Last year we covered news that Amazon was thinking of entering the wearables space. The future of that mysterious, unannounced product is now in question following layoffs and restructuring at Amazon’s Silicon Valley hardware development center, lab126. Despite the recent successes of Dash (the WiFi connected reorder button) and Echo (a connected speaker with virtual assistant), the complete failure of the Fire Phone hit the company hard. In Q3, 2014 Amazon took a $170 million charge on inventory and supplier commitments, disclosing that the company was sitting on $83 million of Fire Phone inventory. Largely in reaction to that massive failure, for the first time Amazon is laying off employees at lab126.
The layoff are part of a restructuring effort resulting in large number of projects being shelved. Some of the canceled projects have leaked to the press and include
a projector, a large tablet, and a connected stylus. Future phones are not off the table, but are on hold indefinitely and development will be moved to Seattle. Among the projects that were saved are a kitchen computer, a glasses-free 3D tablet, and high capacity Kindle battery. Absent from both lists is anything that sounds like a wearable, so the future of that product is still unknown. Without a successful Amazon phone to connect to, the Amazon wearable would need to enter a world where it would compete with Android Wears, Apple Watches, and Olios. I would be curious to see how well an Amazon device could compete but imagine that it would be a challenge for the company. Also, Amazon’s products largely exist to help sell goods, I am not sure a standalone wearable device would effectively achieve that. If you are an avid Amazon fan and love their tablets, all you can do is hope that the company’s wearable survived the restructuring.
