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'Fire Phone failed because it was overpriced'

India TV News Desk 02 Nov 2014, 15:07:10 PM IST
India TV News Desk

New Delhi: A top Amazon executive has acknowledged that Fire Phone didn't match Amazon's lofty ideas and says the price of the device was "wrong."

Referring to the Fire phone's initial $199 on-contract price tag, Amazon Senior Vice President of Devices David said, “people come to expect a great value, and we sort of mismatched expectations.”

Amazon has since slashed the price to $1 with a two-year contract, and AT&T is even bundling Amazon's Kindle Fire HDX tablet for just $49.

Earlier, the Seattle-based firm released third-quarter financial results which fell far short of expectations. It reported a net loss of $437 million, and Amazon CTO Tom Szkutak disclosed the firm took a $170 million charge "primarily related to Fire phone inventory valuation and supplier commitment costs."

Moreover, customers in their reviews of the smartphone on Amazon's website, have complained of a myriad of problems, including a lack of apps, overheating and poor battery life.

And despite its flop, Amazon is undeterred. Limp said the company will continue supporting the phone through software updates--it has released two major ones already--and pointed out that the Kindle e-reader took several iterations before it became a hit.