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Amazon's Fire Phone Disappoints and Motivates

fire Phone logoThis past summer, I remember reading in the news that Amazon had just released their first ever smartphone. I had no interest in purchasing the product as I was, and still am, a satisfied Android customer. I did however have a curiosity as to what the product would be like, and waited for someone I knew to purchase one and show me theirs.

We are now in November, and I still have never personally seen the device. The reason why most people have never seen the device is because sales have been very poor so far. So poor, that Amazon actually has over $80 million worth of unsold stock sitting in their warehouses. To date, Amazon's taking a loss on the product that is approaching the $200 million mark.

This development prompts many to wonder why Amazon ever entered the smartphone market, since Android and iOS together account for about 95% of the said market. This duopoly is stronger than ever, and shows no signs of welcoming a third member to join the party. Although Fire Phone sales have been slow, Amazon is optimistic and motivated to continue improving their new smartphone with new iterations of the device. What gives them hope is that the Kindle suffered similar failures at its launch, yet has proven to be a success story. Amazon's Kindle sales account for about 8% of the tablet market, and the revenue generated from Kindles accounts for about 10% of Amazon's yearly revenue.

If Amazon continues to drop their smartphone prices and improve their Fire Phone, I have no doubt one day I'll be able to play with a friend's Fire Phone.


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