Amazon launched its very first smartphone called, fire phone, in 2014. It positioned itself as a lifestyle product and direct competitor against Apple’s iPhone. But the sales went nowhere. In the first 2 months, they sold just 35k units, whereas Apple’s then-current model, iPhone 6 received 10 Million orders in the first 3 days. Amazon has eventually written off $170M as losses for fire phone and it had $83M worth of inventory left.
So why did the fire phone fail?
Amazon is known for its affordable devices namely the kindle and fire tablets. They sold these at a loss or break-even prices, which was a primary reason for their success. So consumers expected similar pricing for the fire phone too, but that didn’t happen.
Fire phone started at $650, which is equivalent to flagship phone prices in 2014. For comparison, Apple’s iPhone 6 started at the same price. This meant people weren’t willing to shell out so much for a phone that was the first attempt of a company that didn’t make smartphones so far.
They also entered into an exclusive carrier partnership with AT&T, which smaller brands do to increase visibility and marketing. This meant only people with that carrier can buy it. And Amazon didn’t need the marketing support anyway, as it already has good marketing channels.
Bland Design & Hardware
The device physically looked just like most Android devices at that time and didn’t have any distinguishing set of features to stand out. The hardware specs also mirrored its android counterparts in that price range.
Features that didn’t provide any Utility
One place where the Fire phone stood out is in its software features.
Its dynamic perspective enabled users to see the screen in 3D, enabled by 5 front cameras that tracked user movements to create the effect. It was a cool feature but didn’t provide any tangible benefit to the user.
Its firefly feature can be used to scan any object and can be bought on Amazon. Back then people shopped online mostly on PCs, and laptops. And also people saw this as Amazon trying to get you to buy more on their platform.
Poor Fire OS
Just like the Windows phone that failed badly, the fire phone came with an all-new OS called fire OS. The phone didn’t have Google’s Playstore which had millions of apps, instead, it came with Amazon’s own app store with just 250k applications. And app developers didn’t come forward to make apps for a new OS, while Android and iOS are already well established. And to make things worse, the fire OS didn’t support any of the Google applications like Gmail,Maps and YouTube, which are commonly used in most smartphones.