Tuesday, February 21, 2012

Amazon set to launch smartphone in Fourth Quarter of 2012AD - The App Economy and the Increasing Importance of Digical Content


Ever since CitiGroup analyst Mark Mahaney claimed that Amazon was possibly working on a US$200 smartphone as stated in the article “Amazon’s smartphone”, published November 18, 2011 3:13 AM, Bloomberg, NY Post and “Amazon smartphone 'in the works'” published 7:09PM GMT 18 Nov 2011 by Katherine Rushton, Media, Telecoms and technology editor, The UK Telegraph, my imagination has been fired up.



More intriguing is the possibility that Amazon may launch it in the Fourth Quarter of 2012AD and be manufacture by FoxxConn as stated in the article “Amazon may launch a smartphone in Q4 2012: report”, published Fri Nov 18, 2011 12:48pm EST, Reuters.

This speculation began in November 2011AD. It has now ratcheted up ever since Amazon declared its Earnings Call on Tuesday January 31st 2012AD to have increased thanks to the Amazon Kindle Fire as stated in the article Kindle Fire stokes interest in Amazon earnings”, published January 30, 2012 6:36 AM PST by Larry Dignan, CNET News.

According to the article “Kindle sales boom, though Amazon sales and outlook disappoint”, published January 31, 2012 1:31 PM PST by Larry Dignan, CNET News for the entire 2011AD, earnings were up by 41% compared to 2010AD with earning of US$631 million. Earnings for the Fourth Quarter of 2011AD are up by 35% compared to the Fourth Quarter in 2010AD with earnings of US$177 million.




Amazon clearly had a great Fourth Quarter of 2011AD based on their Earnings Call on Tuesday January 31st 2012AD!

Clearly the Fourth Quarter increased was buoyed by the Amazon Kindle Fire, but fell below that projected by analysts due to what to expect in terms of the profit margin loss of approximately US$2.70 per Kindle Fire sold.


Apparently not, based on the pre-Amazon analysis of Stifel Nicolaus analyst Jordon Rohan as stated in the article “Kindle Fire sales strong in Q4, but no match for iPad”, published January 30, 2012 5:00 AM PST by Don Reisinger, CNET News. The analyst pre-Amazon Earnings Call on Tuesday January 31st 2012AD upped the ante by stating that Amazon had sold approximately six million (6,000,000) Amazon Kindle Fires, half of the total number of Android Tablets sold.

This is comparable to the 5.5 million (5,500,000) estimated by Barclays analyst Anthony DiClemente  as stated in the article “Time to Stoke Those Kindle Fire Sales Estimates”, published January 9, 2012 at 3:30 am PT, by Peter Kafka, All Things Digital. Both of these estimates, which Amazon has yet to confirm, are nonetheless far below the sales figures of the Apple iPad which sold 15.43 million Apple iPads in the same Fourth Quarter of 2011AD.

Clearly, despite being cheaper, Amazon has a lot of catching up to do if they are to beat Apple….assuming that is their intention. This as the success of their Amazon Kindle Fire demonstrates the increasing importance of Digital Content to both Apple and Amazon.

Most interestingly it also demonstrates the importance of the so-called App Economy, which according to analyst TechNet as stated in the article “App economy creates nearly half a million US jobs”, published February 7, 2012 By Trevor Mogg, DigitalTrends  and Study credits 'app economy' with 500,000 U.S. jobs”, published February 7, 2012 10:15 AM PST by Lance Whitney, CNET News.



The App Economy, the driving force behind the success of Apple, Google and Amazon for both Apple iOS and Google Android mobile devices, has in the past four (4) years created over five hundred thousand (500,000) jobs for Developers, Software Engineers and other support staff and surprisingly, most of them are located outside of Silicon Valley.

Jamaica stands to benefit from this App Economy too by virtue of being able to write Freemium Gaming Apps using Scotia VISA Debit Cards as the receiving Payment Method as stated in my Geezam Blog article entitled “How to use Scotia VISA Debit Card Online

So an Amazon branded smartphone this Fourth Quarter of 2012AD is not so far fetched after all as per speculation in Kelroy’s Geezam Blog article entitled “Amazon to give birth to family of Android devices?”. I had even pointed out this possibility in my pre-Amazon earning call in my Geezam Blog article entitled Amazon sells 5.5 million Kindle Fires in Fourth Quarter 2012 – Apple iPad sales drop and plans January Press Event” that Amazon may not just debut one smartphone but two (2) smartphones!

The possible specs would really make this smartphone duet of :

  • Basically smaller version of the Amazon Kindle Fire
  • Running on Google Android OS 4.0 aka IceCream
  • Featuring the Cloud-enhanced browser Silk, with possibly one of the smartphones being entirely Cloud Based
  • Both priced below US$200 outright purchase, with no mobile device contracts but requiring a Data Contract
  • Built in Wi-Fi Calling as described in my blog article entitled “Telecom Providers 4G vs Wi-Fi Calling - Galaxy Rangers
  • Curated Google Android App Store, again more support for the App Economy!

Smartphones possibly named Amazon Blaze (what happens when a Fire gets out of control) and Amazon Starfire (what happens when a Gas cloud in Outer space ignites to create a star) as hinted in my Geezam Blog article entitled Amazon sells 5.5 million Kindle Fires in Fourth Quarter 2012 – Apple iPad sales drop and plans January Press Event” may sound farfetched.

But given Amazon previous success thus far with its Kindle line and its pre-Madonna the Amazon Kindle Fire, the support of the App Economy and the increasing importance of Digital Content, an encore come the Fourth Quarter of 2012AD is very likely.
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