Amazon's New Phone Supercharges Showrooming

Register now Inc.'s Fire Phone, unveiled today, has a button that blends mobile purchasing with real-world shopping.

The feature, called Firefly, uses the phone's microphone and camera to identify any real-world product the user observes. Consumers who practice showrooming, the concept of visiting a store in-person to view a product before buying it online, can use this feature to buy items from Amazon after scanning them in person.

In a demonstration at the phone's unveiling, CEO Jeff Bezos demonstrated how the phone could identify a jar of Nutella and bring up the food's product page and rating on Firefly has a dedicated button that bypasses the phone's lock screen to access the feature.

Firefly is sophisticated enough to recognize a specific episode of a TV show by hearing the audio from it, Bezos said, according to live reports from Ars Technica and Re/code, which attended the product demonstration.

Firefly can identify 70 million physical items that can be purchased on, the e-commerce giant says in a press release. It can also recognize 245,000 movies and TV episodes, 160 live TV channels and 35 million songs. The phone also has NFC and Bluetooth, two technologies used in contactless mobile payments.

"There are a lot of ways Amazon can go with this, maybe eventually wrapping a mobile wallet around it," says Brian Riley, senior research director and analyst with Boston-based CEB TowerGroup.

In many ways, Amazon has a stronger trove of customer data and shopping habits than Apple does, Riley says. Apple has 800 million iTunes accounts, most of which have a payment card attached.

"Amazon has inserted itself as the hub for its merchant base, and it keeps the payment relationship in place," Riley says.

Amazon is also launching a Firefly software development kit to allow companies to build on the functionality. iHeart Radio, for example, developed a system that builds a playlist around a song scanned by Firefly, Bezos says.

The Firefly system can also read bar codes and QR codes, technologies common in mobile payment applications.

Firefly is the latest of many tools in Amazon's growing payments arsenal. The company's recent moves include a "guest checkout" system called Login and Pay with Amazon that allows shoppers to use their credentials at other e-commerce sites; a Twitter shopping feature that lets people make purchases from by replying to tweets; and Amazon Coins, a virtual currency used to purchase digital content for Amazon devices such as the Kindle Fire tablet.

The Fire phone will launch exclusively on AT&T, a move reminiscent of the iPhone's 2007 launch on AT&T only.

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