Amazon acquired 3D mapping startup UpNext yesterday, GigaOm reports.The acquisition brings a native maps app to the Kindle Fire tablet. Users previously had to buy a third-party app or access mapping services through the browser. Furthermore, with the release of the Google Nexus 7, Amazon may have felt the need to revamp the Kindle Fire’s product offerings.
It’s also the latest sign to point to the development of an Amazon phone. While there have been rumours and reports of a forthcoming phone, Amazon has stayed characteristically mum about any major mobile play.
But while the use cases for maps on a tablet like the Kindle Fire are fairly limited, a mapping service is absolutely essential for a mobile phone.
There have been other clues over the last year as well:
- Amazon bought Yap last November. Yap creates voice-recognition software, similar to Apple’s Siri or the new Google Now. The current incarnation of the Kindle Fire does not have a microphone.
- Amazon will start selling prepaid wireless service in Japan. We wrote at the time that “this looks like an experiment that could presage an Amazon phone.” Amazon could differentiate themselves in the smartphone market by charging low prices, heavily subsidizing the phones, and making money of software and content offerings.
While a phone may not initially seem in line with Amazon’s ecommerce DNA, the potential revenue opportunities are in many ways a natural extension of its core online business:
- Media sales: eBooks from a Kindle app, music from Amazon MP3, movies and TV shows from Amazon Prime.
- Software sales: the Amazon Appstore has been a huge success on the Kindle Fire. Developers make almost as much revenue per active user as they do on iOS. Given strong early results, Amazon shouldn’t have a hard time convincing developers to bring their apps to an Amazon phone.
- Mobile ads: Amazon has the potential to be a huge force in mobile advertising. It probably has more data on consumption habits than any company in the world—exactly the kind of information advertisers crave.
- Ecommerce: Mobile commerce is just getting started, but Amazon will undoubtedly play a huge role in its development. For example, if consumers are increasingly using their smartphones while shopping in retail stores, shouldn’t Amazon offer consumers an easy way to buy these products at a cheaper price on their phones.
We still don’t know for sure if Amazon is developing a phone, but it has taken several steps in the past year that indicate a big mobile push could be on the horizon. With the potential revenue opportunities at hand, an Amazon phone is a logical extension of its vaunted ecommerce business.
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