The market positioning here seems very un-Amazon. "Your margin is my opportunity" is probably my favorite Bezosism. Given that perspective and Apple's very cushy margins, I expected Amazon not to approach the market with an expensive phone packed with new features, but to approach the market from the bottom, with a good phone that is free or nearly free. The problem, of course, is that Google seems to have that segme…
Why does this seem to be targeted at Android? If anything, I would say the price differential between this and good android phones reflects that it might be more an iphone competitor if anything, and so it seems to be more targeted at Apple.
People that aren't interested in the high end features of smart phones as they are now - people who might even choose a flip phone - but will spend money shopping for traditional items.
Some studies say iOS users (as a whole) are more willing to spend money through their phone than other demographics, but are they willing to spend on what Amazon is selling? This seems to refer mostly to musics, apps.
Cover the internet/messaging basics, offer quick & easy support, make traditional shopping easy - plus add price comparisons and you may tap a large non-tech segment.