The report, quoting people familiar with Amazon's plan, states that unlike the existing scenario, Amazon would be releasing the free smartphone without any compulsory wireless plan. In the US, telecom operators usually discount the price of devices when consumers sign up for one or two year wireless contracts, in the bid to recover the price of the device in longer run.
The report suggests that Amazon may give away the free smartphone under the condition the customers would have to pay for services like Amazon Prime, the company's loyalty programme. The report claims that though Amazon is in talks with wireless carriers about offering its phones, other sources within Amazon, however, point out that the smartphone may also be directly given away to customers on the website. There are no confirmed details as to how the smartphone would be available to the customers and exactly when the device would be available.
But if the plans fructify, this might have a big impact on the smartphone market. In a market where high pricing is an issue for most smartphone makers today, this move by Amazon can prove to be huge industry disruptor. Though several factors like Amazon's negotiations with hardware partners would decide whether this move sees the light of day, yet the speculations clearly show the company's plans to undercut rivals and grab meaningful market share.
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