Amazon Fire: It’s not just about the phone

Amazon released the “Fire,” the company’s first entry into the smartphone market, on June 18, 2014. While the device has caught a great deal of media attention, Amazon faces an uphill battle when it comes to gaining consumer interest.

Amazon’s main barrier to overcome is that the majority of US consumers already own smartphones. According to Mintel’s Mobile Phones – US 2014 report, 58% of internet users reported owning a smartphone. Although there is still room for first-time buyers, 71% of respondents who planned to buy a new smartphone in the next six months already owned one, meaning that Amazon will have to overcome the familiarity of existing market leaders. Considering that the Fire is priced similarly to the Samsung Galaxy 5S and the iPhone 5S, Amazon is placing a big bet on the phone’s features to draw customers.

Can Amazon Fire compete with other smartphones?

Amazon heavily emphasized two features with the new phone: Firefly, an app that recognized printed information and products and Dynamic Perspective, which enhances the user interface.

Firefly recognizes printed phone numbers and web addresses as well as physical products, saving users the trouble of having to type information in or manually search for products online.  While it’s a significant step forward in terms of convenience, smartphone users can already compare prices with the wealth of third-party price scanning and comparison apps already available. The ability to scan printed information could be valuable, but it is not likely to be enough to justify the pricing of a high-end device.

Gaining interest in Dynamic Perspective will depend greatly on how much software can actually use it. The feature can potentially allow for a more immersive experience – by enabling mobile gamers to control in-game characters with gestures for instance. However, the lack of existing software that capitalizes on Dynamic Perspective will likely inhibit early growth. Amazon has released the software development kit for the Fire, but gaining developer interest is just as much of a potential issue as getting consumers interested. If the phone experiences low adoption, developers are unlikely to design software such as games solely to take advantage of Dynamic Perspective when most of their audience will have other devices.

For example, BlackBerry ownership has lagged behind the iPhone, and the number of apps in each device’s respective app store showcases the difficulty in maintaining developer interest among lower-performing devices. In an August 21, 2013 article, Mashable reported that BlackBerry had approximately 235,000 total apps, close to 50,000 of which came from one developer. For comparison, Apple announced in October 2013 that its app store had more than 1 million apps available.

The Fire is more than just a phone

Despite the apparent short-term challenges, Amazon does not have to take the throne from Apple and Samsung to make the Fire phone successful – it only has to gain enough consumer interest to create a loyal base of Fire Phone users. As with the Kindle Fire tablet, the phone is deeply integrated with Amazon’s other services, including music, video and shopping.  This makes the Fire a part of the overall Amazon ecosystem and will likely drive sales of Amazon’s other products and services among the device’s users.

To learn more about Mintel’s latest mobile phones report, click here.

Bryant Harland brings almost a decade of experience working in the tech arena, most recently as a Senior Technology Writer with Brafton News, where he oversaw the editorial team, wrote as a trade journalist and prepared a range of industry white papers.