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Why Amazon is launching a smartphone

Wednesday, June 18, 2014 - 01:18

June 18 - Despite its late entry, Amazon could grow the smartphone market overseas and use the phone to spur more sales of its catalog of products, say analysts. Fred Katayama reports.

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Amid the amazonian hype, Amazon's finally expected to unveil its first smartphone and take on Apple and Samsung. Look for it to sport a 3D screen that won't require you to wear those nerdy glasses. Here's why the Johnny-come-lately is jumping in. Amazon's cheap hardware like tablets and e-readers drive sales of its huge catalog of products. The smartphone could also score with the loyal customers of its free two-day shipping service, Prime. Topeka Capital Markets analyst Victor Anthony says, "We see an opportunity for Amazon to help grow the smartphone market. Amazon's devices drive digital content sales, but more importantly, drive Prime subscriptions, whose members purchase more frequently and in greater dollar amounts than non-Prime members." What's more, consumers are increasingly using smartphones to buy things. Online audience tracker comScore says mobile commerce grew at nearly twice the rate of desktop sales in the first quarter. And while Apple and Samsung dominate the U.S. market, there's plenty of room for smartphone growth overseas. So, while the BlackBerrys and Motorolas have taken a licking, Amazon's late smartphone move may not be dumb.

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Why Amazon is launching a smartphone

Wednesday, June 18, 2014 - 01:18