As part of its holiday promotions, Amazon knocks $250 off the price of the unlocked version of its Fire Phone.
Lance WhitneyContributing Writer
Lance Whitney is a freelance technology writer and trainer and a former IT professional. He's written for Time, CNET, PCMag, and several other publications. He's the author of two tech books--one on Windows and another on LinkedIn.
This marks the first time the phone is available unlocked, said Amazon Senior PR Manager Michelle Taylerson. Prior to Tuesday, the phone was available off-contract but tied buyers to AT&T.
The price drop to $199 itself is part of the retail giant's holiday promotion and is just temporary. The sale kicked off on Tuesday and is due to run through Monday, December 1, said Taylerson. After Monday, the unlocked version will return to its regular price of $449.
The unlocked edition of the Fire Phone also throws in additional features, according to Taylerson. Firefly text translation will be able to translate foreign languages into English, French, German, Italian or Spanish. A Firefly wine label recognition will be able to identify that bottle of wine you're thinking of buying, and a Best Shot camera mode will let you pick the best image out of three. Existing Fire owners will receive these additional features in a free, over-the-air update in the coming weeks.
Launched this past July, the Fire Phone has failed to ignite much in the way of consumer interest or actual sales.
In October, Amazon reported a third-quarter loss of $437 million, significantly higher than the loss it took in the same quarter last year. As a result of the phone's poor sales, the company was forced to take a $170 million charge related to the write-down of costs associated with the Fire. That charge accounted for a hefty amount of the overall loss for the quarter. At the time, Amazon had about $83 million worth of unsold Fire Phones, according to Chief Financial Officer Tom Szkutak.
To try to drum up sales, Amazon cut the subsidized price of the phone in September. Initially available via AT&T for $200 with the standard two-year contract, the 32GB version of phone saw its price drop to just 99 cents. The subsidized price of the 64GB edition fell to $100, down from $300.
The Fire has faced a variety of challenges trying to lure customers. Timing was one factor as consumers in July were awaiting the launch of other potentially more enticing phones, such as Apple's Phone 6 and Samsung's Galaxy Note 4. The Fire Phone also failed to tap into the full array of Android apps as it restricted owners to a more limited app store.
Amazon also made an exclusive deal with AT&T to carry the phone in the US, limiting its accessibility. The new unlocked edition of the Fire Phone will expand the potential audience to T-Mobile and other carriers. But the phone is still compatible only with GSM networks, such as those used by AT&T and T-Mobile, leaving Verizon and Sprint subscribers out of the loop.
"There are a lot of reasons it failed, but the key is that Amazon provided no good reason for consumers to buy it," Avi Greengart, an analyst for Current Analysis, said in October.
One of Amazon's goals with the Fire was to provide a portal device through which shoppers could more easily buy other Amazon products and services. Toward that end, the phone itself includes a full year of Prime membership, which separately costs $99. Prime offers free two-day shipping, a large library of streaming videos, and access to Prime music.
Non-Prime members who wish to sign up for the service and buy the Fire would essentially get the phone unlocked for just $100. That sounds like a sweet deal. But with so many other smartphones competing in the marketplace, Amazon is likely to still face a rough time moving many of those unsold Fire phones in just a single weekend.
Update, 11:00 a.m. PT:Adds details from Amazon's senior PR manager.