Amazon’s Fire Phone Lost In The Deep Smartphone Market

Amazon clearly failed to create sustainable demand for its Fire phone and new numbers back the claim putting its U.S. market share at less than 1 percent.

Amazon, the world's largest online retailer, was betting big on its smartphone debut but had an epic failure. Even without the numbers, it was quite clear that the Amazon Fire phone failed to survive in the highly-competitive smartphone market. But now, the numbers prove that the smartphone wasn't the best choice among U.S. consumers. According to the market research firm IDC, Amazon Fire Phone's market share in the U.S. was less than 1 percent during the third quarter this year.

Amazon's market share for its Fire Phone is merely a fraction of what giants like Samsung and Apple secure on a quarterly basis. According to the second quarter results shared by researcher Counterpoint, Samsung had 36.1 percent while Apple secured 29.7 percent of the U.S. smartphone market. On a global level, Samsung had a 78.1 percent of the total global smartphone shipments during Q3 2014 and Apple accounted for 39.3 percent, IDC reported. A Chinese smartphone company, Xiaomi came in third in the global ranking with 17.3 percent during the third quarter.

Amazon launched Fire phone in June and promoted the device's unique capabilities extensively with a flashy press conference and advertising efforts. The smartphone sports a 2.2GHz quad-core processor, Adreno 339 graphics, 2GB of RAM and Android's forked version called Fire OS on top of it as the user interface. The device's unique features include the ability to show 3D images with its "Dynamic Perspective" feature. Despite such features, Amazon failed to pull the audience away from the likes of Samsung and Apple.

Anticipating a huge demand, Amazon procured handsets to fulfill the expected numbers but suffered a loss of $170 million in unsold inventory, Mashable reported. The smartphone was initially priced at $199 and later slashed to $0.99 in September. According to the company's VP of devices, David Limp, the price cut worked out in Amazon's favor.

"We didn't get the price right," Limp said, according to Mashable. "I think people come to expect a great value, and we sort of mismatched expectations. We thought we had it right. But we're also willing to say, 'we missed.' And so we corrected."