Amazon’s Fire Phone is Mainly for Amazon’s Customers

June 18, 2014

Several journalists took a small segue today in their coverage of the launch of the Amazon Fire Phone to note that Amazon’s Kindle Fire has been extinguished. Or nearly so. Based on IDC’s May report, the Kindle Fire has only 1.9% of worldwide tablet shipments, down 47% year-to-year.

However Amazon doesn’t make mobile devices to capture hardware marketshare. It wants to form a tighter bond with its customers, one that bonds them to shopping Amazon. “The most important thing that we’ve done over the last 20 years is earn trust with customers,” Amazon CEO Jeff Bezos said at the launch today. This led logically to a straightforward explanation of Amazon’s planning for the phone. Bezos said that Amazon executives simply asked themselves, “Can we build a better phone for our most engaged customers?”

Over at Mobiquity, Gene Signorini pointed out that the Kindle Fire Phone is “not about devices sold per se, but rather about the sale of content and merchandise and the overall value per Prime subscriber.” Amazon need only convince some 10% of (an estimated 20 million) Prime subscribers to buy the new smartphone to sell two million devices. “However,” he notes, “this would only represent about 1% of total US smartphone market share” in a six-month window.

Jeremy Greenfield at Digital Book World asked me for comments earlier today, in particular how the device might affect ebook sales. He printed a couple of my remarks in his Forbes report on the Amazon launch. Here is my full analysis of its likely impact on publishing:

Amazon Fire Phone

The phone is….do we call it “sexy”…with new (or recent) features like the 3D cameras, Firefly, Mayday and gesture controls.

The Firefly feature, which quickly recognizes products and gives you the option to buy them on Amazon, is bound to increase showrooming, including buying books from Amazon. But in the case of showrooming, the total number of books bought doesn’t change much, and shifting more book buying to Amazon apparently decreases publisher margins and clearly dimishes the power of book retailers.

The 4.7-inch display is better for reading than the iPhone 5′s 4 inches. Bezos did highlight that it will be “a great phone for reading.” In the research I’ve been doing for the report “Mobile Strategies for Digital Publishing” (to be published next month by Digital Book World) it’s very clear that reading is not a significant use for mobile phones today. Though with all of Amazon’s reading-friendly features this will be the best-yet phone for bibliophiles.

The downside is that not only is the mobile experience not optimal for reading, it is optimal for other purposes. Mobile is mainly about social media, texting, gaming and video. Each of these is more compelling on mobile than reading — you don’t buy a phone to read a book.

Also Amazon’s decision to go it alone on the OS — cannibalizing but not fully supporting Android — means that none of the top Google apps — Gmail, Maps, and Chrome — are available on Amazon mobile devices. Amazon’s substitute apps pale by comparison.

I’m sure the phone will take a share of the market, but with aggressive competitors like Apple, Samsung and Microsoft, that share won’t be easily gained. It’s good news for readers, but probably won’t much move the needle in terms of overall ebook sales.

But I wrote that before I read Bezos’s remark that the phone targets Amazon’s “most engaged customers,” and not, apparently, the much broader base of mobile phone users. Amazon Prime is the conduit helping consumers to get a better deal from Amazon, if they plan to spend lots of money with the company. The Amazon Fire Phone is another input device helping Prime users to fulfill their task.

June 19, 2014: Jeff Bezos, interviewed in the New York Times, says: “The phone will make Prime memberships better, and Prime looks great on this phone. It’s not that there’s no interaction between these elements. But to say that’s the primary purpose is too simplistic.” Farhad Manjoo comments in a related article “Though the device is called the Fire phone, Amazon’s new gadget is less a phone than a pocketable cash register hooked directly into the retailer’s intelligent warehouses.”

June 20, 2014: Christopher Caldwell in the Financial Times: “(The Fire phone) has more to do with connecting Amazon’s customers to merchandise via credit card than it does with connecting them to other people via conversation.”

June 22, 2014: @BenedictEvans provides the best analysis thusfar of the Amazon Fire Phone with an emphasis on Amazon’s “fork” of Android — are they solving a user problem or their own business problem?

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How Important is Mobile to Book Publishers?

December 26, 2013

I published a blog post in mid-December at Digital Book World, mostly on the topic of mobile publishing. (I gently request that you read it alongside this post: otherwise I have to clumsily repost it here — and it’s only a click away). I’m probably the last blogger in the known universe to tackle mobile’s impact on publishing. I just felt that some commentators were firing off target. But I felt inhibited. (more…)

How Would You Save Barnes & Noble?

March 30, 2012

What is it about the anonymity of the web that turns us instantly into triumphalist armchair critics? Best Buy today announced another disappointing quarter and we-who-know-all proclaim that the company is doomed, as are all retailers, and Amazon will be the only company left on the planet. (more…)

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Take Two Tablets Before Bed…and Fifty PCs

July 8, 2011

I suggest to publishers and the software vendors serving them that they take 25 PCs for every tablet they want to ingest because that will be the ratio of PCs in use around the world for each tablet (by December/2012).

All Things Digital today recharged the iPad hype engine with its article “Tablet of Choice for Android Users: The iPad.”

It’s designed to be a startling headline, and it only makes sense. (more…)

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Flash vs. HTML 5: The Early Years

October 14, 2010

The future of Adobe’s Flash format is murky. I first glanced at Flash technology’s murk when Steve Jobs launched an attack last April. Jobs stated that “Flash was created during the PC era – for PCs and mice…. But the mobile era is about low power devices, touch interfaces and open web standards – all areas where Flash falls short.”

Jobs pointed to HTML5, a W3C proposed standard, as the preferred alternative. The W3C released a new working draft of HTML5 on October 12. The development work is continuing at a near-feverish pace (by W3C standards of developing standards).

HTML5 is hot. In a May blog entry I covered Scribd’s dramatic commitment to HTML5 in lieu of Flash.

In September Computerworld offered:

The W3C is investigating the possibility of incorporating voice recognition and speech synthesis interfaces within Web pages. A new incubator group will file a report a year from now summarizing the feasibility of adding voice and speech features into HTML, the W3C’s standard for rendering Web pages. AT&T, Google, Microsoft and the Mozilla Foundation, among others, all have engineers participating in this effort.

html5-affect-seoSource: Varologic SEO Blog

But not all the news is positive. ZDNet reported this week that Facebook found that Flash still outperforms HTML5 for video on mobile devices (albeit modestly), “a zinger of sorts” in the Flash war.

And InfoWorld found a W3C official who stated that despite the hype, the HTML5 specification isn’t yet ready due to interoperability issues.

I guess I’m just the show-me tech guy. Here’s all I know about the technical limitations of Flash:



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