The One Failure That Changed Amazon Forever

The Fire Phone didn’t create a 3D image the same way movie theaters and 3D TVs do — you didn’t need a special pair of glasses to give rise to the effect. Rather, the phone’s selfie camera came equipped with head-tracking technology that turned and rotated the onscreen image in response to your head movements, creating an onscreen effect akin to looking down a street, according to a 2014 preview by TechCrunch. While early reviews praised the device’s novel technology, consumer interest failed to ignite. However, even if it had, the Fire Phone had another fatal flaw — its price.

Historically, one of the keys to Amazon’s success has been to stay highly competitive on price by sacrificing some (but not a lot) in terms of quality. At a time when top-of-the-line smartphones like the iPhone and Samsung Galaxy cost $200 with a two-year contract, Amazon’s decision to also charge $200 pitted the Fire Phone against a field of top-shelf competitors Amazon had no business challenging. The Fire Phone’s price tag tells another part of the story, too: just months after it debuted, Amazon tried to liquidate its remaining inventory by dropping the Fire Phone price to $0.99 per handset. But by then, it was too late.