Amazon Cancels Hardware Projects After Fire Phone Disaster

Amazon’s ambitious entry in the incredibly competitive handset market has been a rather unsuccessful venture and resulted in extremely poor sales. According to the The Wall Street Journal, “dozens” of engineers working at the secretive Lab126 hardware development facility have been laid off. Located in Silicon Valley, the lab is used to design Amazon’s entire range of hardware products including tablets, mobile and TV. Apparently, the majority of people dismissed are those involved in the Fire phone’s development.

This isn’t a surprising revelation given the financial repressions of the Amazon Fire handset’s failure. Only three months after the product’s launch, Amazon accepted a $170 million loss to offset the lost value of the unsold Fire phones. Additionally, the company still had $83 million in its inventory at the end of this period. Even Amazon’s marketing might and huge discounts couldn’t entice people to purchase the Fire handset. Technically, it’s a fairly impressive device but the Fire operating system restricted the amount of apps available compared to Android and iOS handsets.

It’s currently unknown if Amazon will also ditch other more successful hardware projects such as the Fire TV Stick. I doubt this will be the case, as the company tries to compete with the Apple TV and offer a viable alternative to Netflix.

Was there anything in particular which deterred you from buying the Amazon Fire handset?

Thank you Engadget for providing us with this information.