The Battle of the Clouds

“Why a phone?” reflects the generally confused response from many a layperson and journalist to Amazon’s announcement of their “Fire” smartphone device.

Their presence in the tablet space has established them as a major force in that area, but their desire to push into smaller mobile size spaces still confuses many. So why exactly have Amazon chosen to make themselves felt in the smartphone market?

Firstly, it’s useful to put things into perspective, the emergence of 5 and even 6 inch tablets has more or less blurred the line between mobile and smartphone beyond recognition, hence the catch-all term “mobile device”. The only key point of differentiation here is the existence of radio signal receiver and transmitted that allows for traditional phone calls to be made, that’s the hearthstone of the device, but what’s built on top of it, in terms of mobile software, is arguably more important.

So Amazon entering the smartphone space isn’t particularly surprising here. They’re moving in explicitly to challenge competitors like Google, Apple and Microsoft on the basis of the existing products and services they can offer, and when it comes to online services Amazon have significant leverage: Books, the world’s largest e-commerce portal, TV and film on demand with Amazon Prime and so on.

Indeed, a key selling point of the Fire is likely to be Amazon’s promise of unlimited cloud storage space for photos, something that, given Amazon Web Services growing reach, makes a lot of sense. It’s also something we’ve heard Microsoft talk about a lot and most recently, Apple, who moved at their iOS 8 event to migrate all photo storage to the cloud. Amazon’s decision to include one-click purchasing on a touch device also makes a great deal of sense, being ideal for a touch based phone and perfect for leveraging the growing phenomenon of “m-commerce”. However, it’s worth noting that Jeff Bezos was explicit in the reveal that this was a device intended primarily for reading and watching TV and films.

What was surprising about Amazon’s announcement therefore wasn’t so much their entry into the smartphone space, but the attention paid to hardware. Whilst the snapdragon processor and 2gb of RAM are fairly standard these days (it puts the device about on par with the Nexus 5) aren’t ground-shaking in any way, the interface, which employs a unique 3d approach called “dynamic perspective” was unexpected, this 3d approach to UI sits alongside a gestural system which allows for changing menus with the flick of a wrist.

This reflects a radically different approach to the Kindle Fire tablet, which was fairly unremarkable in terms of user experience and hardware. Clearly Amazon have chosen to invest in a device with unique selling points beyond merely being a gateway to Amazon services.

The most significant problem Amazon will face is brand value. Amazon have significant brand value to consumers. The average consumer recognizes Amazon as a deliverer of services, and an extremely efficient one at that. But they do not recognize Amazon as a manufacturer of world-changing, desirable hardware. Interestingly this is an area where advertising and marketing will have to play a key role, if consumer perception is going to be changed, clever advertising will be key.

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