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. “We can’t compete head to head with Apple,” says a high-level source at Lab126. “There is a branding issue: Apple is premium, while our customers want a great product at a great price.”
The Fire Phone failed not only because it was expensive, but also because its standout features were silly gimmicks, and everything else was just nondescript and boring. You can’t sell gimmicky, nondescript, and boring for that kind of money.
Strip the phone down to a midrange smartphone. Price it at $249, no discounting. Drop the free year of Prime. Phone is priced to be sold at a profit, not subsidized.
Now make Amazon into MVNO cell phone operator like Tracfone ( or OEM from them, Walmart does). Costs would then be low enough to include a free low-end voice/data plan with Prime. So instead of a receiving a free year of Prime phone owner would buy it to get the cell plan.
Sell additional voice/data minutes at a profit via Amazon.
If you could get a free basic smartphone plan as part of Prime the phone would sell like hotcakes.
Bezos built the phone he wanted, not what the middle class wants. Bezos is not your average consumer.