When it comes to the Fire Phone, Amazon made several huge mistakes that were easy to spot at the time of the phone’s release. Now Fortune reports that Amazon is owning up to one of them, as Amazon exec David Limp tells the publication that the device’s initial $200 on-contract price was way too high, especially for a company like Amazon that is known for offering killer deals.
“We didn’t get the price right,” Limp said of the phone’s limp sales. “I think people come to expect a great value, and we sort of mismatched expectations. We thought we had it right. But we’re also willing to say, ‘we missed.’ And so we corrected.”
Limp explained that Fire Phone sales started to perk up once Amazon cut its on-contract price to just $0.99, although there are reasons to believe that the device would have bombed even if it had cost just under a buck right out of the gate.
The device entered into a crowded market where Apple and Samsung have long been the dominant players and smaller players like LG, HTC, Nokia and BlackBerry have all been reduced to fighting for scraps. It lacks the comprehensive app ecosystem of many Android phones because Amazon forks the device and thus doesn’t give you access to popular Google apps such as Gmail, Maps and YouTube. It’s also an AT&T exclusive, which inherently limits the device’s reach as many people don’t want to be tied to two-year contracts anymore.
So while it’s good to see Amazon admit that it got something wrong with the Fire Phone, the device has a lot more problems than just its price that Amazon should look to correct by the time it releases the Fire Phone 2.