Amazon Fire Phone Slow To Ignite

Web data suggests sales of Amazon's Fire Phone are lukewarm at best.
Amazon Fire: 6 Key Points
Amazon Fire: 6 Key Points
(Click image for larger view and slideshow.)

The Amazon Fire Phone isn't exactly setting anything on fire -- least of all sales figures. It fact, sales of the handset, which hit the market earlier this summer, are barely lukewarm. Analysis of Internet traffic during the first 20 days after the Fire Phone's release shows it accounts for only 0.02% of North American Web surfers. Is it too early to call the Fire Phone a flop?

Chitika Insights examined the online ad impressions made by tens of millions of US and Canadian smartphones between July 25 and August 14. Its data suggests the Fire Phone is selling slowly, though steadily. Chitika described its presence on the Web as "growing incrementally rather than exponentially." The device debuted to mixed reviews, despite whiz-bang features such as Dynamic Perspective and Firefly.

To put the Fire Phone's initial sales in perspective, Chitika compared it to another device released this year and several devices released last year. The LG G3 debuted in the US several weeks ahead of the Fire Phone and garnered mostly positive reviews. Sales of the G3 kicked off July 11 at AT&T, and it reached Verizon Wireless and Sprint on July 17 and 18, respectively. Chitika noticed a relatively sharp increase in the G3's presence on the Web, with spikes popping up on the days it reached Verizon and Sprint. After 20 days, the G3 accounted for 0.06% of North American Web traffic -- about three times as much as the Fire Phone.

[Would you trust Amazon's mobile payment service? Read Amazon Local Register: Friend Or Foe?.]

Chitika pointed out that one factor in the Fire Phone's slow uptake is its limited availability. AT&T is the only carrier anywhere in the world selling the Fire Phone, whereas consumers can buy the G3 from four different US carriers. "While the Fire Phone’s features and brand are both new to the smartphone space, LG likely benefitted from the positive reputation it has built over the years releasing several well-received smartphone models, including last year’s G2," noted Chitika.

Examining sales trends last summer of the Motorola Droid makes the Fire Phone's debut seem less bleak. The Droid series (which comprises three phones: the Mini, Maxx, and Ultra) was sold exclusively by Verizon Wireless. The Droid series saw a similar adoption rate to the Fire Phone over its first 20 days of availability. "In this context, the somewhat mild adoption of the Fire Phone may be seen as an expected consequence given the smartphone’s carrier exclusivity," Chitika concluded.

On the surface, Chitika's analysis seems reasonable. The more widely available a device is, the more likely it is to sell. By limiting the Fire Phone's initial availability to AT&T, Amazon may have unintentionally hindered sales (although it's possible that Sprint, T-Mobile, and Verizon Wireless may have refused to sell it).

Ahead of the Fire Phone's release, Amazon CEO Jeff Bezos said the company planned to be patient. Bezos didn't expect the Fire Phone to be a flash in the pan. Perhaps it's best to think of the Fire Phone as just an ember at this point: It's warm and has potential, but it needs more time to heat up before it truly catches fire.

In its ninth year, Interop New York (Sept. 29 to Oct. 3) is the premier event for the Northeast IT market. Strongly represented vertical industries include financial services, government, and education. Join more than 5,000 attendees to learn about IT leadership, cloud, collaboration, infrastructure, mobility, risk management and security, and SDN, as well as explore 125 exhibitors' offerings. Register with Discount Code MPIWK to save $200 off Total Access & Conference Passes.