What does it mean?
Right now, nothing can touch Google Earth - all competing maps lack the precision and functionality of Google’s offerings by a long shot. But the froth and foment is good signaling about a new rush of competition in a space where a new standard may have seemed impossible not too long ago. Competition always pushes performance, so this will be an exciting space to watch.
An Amazon SmartPhone...is an Amazon Cash Register
In addition, analysts are converging around the hypothesis that the Amazon’s purchase of UpNext represents one of the final pieces needed for Amazon to launch a proprietary SmartPhone. If this happens, the firm is expected to be able to sell the hardware at or even below cost, given that the bulk of its revenues come from online sales, not hardware. Imagine the phone or augmented Kindle tabet, and the UpNext map displayed, as a kind of augmented reality cash register. Why would Amazon want you to be able to navigate your own city? To help you more efficiently purchase things you see there.
I attended a talk in 2010 on digital revolution and the future of retail, hosted by the Urban Land Institute. The panelists raised the idea that, based on the ascendance of online retail, bricks and mortar shops could become less valuable, even obsolete as points of sale, unless they provided:
1) a materially higher degree of convenience
2) an experience, a fun event which merited going to the store (ex: the event-ized experience of shopping in times square, shopping in conjunction with music events, shopping with models on Fashion Night Out etc)
See it, Buy it... but Not in the Same Place
The moderator, Chad Stoller (EVP of BBDO), is what many would consider a fringe user or a ‘technology enthusiast’ - he pulled four different mobile devices out of his pockets on the stage and described reading parts of the same book on all of them during one day, as well as on his desktop computer. That was not necessarily normal behavior in early 2010. Stoller also suggested that physical retail also provided a curatorial value, but that the stores did not get compensated for that value - the online retailers did: ie: “I feel bad, because if don’t know what to wear, I go to Barney’s to see what’s cool, but then I order it for less on Amazon... if I don’t know what to read, I go to Barnes and Noble to see which books on their ‘new releases’ table appeal to me, but then I buy them... from Amazon...”
It seemed a little extreme at the time, but by creating a proprietary mobile cash register... er, smartphone, and putting in consumers’ pockets so that it is with them all * the * time, Amazon may be able to establish greater end to end control of a user’s purchasing experience and making Stoller’s behavior much more accessible to mainstream users.
Brad Moon, of InvestorPoint sums it up tidily, calling a possible Amazon phone the "Ultimate Shopping Tool":
“Up to this point, Amazon has relied on apps developed for the different mobile platforms to allow access to its digital content, but with other vendors competing against it with their own e-stores and tying their mobile devices to their offerings, Amazon could get shut out. It already made moves to address this issue in the tablet space with its Kindle Fire, and an Amazon smartphone would be a logical extension of this strategy. In an increasingly mobile world, mapping apps are important. Consumers love them and they’re a big part of local search and mobile ad revenue —Amazon could also tie this into its AmazonLocal service for location-aware deals from its partner businesses. Finally, armed with an Amazon smartphone with barcode scanning functionality and same-day shipping, consumers could walk into any store, quickly scan any item they’re interested in, comparison shop with Amazon (where it would presumably be cheaper), then have it waiting for them when they arrived home.”