If Amazon gives away free smartphones, then what's the catch?

Anna Scantlin
Contributing Editor from  Kansas City, MO
| September 7, 2013

If you want people to like your product, what's the best approach to make it so? By giving it away, of course. Although we find that this isn't always the case in the smartphone world, mostly because even if you find a cell phone priced "FREE" in big, bold letters, you're eventually going to find out that even the cheapest, dinkiest cell phone is "technically" retailed at a hundred dollars or more. You find out that in order to get that super appealing "FREE" price, you need to sign up for a two-year contract where you're probably paying a lot more than you really should be for the plan features you use. But, this industry has pretty much always been this way. Every once in a while we have a rogue carrier that makes a statement by changing it up, like we've seen with T-Mobile, but now things might get shaken up a bit more from retail giant, Amazon.

Although these are very loose rumors, former Wall Street Journal journalists Amir Efrati and Jessica Lessin published a report that cover Amazon's potential plans to release their own rumored smartphone for free. As in, completely free, at least in the traditional sense. Not only is the device supposed to be free initially, but you also wouldn't have to sentence yourself to a two-year contract either. Sounds too good to be true? Maybe, but of course Amazon isn't just going to hand these devices out for free without expecting anything in return. There has to be a catch behind the idea - but what is it?

My initial thoughts are that Amazon would go the route of the Kindle Fire. I have owned both a Kindle Fire and a Kindle Fire HD, and while they were nice pieces of hardware for the price, I wasn't really a huge fan of how Amazon chose to skin Android. It's heavily altered, so much so that Amazon doesn't even offer the actual Google Play store on its tablet, but rather the Amazon App Store. This app store is an alternative to Google's Play Store, which only offers some apps that are optimized for Amazon's Kindle Fire. The plus side is that the Amazon App Store still offers most of the essentials, but the downside is that you're not really getting a full Android experience. Amazon made profit from these tablets through advertisements on the devices. This allowed Amazon to price the tablets about the same price it costs to produce them. So while I didn't necessarily dig Amazon's skinning of Android, I did find the price attractive and could tolerate the advertisements (although I wasn't terribly pleased about the Kindle Fire's "advertisement" lock screen that you could only disable after paying Amazon $15 extra).

But would smartphone users be as tolerant? For the most part we use tablets for functions like media, games and other "side tasks", but phones are something that most people would consider their most important electronic. We use them for both communication and entertainment, and if Amazon chose the advertisement route, how intrusive would they be? If this was any other smartphone, I would tell you that using advertisements to lower the cost of a phone is a terrible idea and not worth it. But if these phones are supposed to be free with no strings attached anyway, I kind of find myself siding with "Why not?" Free is free, and even if I wasn't a fan of the interface there wouldn't really be any repercussions.

Another "catch" that could be considered is perhaps needing to purchase an Amazon Prime membership, which cost $78 a year and gives you access to certain items that offer Prime's free two-day shipping, and also helps with discounts on certain products. Prime is a pretty good deal for people that use Amazon often, but for those who don't and don't plan to, it really would feel like paying $78 for a phone that would supposedly be free. It's still a cheap price for a smartphone, but how much the smartphone is worth also depends on how Amazon decides to execute Android, or whatever software they plan to use, on their device. I presume that in traditional Amazon fashion that they will make the phone very Amazon-centric.

It's certainly an intriguing idea, but I have to say that I'm loving all of these new ideas popping up in the mobile industry. I know I personally would be very interested in a free Amazon smartphone.

But what about you, readers? Would you be interested in a "free" Amazon smartphone, even if it included advertisements, an Amazon-centric UI and/or require an Amazon Prime membership? Do you think this is even possible? Let us know your thoughts in the comments below!

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