Just like the affordable Kindle Fire tablet, which launched in the US ahead earlier this week, the new smartphone will be cheaper than many rival smartphones and may go on sale for $150-$170, say analysts.
Citigroup says that sources in Asia claim that the new handset will arrive in the fourth quarter of 2012 and will be sold at cost to carriers, with Amazon making its money solely from selling content for the device, just like it does with Kindle Fire, currently sold at a loss of up to $50 per unit.
"With the clear success of the Kindle e-reader over the past 3 years, and Kindle Fire possibly succeeding in the low-priced tablet market, we view this as the next logical step for Amazon," said Citigroup analysts Kevin Chang and Mark Maheney in a report sent to investors.
"We continue to believe Amazon has now set its eyes on the mobile (and tablet) media and product consumption frontier."
Speculation is rife as to the specifications of the smartphone which is likely to run Google's Android mobile operating system.
“We believe the smartphone will adopt Texas Instrument's OMAP 4 processor and is very likely to adopt [Qualcomm's] dual mode 6-series standalone baseband given [Qualcomm] has been a longtime baseband supplier for Amazon's e-read,” said Citigroup.
With Amazon forecasting to sell 5 million Kindle Fire units by year end, a mid-range smartphone does seem like the next logical step for the online retail giant. Amazon, however, has yet to reveal any such device.
Source: AllThingsD
