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Price conscious consumers are already drawn to android. Even if a free amazon phone was a decent android device it's unlikely that apple would care. And if it

by pdenya 14y ago

Price conscious consumers are already drawn to android. Even if a free amazon phone was a decent android device it's unlikely that apple would care. And if it runs android isn't that still good for Google? tl;dr - If amazon releases a phone it'll be android, low cost and good enough.

seiji 14y ago
It's not about the device, it's about the service. Amazon could grab 30 million customers instantly with this plan: If you take these ideas to their logical conclusion, it's not hard to imagine Amazon pulling the biggest move of all: giving away a pretty good smartphone, along with unlimited voice + data, completely free.
- pdenya 14y ago
  My point was mostly that it won't effect apple as much as the article (headline) seemed to think. I'll still be buying the best equipment, not the cheapest.
- runako 14y ago
  Since the author didn't feel compelled to even sketch the economics of how Amazon could do this, we have to assume he has no idea if/how this would even work. Given that, why not also assert that Apple and Google and Microsoft could give away smartphones free with unlimited voice + data? In a world where unlimited voice + data + low-cost phones can profitably be given away free, why would Amazon be the only company able to do so?
  - seiji 14y ago
    It was fairly plainly stated in the article: So what is Amazon's secret weapon in the smartphone battle? I'm betting it will be Jeff Bezos' favorite play: miniscule margins + massive patience. Apple makes most of their money from the consumer at the time of device purchase; their media and app businesses are low-margin service lines that feed and sustain their high-margin device sales. They way they see it, if they hold on to that customer relationship long enough, they'll always make up the lost margin in customer lifetime value.
    - runako 14y ago
      That's not economics, that's magic. For comparison, note how the author indicates specifically Apple's economic strategy: make money on device sales + encourage more device sales by making less money on media and apps Note that all of the numbers in the Apple strategy are positive. There's nothing comparable for his Amazon suggestion. "Miniscule margins + massive patience" works when price > 0, for all existing Amazon product & service lines. Applying that formula using negative margins doesn't work. It's one thing to say Amazon can make money on volume by selling TVs for razor-thin margins. It's something entirely different to suggest they can make money giving away $200 smartphones + $350/yr voice & data plans free in perpetuity. That's the part the author conveniently skips over.
      - seiji 14y ago
        Oh, I see where you're coming from. You're right if we limit the ecosystem to just phones, phones, phones. But, Amazon is kinda everything in the frigging world. The amazon phone would (obviously) tie to your amazon account. You could instabuy anything. They would make buying things from Amazon a first class feature of the device. Having the device (much like having Amazon prime) would mean you most likely spend more through Amazon. I admit it's a magic fairy dust line of thought, but it's still quite compelling. Suru, I need more toothpaste by Friday. Same kind as last time, sir? Yes, Suru. By your command.
CurtHagenlocher 14y ago
If Amazon uses the open source part of Android without actually joining whatever program Google has for manufacturers, then it's not clear how it would be good for Google. (Such a scenario would probably also prevent Amazon from advertising it as an "Android phone".)
- mc32 14y ago
  At this point it'd be too early to know if "Amazon" phone would have less cachet than "Android" phone, to most phone users. Since kindle has a pretty good brand they could call it the Kindle phone. Altho that would take with it some unwarranted/disconnected association. (long battery life/monochrome)

by pdenya 14y ago

seiji 14y ago

It's not about the device, it's about the service. Amazon could grab 30 million customers instantly with this plan: If you take these ideas to their logical conclusion, it's not hard to imagine Amazon pulling the biggest move of all: giving away a pretty good smartphone, along with unlimited voice + data, completely free.

pdenya 14y ago
My point was mostly that it won't effect apple as much as the article (headline) seemed to think. I'll still be buying the best equipment, not the cheapest.
runako 14y ago
Since the author didn't feel compelled to even sketch the economics of how Amazon could do this, we have to assume he has no idea if/how this would even work. Given that, why not also assert that Apple and Google and Microsoft could give away smartphones free with unlimited voice + data? In a world where unlimited voice + data + low-cost phones can profitably be given away free, why would Amazon be the only company able to do so?
- seiji 14y ago
  It was fairly plainly stated in the article: So what is Amazon's secret weapon in the smartphone battle? I'm betting it will be Jeff Bezos' favorite play: miniscule margins + massive patience. Apple makes most of their money from the consumer at the time of device purchase; their media and app businesses are low-margin service lines that feed and sustain their high-margin device sales. They way they see it, if they hold on to that customer relationship long enough, they'll always make up the lost margin in customer lifetime value.
  - runako 14y ago
    That's not economics, that's magic. For comparison, note how the author indicates specifically Apple's economic strategy: make money on device sales + encourage more device sales by making less money on media and apps Note that all of the numbers in the Apple strategy are positive. There's nothing comparable for his Amazon suggestion. "Miniscule margins + massive patience" works when price > 0, for all existing Amazon product & service lines. Applying that formula using negative margins doesn't work. It's one thing to say Amazon can make money on volume by selling TVs for razor-thin margins. It's something entirely different to suggest they can make money giving away $200 smartphones + $350/yr voice & data plans free in perpetuity. That's the part the author conveniently skips over.
    - seiji 14y ago
      Oh, I see where you're coming from. You're right if we limit the ecosystem to just phones, phones, phones. But, Amazon is kinda everything in the frigging world. The amazon phone would (obviously) tie to your amazon account. You could instabuy anything. They would make buying things from Amazon a first class feature of the device. Having the device (much like having Amazon prime) would mean you most likely spend more through Amazon. I admit it's a magic fairy dust line of thought, but it's still quite compelling. Suru, I need more toothpaste by Friday. Same kind as last time, sir? Yes, Suru. By your command.

CurtHagenlocher 14y ago

If Amazon uses the open source part of Android without actually joining whatever program Google has for manufacturers, then it's not clear how it would be good for Google. (Such a scenario would probably also prevent Amazon from advertising it as an "Android phone".)

mc32 14y ago
At this point it'd be too early to know if "Amazon" phone would have less cachet than "Android" phone, to most phone users. Since kindle has a pretty good brand they could call it the Kindle phone. Altho that would take with it some unwarranted/disconnected association. (long battery life/monochrome)