Amazon's mobile ambitions grow
(Reuters) - Amazon.com Inc (AMZN.O) plans to expand its mobile platform and broaden its offering of devices beyond e-readers and the Kindle Fire tablet, analysts, developers and retail partners said ahead of results next week from the world's largest Internet retailer.
Context & Ripple Effects
Amazon's mobile push builds on more than $1 billion in mobile sales over the preceding 12 months and an earlier focus on extending Kindle through software. Reports that it was testing a smartphone remained unconfirmed, but the broader device plans make the Kindle Fire less of a standalone product and more of a potential entry point to Amazon's mobile platform.
The move also arrives as Amazon expands Prime's video catalog, giving a wider device range a clearer role in distributing Amazon retail and digital services.
First-order effects
- Amazon's developers and retail partners must prepare for a broader device portfolio and mobile platform rather than a product line centered on e-readers and the Kindle Fire.
- Amazon gains more potential customer touchpoints for its retail, app-store and Prime video offerings as it broadens its hardware lineup.
Second-order effects
- A larger Amazon device base raises the value of supporting Amazon's platform for app developers, while making the company more dependent on maintaining a coherent experience across different devices.
- Other device makers selling into Amazon's customer base face a retailer that is also using hardware to control a direct channel for digital content and commerce.
Third-order effects
- If Amazon pairs a broader device range with its retail and content services, mobile hardware becomes a distribution layer for an integrated commerce platform rather than a standalone electronics business.
The trend: Amazon is extending from a Kindle-led device strategy toward a mobile platform designed to tie hardware more closely to shopping, apps and digital media.