Amazon will release Fire Phone 2 rather sooner than later, according to familiar sources. Although the company’s first handset may not have succeeded in meeting the initial sales estimates, the retailer promises more affordable price and more improvements for Fire Phone 2.
In an interview for Fortune, David Limp, Amazon’s Senior Vice President of Devices, admitted that Amazon has set the price tag of the Fire Phone too high. With its first handset, the company did not follow its tradition to price its devices lower compared to its competition. Instead, the retailer followed high-end pricing range similar to that for iPhone 5, HTC One and Samsung Galaxy S smartphones. Limp, added that Amazon failed to meet consumers’ pricing expectations saying that the company “didn’t get the price right.”
However, Amazon’s Senior Vice President of Devices also states that as soon as the company realized its mistake, it quickly took steps for correcting it. In September, the retailer surprisingly cut down the contract starting price of the Fire Phone from $199 to just $0.99. Limp also disclosed that this decision managed to boost the sales of the smartphone.
Despite these bumps, Amazon was willing to expand its Fire Phone lineup by releasing new handsets in the future. However, Limp did not reveal when exactly consumers can expect new smartphones from the retailer. The company’s Senior Vice President of Devices also shared that Amazon.com will pay extra attention to the consumer feedback it receives for the Fire Phone. Nevertheless, he informed that the company is planning to release updates for a number of the device’s software features in the near future.
A few days ago, Tom Szkutak, Amazon’s Chief Technology Officer, informed that Amazon currently has a surplus of unsold Fire Phones estimated at $83 million. In addition, Szkutak reported that the company had $170 million charge that was connected to the write-down of costs related to Amazon’s first smartphone product.
Although the Fire Phone is not among the top-rated cell phones on Amazon.com, its new pricing of $0.99 with a two-year contracts has secured it a spot among the best sellers in contract cell phones.
