Can Amazon Thrive in the Smartphone Market?
Amazon has been a major player in the information technology revolution for more than two decades. From its start as a book seller to a one-stop shop to its leadership in complex technologies and cloud computing, Amazon has almost become omnipresent.
Smartphones is the one area that the world has eagerly anticipated Amazon's branching into. Buzz about Amazon's entry into the mobile market has been around for a while, but now it's official—Amazon will be releasing its smartphone, internally called Project Smith, later this year.
Amazon knows that it is a late entrant in the market. With strong established competition from smartphone OS makers and device makers, Amazon must establish its niche and set a clear unique selling proposition to ensure a significant market presence. We have been hearing about special features such as 3D viewing experience and sophisticated cameras, but will these features alone be enough to entice users away from their existing providers?
The sweet spot could be the very attractive prices for which Amazon is famous. If it can bring exceptional quality and its famous low price points, Amazon could make a big entry in the already crowded and competitive device market. As for the operating system, Amazon is planning to leverage a reworked version of Android, so its risk is slightly lower given the established Android base.
If Amazon is able to make the entry it anticipates, the organization has a few core advantages that can help boost its growth. Amazon already has an Appstore with more than 200,000 applications from its Kindle base. Although this is not as rosy as the positions of Google or Apple today, it is not a completely new entrant and can easily work on increasing the number of apps.
Amazon's other unique positioning compared to other mobile players is how Amazon can use the data it collects from its mobile business to better connect with users across the diverse businesses in which it operates. Data that can now be used to offer better purchase recommendations to users will give Amazon a much needed competitive edge.
There is a current belief that smartphone innovation has stalled, which could give Amazon a chance to enter strong with all its differentiation. Every holiday season is an exciting time because so many new gadgets enter the market, and this year will be even more interesting as we wait to see what Amazon has in store for the ever-hungry smartphone user base.
