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The Fire Phone Debacle and What It Means For Amazon's Future
HughPickens.com points out an article at Fast Company that dug into the creation of Amazon's floundering Fire Phone to figure out why the company pushed so hard to bring it to market. The piece is an indictment of Jeff Bezos's determination to make the Fire Phone into a competitor for an already-saturated high-end smartphone market. "This wasn't some vague guideline from an executive busy running other parts of the business; based on interviews with more than three dozen current and former employees, most of whom were deeply involved with the project, the CEO drove every aspect of the phone’s creation from the outset."
Now that Amazon's growth is slowing and profits have yet to be seen, investors and analysts have run out of patience for gambles like this one. "What makes the Fire Phone a particularly troubling adventure, however, is that Amazon’s CEO seemingly lost track of the essential driver of his company’s brand. It’s understandable that Bezos would want to give Amazon a premium shine, but to focus on a high-end product, instead of the kind of service that has always distinguished the company, proved misguided."
Now that Amazon's growth is slowing and profits have yet to be seen, investors and analysts have run out of patience for gambles like this one. "What makes the Fire Phone a particularly troubling adventure, however, is that Amazon’s CEO seemingly lost track of the essential driver of his company’s brand. It’s understandable that Bezos would want to give Amazon a premium shine, but to focus on a high-end product, instead of the kind of service that has always distinguished the company, proved misguided."
> "but to focus on a high-end product, instead of the kind of service that has always distinguished the company, proved misguided."
What service suffered as a result of this? The product ended up not being what was desired by the public, but what specifically would have fixed this? Just saying "with 20-20 hindsight, that wasn't a good use of your time" is meaningless. When you have built a multi-billion dollar business, you can claim that you have better judgement, until then you are just making noise
David Lang
Amazon has tried to create their own product lines with the Kindle and Fire branding, but unlike Sears' branding for Craftsman and Kenmore, the Kindle and Fire devices are less ends, and more means, at least in my eye, and when they hamstring the phone version by basically taking everything useful out of Android that made it popular (ie, Google's through-the-internet connectivity for 'cloud' stuff) they take away most of the means for which I would use the device.
I honestly don't care what brand of smartphone I have any more than I care what brand of business computer I have at work, in that the phones I buy run vanilla or close-to-vanilla Android, and the computers my work supplies for me generally run Windows, or I install Linux on them myself. The Fire Phone isn't really Android in that what I want to use Android for isn't there, and the experience would be just as foreign to me as using an iPhone or a Blackberry or a Windows phone.
Amazon over-valued their own brand. Amazon is a service more than a product, and attempting to be a product hasn't worked as well for them as they expected.
Do not look into laser with remaining eye.
All of their hardware sucks. Largely because the software in their hardware sucks. They're using Android, fine, but it's a locked-down version of Android customized to exclusively use their own store (I believe you can get Google Play back, but it takes work). Which is them giving both the user and Google a big "fuck you."
And then they're trying to break into a saturated market with big name competitors. What's the killer feature? Where's the value added? What aspect sufficiently differentiates them from their competitors? The Amazon name isn't known for phones and won't carry the product. Their shaft of the customers by tying the phone to their own app store doesn't help. Their help system? Few enough people want to admit they need help, much less have the foresight to improve the experience. And Android is so easy to use, who really needs that much help anyway, especially help they can't get from say, their kids or their friends?
The rest of Amazon's hardware sucks too. They're copies of other products that might visually be nice, but lack usability sense. Google's USB fob can go anywhere. Amazon can only go where Amazon wants you to go. How can that even compete?
And then there's the other stuff that's not even worth mentioning. Like the speaker. What is that even for? Listening to music from Amazon only? Where's the direction? Where's the strategy? It's like they're throwing shit at the wall to see what sticks. Except said wall is the glass back of an elaborate toilet that also is a waterfall.
Actually, I know what it is. They had so much success with the Kindle, they had no idea what made the Kindle successful: they already had the dominant online book store and they were the first to market. Of course it would be successful. But they don't dominate anything else, and they're late to the game everywhere. How can they expect the same success?
"If a nation expects to be ignorant and free in a state of civilization, it expects what never was and never will be."
They risked a gamble, so what. Companies build products that fails - it's not even a headline. Amazon built something that people think is a failure, then everyone went to bed, woke up the next day and everyone moved on.
My ism, it's full of beliefs.
Well its the velocity that's slowing so not second order derivative, its the first derivative, Amazon is still growing but the rate of growth is slowing, Google [Forbes Amazon Growth].
It makes no profit and already has successful and yet unprofitable cloud services. Cloud services won't fix the loss making business. The Fire phone doesn't work, and the Fire TV device doesn't sell enough to turn the company profitable.
Investors want returns, not brand. But when he starts making returns, then he gets a PE and then they'll realize that he has a very low/sometimes negative margin discounter business which won't generate large profits.
And all of this must have been very demoralizing and irritating for the people who worked on it, but at the end of the day: the only issue which matters for the Fire Phone was the Kindle Fire being a shitty tablet.
Without Google Play the Android operating system is worth less than Windows 8. I was dumb enough to buy a Kindle Fire. Fantastic device, aside from being totally useless. That's not a contradiction either: It's like a gorgeous car with no engine.
A smartphone does one thing: lets you install apps from the official App store. Your device doesn't have the official app store? I don't care how pretty the user interface is, I'm not going to deal with a version of Android which only lets me use the Amazon App store, when I can get Google Play AND the Amazon App store on a Nexus 5. Duh!
The Amazon phone takes something cool (Android) and locks it down Apple style. Apple can get away with it because they have perceived value in better quality hardware/design/vertical integration/app selection, etc. Amazon doesn't offer any of those benefits. So it ends up coming off as a cheap, locked down Android phone with crummy hardware and many of the good parts of Android missing. There are other cheap Android phones you can buy that offer more than the Amazon phone.
What Amazon needs to do is offer something the other guys can't offer. Give customers free shipping on anything they buy from Amazon using their phone. Or maybe a half price Amazon Prime deal for the duration of the 2 year contract. Make it possible to add Google Services without having to root the phone. Stuff like that.
Simply putting out yet another cheap Android phone is simply a race to the bottom. But a mostly stock Amazon branded Android phone with some cool Amazon services bundled in with it - now you're cooking with gas.
Some 33% of the fortune 400 have inherited their wealth. All six children of Sam Walton are in fortune 400. The Koch brothers, for all their manipulation and access to the government would have more money if they had just invested their inheritance in index funds.
People without inheritance, even if they make it to top 1% by income, most of them will not be able to accumulate to make it to top 1% by net worth. Of the 97% of the Americans who don't inherit much, about 2% barely make it to a million net worth including their home equity. It takes 4 million to crack the 1% by networth mark. These low end millionaires with home equity are what counted to tout "95% of the millionaires are self made". Most of the people below the fortune 400 but in the top half of the 1% are all inheritors, with more than 15 million dollars of financial net worth. Working stiffs never get a shot at getting there.
These trust fund babies are not as smart as their daddy or mommy who made the dough. How many children of Nobel prize winners win Nobel prizes? It is called regression to the mean, and these trust fund babies are below average. They control some 50% of all the investments. They reward loyalty not competence. That misallocation of capital is detrimental to all of us. We need to tax estates with more than 5 million dollar worth significantly.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact