Remember the razor/razor-blade model of sales? The idea is that in order to make real money, you don't sell an expensive razor -- you sell the razor cheap or even give it away, and then make your money on the razor blades that the consumer will be regularly buying.
Printer manufacturers have been working on that strategy for a long time. Soon after inkjet and laser printers became standard household items, the price of most standard printers went down dramatically (I suspect that many of them are at or below cost of manufacture). But you could make book on the rule that, if you bought a really cheap printer, you'd be paying high costs for the ink cartridges.
In fact, the last time I invoked this example, I was looking at the smart way that Amazon had dropped the price of its Kindle e-book readers back in 2011. So after reading JR Raphael's review of the new Amazon Fire Phone, my first question was: Why hasn't Amazon picked up that lesson for its new phones?
In case you haven't heard yet, Amazon's Fire Phone has decent but not spectacular hardware and a version of Android that has been tweaked beyond all recognition. In fact, the Fire Phone doesn't even have access to the standard Google apps -- Gmail, Google Drive, YouTube -- nor to the Google Play store that offers the latest iterations of all the other available apps.
In other words, this is a device that is specifically aimed at pushing the owner to buy more stuff via Amazon. Everywhere you look, apparently, there are links to purchase at Amazon; there is even a feature called Firefly that is specifically designed to let you quickly identify an object, a video or a song and immediately buy it from Amazon.
And for this privilege, you get to pay a minimum of $200 for an AT&T phone with a two-year contract.
Now, I'm sure that there are a lot of folks who are invested in the Amazon ecosystem. Heck, I do a lot of shopping at Amazon -- it's quick, it's easy, it's comprehensive, and the prices are usually pretty good. But if Amazon wants to encourage the vast majority of its users -- who may enjoy shopping there, but who aren't married to the idea -- to step up their purchasing habits, offering them a crippled piece of hardware at a medium price isn't going to do it.
So here's my advice to the company, for what it's worth: You want to really push people to use your heavily-Amazon'd phone? Distribute the Fire at a ridiculously low cost -- and then sit back and watch as all those razor blades get bought.