempered by misplacement within the market and a lack of a real compelling value proposition or differentiator. As reported by Telecoms.com last year, the Fire phone launched at an initial price point of $649 unlocked or $199 subsidised – roughly the same value as a new iPhone. Underwhelming sales and a lack of demand saw the price rapidly drop to $449 unlocked and $0.99 subsidised and in November, just five months after launch, it was listed at $199 unlocked on Amazon.com, including a complimentary $99 subscription to its Prime service. In the phone’s opening five months of trading, its retail value dropped by almost 70%.
Going back even further, we correctly predicted in June 2014 the phone was priced too high.
The most recent report on Amazon attempting to draw a line under the saga comes from the WSJ, which claims the ecommerce giant has let go of dozens of the engineers who worked on the phone. It says the company also stated future development projects on smartphones and some consumer tech has been laid to rest. This despite the company’s original consumer tech wins with the Kindle e-reader and relatively successful Fire tablet.
A brief look across past, present and potential projects from Amazon’s consumer tech lab, code-named Lab126, sees Amazon looking to take on the IoT market too. Its connected button, which can be stuck around the house and allows for rapid ordering of certain products from Amazon with just one push, was met by a certain level of bemusement. The WSJ speculated, citing unnamed sources, that it has also been working on a high-end computer to enable IoT which allows voice-activated commands from around the home – with Amazon apparently seeing value in providing low-cost platforms for facilitating repeat orders of products, instead of high value one-off transactions of premium devices.
Still, it would appear Amazon is prepared to wash its hands of the Fire phone, an ambitious experiment to penetrate a mature and stable premium smartphone market, instead receiving unequivocal criticism from multiple quarters.
