Amazon is widely expected to launch its first smartphone this week, and the gadget will likely boast some impressive features. Most notably, it will use four front-mounted infrared cameras to deliver 3D effects without requiring special glasses, according to TechCrunch, and face-sensing technology will enable users to navigate the user interface with head gestures. Such eye-popping elements are primary reasons why tech reporters and bloggers are already raving about the “radical new smartphone” that could shake up the mobile industry and might even be an iPhone killer.
A smartphone might seem like a natural progression for Amazon, which recently boasted that the number of Android titles in its AppStore has tripled, reaching 240,000 offerings. But Amazon claimed a mere 1.9 percent share of the media tablet market in the first quarter of 2014, according to estimates from IDC. And the smartphone market is likely to be even tougher for Amazon to crack.
The glaring absence of Google’s apps
While Android remains an open source operating system, Google has placed some severe restrictions around the platform in an effort to retake control. Among other things, Google has begun withholding popular integrated apps like Maps and Gmail from handset manufacturers that use Android to push their own, competing mobile software. Earlier this year, Samsung reportedly eased up on the development of some of its home-grown apps and services after being strong-armed by Google.
As I’ve written before, Google’s tactic doesn’t necessarily make Android unforkable, as some have claimed. A manufacturer that already have broad developer relations and a wide variety of mobile apps and services might integrate their own apps with Android, eschewing Google’s software. Android clearly has built an impressive developer community, and it has done a solid job of replacing Google’s apps on its tablets. But people often use different apps on their smartphones than on their tablets. Longtime analyst Ross Rubin wrote this week that Amazon’s lack of experience in mapping could be its biggest vulnerability as it enters the smartphone market, and he’s right. But a lack of access to apps like Google Now and maybe even Google+ is likely to be costly as well.
Other challenges in a brutal market
The Wall Street Journal reported this week that AT&T will be the exclusive carrier for the new smartphone in a deal that could benefit the carrier but might cost Amazon dearly. But as T-Mobile CEO John Legere pointed out via a Twitter tantrum, exclusivity on AT&T didn’t appear to help HTC’s so-called “Facebook phone,” which was an unqualified flop. Exclusivity didn’t shackle iPhone sales because Apple’s smartphone was a unique, must-have device in an era where smartphone penetration was exploding. Now that the U.S. market is nearing the saturation point, selling through a lone carrier – even temporarily – will limit sales considerably.
And while there’s no shortage of speculation regarding details about Amazon’s upcoming smartphone, I haven’t seen anything that would pave the way to mass-market adoption. The gadget could feature the company’s Mayday button for customer service, that isn’t exactly a huge selling point. Amazon might offer sponsored data for its own apps and content, as Re/code’s Ina Fried (and others) suggested, but that likely would appeal to the hardcore Amazon users who are already paying for its Prime service. The specs seem attractive enough, but it will be exceedingly difficult for the handset to differentiate itself from the iPhone and top-end Android gadgets.
Don’t get me wrong. While we still don’t know some important details — pricing, for one — Amazon almost certainly views its new smartphone merely as another channel through which it can drive sales of its digital content and physical goods, just as its tablets are. And Amazon certainly doesn’t need to seize a big chunk of the smartphone market to do so. The new smartphone may give Amazon’s core consumer business a boost, but I certainly don’t expect it to “shake up” the smartphone industry. Much less to be an iPhone killer.