DOJ makes ridiculous claim that the iPhone caused the Amazon Fire Phone fiasco
Going through the actual DOJ filing of its civil lawsuit against Apple, it appears that the government is really stretching to make some of its accusations fit. The Justice Department, along with 16 state and district attorneys general, claims that Apple has monopolized the smartphone business. To prove this point, the suit accuses Apple of placing barriers to prevent some companies from entering the smartphone business.
Thanks to Bloomberg's Mark Gurman for pointing out in a tweet just how ridiculous some of the government's claims are. For example, the suit alleges that Apple's monopolizing ways are behind the failure of the Amazon Fire Phone. The suit says that Amazon released the Fire Phone in 2014 but could not "profitably sustain its business and exited the following year." Huh? The Fire Phone died of its own accord.
First of all, the Fire Phone used a forked version of Android and did not feature the Google Play Store. That alone probably kept a large number of consumers from purchasing the device. Amazon sold only 26,000 units overall and wrote off $170 million of unsold inventory. The phone was originally priced at $200 on contract and AT&T cut the price to 99 cents with a signed two-year pact. The Fire Phone was an AT&T exclusive which also limited sales of the device.
The DOJ makes some wild claims against Apple
The truth is, Apple and the iPhone had absolutely nothing to do with the poor performance of the Fire Phone, possibly the second worst smartphone launched after the BlackBerry Storm. Certainly, the iPhone had nothing to do with Amazon's decision to exit the business the following year.
The Amazon Fire Phone was a flop, but not because of Apple or the iPhone
The DOJ also blamed Apple for Microsoft's failure with Windows Phone (which was all about Microsoft's inability to get app developers to write for the platform), and the inability of HTC, and LG to remain viable smartphone manufacturers. HTC and LG's problems had nothing to do with the iPhone and had everything to do with Samsung's domination of the high-end Android market.
The DOJ's suit goes on to say that, "Today only Samsung and Google remain as meaningful competitors in the U.S. performance smartphone market. Barriers are so high that Google is a distant third to Apple and Samsung despite the fact that Google controls development of the Android operating system."
Perhaps the DOJ and the 16 state and district attorneys general that filed the suit need to understand that Amazon was behind the failure of the Fire Phone, Microsoft's failure to get app developers to create a well-stocked app storefront led to the demise of Windows Phone, and Samsung's superior Galaxy S line doomed HTC and LG. HTC also failed to equip its phones with decent cameras and used smaller capacity batteries on its high-end handsets.
You can find the lawsuit right here. Go to paragraph 186 to see the amazingly ridiculous claims by the DOJ.
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