If you were in Jeff Bezos shoes would you buy the smartphone chip
business of Texas Instruments (TI) who currently supply them with processors
for their Kindle tablet?
It’s an interesting question and one that Isreali finacial
newspaper Calcalist claims is in advance stages of talks today.
So you start of selling books on the Internet, extend that to
media, open it up to create a marketplace, then to a wide range of other products,
move to become a publisher and deal direct right back to manuscript, launch
your own ereader, move into cloud based services, continue to grow both
organically and by acquisition, into a one stop shopping emporium. The question
is how far do you go technically? Does the ownership of the processor design
give you better integration and lower cost base?
Amazon is becoming harder to define but increasingly focused on
creating that vertical total experience. They start with the products and
service and move to encircle the total experience. Apple on the other hand
start with the device and work back to the product. Which approach makes more
sense and is easier to develop? The two things we are joining together is the
creator and the consumer and Amazon clearly have that chain increasingly covered.
Apple still are consumer and technology bias. Amazon has built an impressive
walled garden but has also enabled others to participate all be it often only
on their terms. Apple remain entrenched in their walled garden.
The other player of interest, is Google and their approach to
building Android and then effectively sub licensing the technology devices
interface to others. Their approach is again different but their vision of
being at the top is the same.
Three different routes three different players.
We don’t envisage seeing Amazon not moving for the likes of TI’s processors.
It makes good sense to own the design through to the delivery and to not merely
knit the technology together. Is Amazon capable of managing such operations –
why not? Will it deflect Amazon – we doubt it.
So will Amazon extend its device range to includes smartphones,
ereaders and tablets – why not?
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