Amazon unveils ‘Fire,’ its first smartphone by Tom Huddleston, Jr. @FortuneMagazine June 18, 2014, 2:03 PM EST E-mail Tweet Facebook Google Plus Linkedin Share icons After months of rumors, Amazon finally announced its entry into the smartphone market at an event in Seattle Wednesday. CEO Jeff Bezos spoke to a crowd made up mostly of members of the media to announce the online retail giant’s newest product: the Fire phone, a device with a 4.7-inch screen, a quad-core 2.2 GHz processor and 2 gigabytes of RAM. The new smartphone also features a 13-megapixel camera that can be launched by pressing a designated button on the side of the phone, and Amazon is offering free, unlimited photo storage on the Amazon Cloud Drive. As had been rumored, the phone is being offered in an exclusive partnership with AT&T and can already be found on the company’s website, starting at a price of $199.99 for a two-year contract with the 32-gigabyte model. For a limited time, Amazon is also offering a year-long Amazon Prime membership along with the new phone. MORE: What today’s Amazon announcement is really about After offering up info about the Fire’s physical specs and some of its features, including the new image recognition service Firefly, Bezos finally confirmed rumors that the new product has 3-D capabilities, in a sense. Bezos introduced the phone’s motion-tracking screen, which uses “dynamic perspective” head-tracking technology that relies on four corner-mounted infrared cameras to make images appear to be three-dimensional without the need for 3-D glasses. Bezos demonstrated how that technology can be put to use, making images on the phone’s display look more realistic while also registering the user’s face and head movements to cycle through Amazon products while shopping on the phone. To be sure, Amazon is aiming the new technology at Amazon Prime members to encourage them to buy more of the company’s products online. Users will also be able to tilt the phone to navigate the Fire’s maps feature and to initiate “auto-scroll” while reading a news article or Kindle book. Amazon’s AMZN stock price, which remained relatively unchanged at the start of Wednesday’s event, rose more than 3% following Bezos’ announcement. VIDEO: Amazon smartphone will be exclusive to AT&T News of a potential Amazon smartphone with 3-D capability leaked earlier this year, with BGR even posting photos it claimed featured a prototype for the new product. Amazon added fuel to the fire earlier this month when it released a promotional video featuring several people’s amazed reactions to an unseen product. The people in the video can be seen tilting their heads back and forth while using the product, which added to speculation over the phone’s head-tracking technology. Amazon is pushing the Fire to current and potential Amazon Prime subscribers, who will be able to use the phone to access streaming video and the newly-launched Prime Music, a music streaming service launched on Monday that lets Amazon Prime members listen to more than one million songs without interruption from ads. One of the phone’s main features is Firefly, an image recognition service that can identify text and images as well as audio and video. Bezos said users can use Firefly, which has its own designated button on the side of the device, to scan phone numbers, books and even works of art to get information and save it on the phone. Firefly can also recognize songs and television shows, or offer nutritional information for food. MORE: Amazon’s new phone and the rise of the Internet middleman The phone also includes Mayday, a tech support feature that connects users via video stream to support staff. In addition to teasing the release of its new product with vague hints at what was to come, Amazon has been touting the increased selection in its Amazon Appstore. Amazon said earlier this week that it has nearly tripled its apps selection in the past year, to 240,000, a number that signals impressive growth, but which is still about one-fifth of Apple’s app offerings. Amazon also reached a licensing deal with Blackberry on Wednesday to make all of its apps available on the latter’s new line of handheld devices set to launch this fall. One person who isn’t too excited about the partnership between Amazon and AT&T is T-Mobile CEO John Legere, who unleashed a Twitter rant against the new product a day before it was even announced. Legere came out against the exclusive partnership, tweeting that “Exclusivity sucks for customers,” while comparing the new Amazon device to the failed Facebook-HTC smartphone that flopped last year.