Amazon’s Alphabet Projects Will Face Crowded Markets, Other Challenges

Amazon is expanding their mobile computing products beyond the Kindle Fire line – products that do not come cheap. The Wall Street Journal reports that one such product of Amazon is a high-end phone that displays 3D images without the need for the user to wear 3D glasses.

And that’s just the beginning.

Amazon calls them as the Alphabet Projects – Projects A, B, C and D. Included in the projects are a set-top movie and TV show streaming device, and an audio streaming device. They could be released in the coming months, but no timetable is currently set for any of them. 

The truth is, Amazon will be entering markets that are currently very crowded for their projects, along with having to create additional services for them. For example, the smartphone market is dominated by Apple and Samsung, and Amazon would have to negotiate terms with a wireless carrier. Its 3D screen, rumoured to be powered by Qualcomm chips, might vault them over, but it’s all speculation at this point.

The other projects will be facing a lot of challenges as well. There are already a lot of set-top devices in the market, and Amazon’s own would be redundant with its Instant Video service. In addition, Apple’s Roku sells for below $50. An audio streaming device, on the other hand, would have to be designed to run on Spotify or Pandora to be relevant in today’s market.

Amazon’s projects are creating excitement, but some view it as a natural extension. Amazon is currently trading at $260.16 over a 52-week range of $206.37 to $284.72, with a consensus that the stock price will reach $313.94 next year. Those figures present a 20% return right there if you decide to buy in now. Amazon will surely get there, but probably not yet due to the Alphabet Projects just yet.

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