What (We Think) We Know About Amazon's Smart Phone Entry

What (We Think) We Know About Amazon's Smart Phone Entry

Differentiation is the key

Will it crash and burn like Facebook's smart phone or soar past Apple like Samsung? There are more questions than answers when it comes to Amazon's presumed entry into the smart phone market later today. But here's what we know so far. Maybe.

Amazon is holding a press conference today in Seattle at 1:30 PM ET. It's not being broadcast live, but the firm has invited some press—and, curiously, some average customers—to the event, so there will be some live, albeit second-hand, accounts of the announcement.

Amazon has never actually admitted that it's announcing a smart phone. But the firm has long been known to have been working on such a device, and the weird promotional trailer for the event indicates—albeit vaguely—that Amazon will be announcing a device. Of some kind. Probably a smart phone.

The single most anticipated feature is a "3D" user interface that apparently uses facial tracking and multiple cameras to provide a more interactive user experience that changes the onscreen display depending on where your face is in relation to the screen. As you move your head around, the screen display animates with you, creating a sense of motion.

Apple currently uses a less sophisticated feature called perspective zoom to achieve a similar effect, but in that case, the display changes slightly when you rotate the device in space. So it uses the accelerometer in the iPhone or iPad, and not facial tracking. The presumed Amazon effect actually does create a sense of "3D," where images onscreen appear to be coming toward the user in space. It was apparently inspired by this YouTube video.

Given Amazon's quirky ways, many had hoped that the firm had broken through the wireless carrier barrier and would sell its device unlocked, and compatible with all carriers. But The Wall Street Journal reports that it will be an AT&T exclusive, meaning it's not so different after all.

Or not: Other reports suggest that the phone will come with a Prime Data plan that will be less expensive than normal AT&T data plans. Perhaps it will provide free access to Amazon's digital media offerings over a cellular data connection.

Examining Amazon's Kindle Fire tablet lineup, you can see how the company intends to differentiate in one key area: Though the phone will most certainly be based on Android, it will not feature Google's expansive Play Store, but will rather use Amazon's more limited store and provide an ad-supported and shopping-heavy user interface. This will appeal to casual users, especially those who are enchanted by Amazon. But it won't go over well with device enthusiasts.

Whatever Amazon does, it will have its work cut out for it. The smart phone market is the biggest technology device market on earth, but it's hotly contested and has settled into a two horse race with true Android devices maintaining a sizable 80 percent to 14 percent advantage over the iPhone. (The remainder is Windows Phone and a few leftovers.)  And while Amazon's tablets have performed pretty well in that market, they are not best-sellers.

So why bother? For Amazon and its driven founder and CEO Jeff Bezos, it all comes down to one thing: Removing the barriers between a customer wanting something and being able to get it—or at least order it—immediately. This is why the company's tablets are ad- and shopping-driven, and why its phone most certainly will be as well. And customers who do buy these products are generally going to spend more at Amazon.com. It is pretty hard to avoid.

More soon.

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