Mobile

You Can Get a $50 Phone From Amazon, If You Don’t Mind the Ads

Subsidized by the retail giant, Blu’s good-enough smartphones have become a hit in the U.S. as well as the developing world.

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By Olga Kharif

August 17, 2016 at 5:10 PM UTC

This article is for subscribers only.

This article is part of the August 22, 2016 issue of businessweek.

The smartphone ranked No. 1 on Amazon.com’s list of top sellers isn’t an iPhone or a Galaxy. Its latest version won’t get a big coming-out party. It’s the Blu Products R1 HD, and starting at $100—with Amazon’s subsidies, $50—it’s, uh, good enough.

While America’s wireless carriers are phasing out subsidies for high-end phones, Amazon is tacking the other way. Starting last month, the retailer began offering Prime subscribers the Blu for $50 if buyers are willing to put up with ads on their lock screens. (It’s also selling a similar Motorola phone from Lenovo for $200, or $150 with ads.) Samuel Ohev-Zion, Blu’s chief executive officer, isn’t coy about who his audience is. “They’re not able to afford an iPhone,” he says.