Amazon Stock: Will This 1 Flaw Kill the Fire Phone?

Three Fools consider whether the new handset will be catalytic for Amazon stock.

Jun 22, 2014 at 4:30PM
Firephone D Right App Grid

The new Fire Phone has a fatal flaw that could prevent it from driving revenue and boosting Amazon stock. Credit:

The new Fire Phone has the makings of a top-notch handset, but is it capable of taking sales from the iPhone and Galaxy S5? Will it will drive long-term gains in (NASDAQ:AMZN) stock? Guest host Alison Southwick puts this question to Fool analysts Nathan Alderman and Tim Beyers in this week's episode of 1-Up on Wall Street, The Motley Fool's Web show in which we talk about the big-money names behind your favorite movies, toys, video games, comics, and more.

Tim says the phone boasts a number of cool features powered by four front-facing cameras, but in most other respects it's like any other smartphone. It even looks like every other smartphone. If you're buying, it's probably because you like the idea of having immediate access to Amazon wherever you are. Or maybe you just like having a phone with a purported 3-D display.

Either way, Tim says, Amazon isn't pitching features so much as convenience via an image-based catalog called Firefly. The idea is simple: Point the Fire Phone at something, and it tells you what it is and how to buy it Amazon. All that's missing is a mobile payments option, for those moments when you're shopping and what you find isn't available online. Amazon would still get a cut of the transaction.

Nathan agrees, arguing that everything Amazon does is designed to get you to spend more money at Amazon. That includes a free, one-year trial of Prime for Fire Phone users who choose to take advantage. A smart move when you consider that Prime members tend to spend more than twice as much as non-members, making them a huge source of profits. If the Fire Phone helps bring in a rush of new Prime members, it'll be a win.

Yet that's anything but guaranteed at this point. Nathan says it's always better to bet on the companies that help customers do great things. The Fire Phone isn't that sort of product. Rather, it's a marketing tool for persuading users to do what's best for Amazon. Tim agrees.

Now it's your turn to weigh in using the comments box below. Do you believe the Fore Phone will drive profits and boost Amazon stock? Click the video to watch as Alison puts Nathan and Tim on the spot, and then be sure to follow us on Twitter for more segments and regular geek news updates!

Apple's next device could snuff the Fire Phone before it sparks ... here's your chance to see it
Apple recently recruited a secret-development "dream team" to guarantee that its newest smart device was kept hidden from the public for as long as possible. But the secret is out, and some early viewers are even claiming that its everyday impact could trump the iPod, iPhone, and the iPad. In fact, ABI Research predicts that 485 million of these devices will be sold per year. But one small company makes this gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and to see Apple's newest smart gizmo, just click here!

Alison Southwick has no position in any stocks mentioned. Nathan Alderman owns shares of and Apple. Tim Beyers owns shares of Apple. The Motley Fool recommends and owns shares of and Apple. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

©1995-2014 The Motley Fool. All rights reserved. | Privacy/Legal Information