Why an Amazon Smartphone Could Work and a Facebook Phone Might Fail

In the world of rumors the Facebook phone has played peekaboo over the past couple of years. Now it's been revived, with the claim that it will be made by HTC. The idea here is deep integration of Facebook and its various social features into a modified Android handset.

However there have already been a number of "Facebook phones": 

None of these handsets sold particularly well as far I'm able to tell. And with the wide availability of Facebook apps and a good mobile website, there's really no reason to buy a "Facebook phone," unless it's got some really compelling features or is super cheap.

It's difficult for me to imagine what those features might be. I'm over 40 but for younger audiences, the idea of a phone deeply integrated with Facebook might be exciting. Privacy and tracking would be another potential concern for me with a Facebook phone. 

Radically cheap would also be the main reason to buy an Amazon smartphone. With Kindle Fire as the model, one could imagine the e-tailer aggressively subsidizing its handset to the point of zero consumer cost up front (one could also imagine an ad-subsidized model). That would be the reason it could potentially succeed: if it were extremely inexpensive or free, combined with Amazon's content and storage offerings. 

However if it were to compete without such near-total subsidies, on equal footing with other Android handsets, the outlook for the Amazon smartphone is considerably diminished. 

Another, radical scenario for Amazon would involve it becoming an MVNO (on the Sprint network) with dramatically reduced data plans paired with its hypotehtical phone.