Amazon's Fire Phone won't have an easier time in Europe

The smartphone will struggle to compete with other new devices from Apple and Samsung

Amazon's Fire Phone will soon go on sale in the U.K. and Germany, but finding success in Europe will be even harder than in the U.S., where the phone has struggled to make a mark.

The company has signed deals with O2 in the U.K. and Deutsche Telekom in Germany to start shipping the Fire Phone on Sept. 30.

Amazon's first try at breaking into the highly competitive smartphone market was originally announced in June for the U.S. market, and started shipping in July. It uses Amazon's Android-based Fire OS, has a 4.7-inch screen and a 13-megapixel camera.

The device hasn't had an easy time in the U.S., with Amazon and AT&T dropping the price with a two-year contract from US$200 to $0.99 on Monday. In the U.K. and Germany, the Fire Phone will be free, or cost €1 ($1.30) with a contract. Despite the low price, breaking into the two new markets won't be any easier.

"I think the Fire Phone will be in for a tougher time in the U.K. and Germany. Not only has the phone received poor reviews in the U.S. and has little momentum behind it, but there is also a lot more uptake of Amazon's services in the U.S. relative to the U.K. or Germany," said Daniel Gleeson, senior analyst at market research company IHS.

The bar has become higher for new mobile phone entrants, in general. Consumers are more conservative about their buying choices, as many have already picked and invested in an operating system including the apps and services that come with it, according to Nick Spencer, senior practice director at ABI Research.

"People in particularly Western Europe and North America are, with subsidies, more than happy to pay the money to go for a recognized and trusted brand," he said.

Amazon set out to differentiate the Fire Phone from competing devices with a number of features. They include the "Dynamic Perspective" technology, which allows for one-handed gestures to control the phone and the creation of 3D effects. There is also Firefly, a feature that uses a dedicated button and can identify phone numbers, artwork, songs, TV episodes as well as books and DVDs.

So far, that clearly hasn't been enough. Part of the reason why the Fire Phone has struggled is because the user experience simply isn't yet as good as on competing products, Gleeson said.

The Fire Phone European adventure won't be made easier with the device going on sale at the same time as Apple's new iPhone 6s, according to Gleeson. It will also compete with recently announced smartphones such as the Moto X and G from Motorola Mobility and Samsung's Galaxy Note 4. These devices that are highly anticipated and already have a fan base.

But even though the Fire Phone is off to a tough start, Amazon shouldn't give up, according to Gleeson. The company is very new to the smartphone arena and the Fire Phone is only its first product.

"I expect the next generation will be a vast improvement on the current version. Particularly when it has had time to fix all the bugs and really develop that unique user interface. That interface has a lot of potential, but it hasn't been fully exploited yet," he said.

Send news tips and comments to mikael_ricknas@idg.com

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Mikael Ricknäs

IDG News Service
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