Amazon.com, cell phones and the online retailing industry – page 2

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FierceWireless: Where is this information coming from that you're providing, such as descriptions of the phones?

Ryder: We do want to be the authoritative place to learn about new products, whether it's a cell phone or a new TV or a digital camera. So we compile information that we get from the manufacturer, from the carrier and then assemble it in a way that we think is clear and understandable for customers.

You'll see that in this case the images are all very consistent; we are making our own images, and also giving a picture of what's in the box, and giving you a sense of the size of the phone. We're trying to give the customer as much knowledge and information as we can so they can make the right decision.

FierceWireless: How does AmazonWireless decide on phone pricing? AmazonWireless prices are often very different from carrier prices.

Ryder: One of our key tenants is value--selection, convenience and value. So we make sure that we are competitive in our pricing all the time. Retailers set their own prices ... and so when we look at the competitive environment, we set our prices accordingly. ... Carriers set the monthly fee, we set the price of the device itself.

FierceWireless: Best Buy has offered a few exclusive handsets in the past, handsets not available anywhere else. Is this a strategy that AmazonWireless would take?

Ryder: In the past we've been a pre-launch partner, where we launch a product before any other retailer, and we're always open to new opportunities. Our customer base loves new products. They're early adopters of technology; obviously they appreciate new technology because they're very comfortable shopping online, so we're always looking for new opportunities like that.

FierceWireless: How important is it to have exclusive products?

Ryder: We want to be there with what customers want. And what customers tell us that they're interested in. And so if customers said, "Hey, we're really interested in something like that," then, yeah, we'd look into it.

FierceWireless: Amazon.com is the company that offers the wireless e-book Kindle. As the industry moves beyond phones to all kinds of devices--broadband access cards and netbooks and other gadgets--how is AmazonWireless positioned for that transition?

Ryder: I think we are very well positioned. On Amazon.com, we're already selling netbooks with plans. So that's a new business model that's emerged--you can buy a netbook for a very low price when you sign up for two years of wireless data coverage. But I think over time we're going to see a lot of different business models, with service from the carrier to all these connected products. ... When I look across all the consumer electronics categories, convergence is something that the industry has spouted for many, many years ... It's a very important place for us to be and we're going to be there.

FierceWireless: Speaking of the Kindle, Amazon.com also offers a number of mobile services and applications, such as mobile access to Amazon.com's shopping services and a Kindle application for the iPhone. How will these play on AmazonWireless?

Ryder: They're separate. They're basically how you interface with Amazon when you're mobile. There are actually two shopping applications: One is text-based called Amazon TextBuyIt, where literally you just text message Amazon with a product name or a UPC code or an ISBN number, and we'll text message you back if the item is available, and what the price is. There's also Amazon Remembers, which is both an iPhone app and a BlackBerry app, where wherever you are you can take a picture of a product and we'll send you an email ... and say if that product is available on Amazon and what's the price, and you can buy that within the application. ... So mobile shopping is very important to us, it's clearly something we'll continue to experiment with.

FierceWireless: Would you sell BlackBerries with this application installed?

Ryder: Um, well no. I'll give you another example of where we are doing that. For example, on the G1, the Google phone, as well as the Palm Pre, there are Amazon content and applications pre-loaded on those phones, for the Amazon MP3 store. So you'll see examples of that.

FierceWireless: Is it fair to say that AmazonWireless will not install Amazon applications on the phones that are sold through that site?

Ryder: I would just say that we're constantly seeing how we can help customers in the mobile space.

FierceWireless: No more specifics on that then?

Ryder: We don't have any at this time.

FierceWireless: OK, so moving on: As an online retailer, what generally are your views on the wireless market? Where are things headed?

Ryder: I think it's very positive for the wireless business. We all know that the penetration of cell phones in the U.S. market is very high, it's somewhere between 80 and 90 percent, but the majority of that is still the basic handset, and not necessarily the smartphone. ... I think the market for devices that are optimized for more than voice ... that's very bright. And as we've mentioned, with the different business models that will continue to emerge, whether it's a netbook with a plan, and is there something between a phone and a netbook, I think there's just a lot of opportunity.

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