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Rumors from the past few years that Amazon.com Inc. was building a smart phone bore fruit Wednesday when the online retailer revealed the Amazon Fire, a mobile device built to ease the mobile commerce experience on its Web site.
It may herald another way to shop Amazon, but it doesn’t appear to yield much to other mobile-commerce or mobile-payments outlets, analysts say.
The smart phone, priced starting at $199 with a contract on AT&T’s network, the sole carrier, includes a variety of technologies, such as near-field communication, multiple cameras, and cloud storage. Notably, it also includes the Amazon cloud-based payment wallet and Firefly, a service that can recognize a variety of items, such as bar codes, images and objects, enabling users to add them to their Amazon Wish Lists or to a shopping cart for immediate purchase from the retailer.
The smart phone, available July 25, joins a raft of other Amazon mobile consumer devices, including its e-readers, Kindle Fire tablets, and the Amazon Fire TV set-top box.
All of these devices are designed to provide consumers a way to engage with Amazon. The Fire phone stands out as no other retailer has anything similar. Amazon says it has 244 million active customers worldwide. Apple Inc. and Google Inc. are not primarily retailers, though their smart phones and their accompanying media and app stores often are mentioned alongside Amazon in terms of market influence.
“I’m not aware of any other phone so connected to a commerce provider,” says Rick Oglesby, senior analyst at Double Diamond Payments Research. “It’s a very end-to-end Amazon experience that hasn’t been done anywhere else.” The Fire phone should prove to be a good commerce engine for Amazon, he says.
Similarly, Nick Holland, senior payment analyst at Javelin Strategy & Research, calls the degree of integration with purchasing on Amazon.com “extremely compelling.”
As for the device’s mobile-payments potential, Oglesby suggests that Amazon may not welcome other mobile-payments companies. “Amazon devices generally are pretty locked down,” he says. That may make it difficult for mobile-wallet providers, he says, to get their apps on the device. Though the Fire, and its Kindle Fire tablet brethren, uses a heavily modified version of Google Inc.’s Android operating system, apps are generally available only via the Amazon app store and not from Google Play.
Holland views the Fire as a harbinger of something else. “All eyes are on the wrong target,” Holland says. Everyone is obsessed with Apple, as shown by copious what-if comments about Apple entering mobile payments, he says. “The real fun is happening in left field, here with companies like Amazon.”
The Fire is the next generation of showrooming, which is what happens when consumers check out products using their smart phones in physical stores before buying them at a lower price from online merchants, Holland says. “It really telegraphs what you can do when you devote your resources to fusing online and offline [shopping], using the phone as a conduit between the two.”
