Amazon taking hefty losses over flagging Fire Phone sales

[First published on IT Pro Portal]

International commerce corporation Amazon has announced that it will be taking a $170 million (£105 million) charge “primarily related to Fire Phone inventory valuation and supplier commitment costs”. Essentially the company has revealed that their new Fire smartphone hasn’t lived up to the hype.

The Fire arrived on the market at around £3385 per model, but in America a similar price was slashed to just 99 cents if the phone was bought with a two-year subscription.

According to Re/code, Amazon CFO Tom Szkutak labelled the new phone “a good device in a very competitive market” – outlining his belief that the device needs time to settle into the consumer mindset.

It may be a case of wait and see for Amazon, which packed the Fire Phone with a number of extra features and add-ons. Everyone who snaps one up gets free year-long subscription to Amazon Prime, the premium two-day delivery service popular on Amazon’s website.

Getting users onto a Prime program may well be key to Amazon’s profits, as studies have found that those on the Prime program spend around twice as much as those without it.

Whether Amazon pushes ahead in developing a new Fire Phone is yet to be seen. It’s possible that the company might want to pick a more aggressive price strategy, as the iPhone 5S and Galaxy S5 were its main competitors in the market for price.

Jeff Bezos told Re/code that Amazon’s job is “to build the greatest device we know how to build”, maybe they should try again?

Tech news roundup – 14/05/2014

Aaaand I’m already late the party. I was in Amsterdam yesterday attending a meeting so I didn’t have the time or the Wi-Fi to get a good tech news roundup in.

At any rate I hope you haven’t missed me too much and are ready to dive into some choice news!

Samsung have made a bit of a blunder in revealing the specs and looks of their new tablet the Galaxy Tab 6 in a filing to the FCC in the US.

Facebook has said that it wants to open an office in China despite the company’s social network being banned in the country since 2009.

In a landmark ruling, search engines in Europe will be liable for the data that is shown by their results. Google has been successfully brought to court over failing to remove a man’s credentials.

As always, here’s the rest:

Samsung Galaxy S Tab specs revealed in FFC filing

Apple WWDC 2014: iOS 8, iWatch and OS X 10.10

Security being left in the dust amidst rising cloud adoption

AWS adds professional exams to cloud certification scheme

OpenStack Marketplace aims to clear up open-source confusion

Facebook wants to open an office in China by 2015

Office iPad apps top 27m downloads in 6 weeks

Box to light up General Electric with cloud collaboration

Google has to delete private data, says EU court

Samsung Galaxy S5 ships 10 million units in 25 days

IBM CEO outlines 10-year growth plan for Big Blue

Amazon CTO: focus on the customer to aid cloud adoption

Heartbleed bug still a threat after flawed patches

Apple iPhone 6 release set for August?

Data breach leaves Bitly accounts compromised

Met Police to trial body cameras

Apple waves goodbye to US sales head and PR chief

Is Microsoft planning a smartwatch?

 

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