Amazon Working on Kindle Smartphone?

Here’s the most interesting rumor I’ve heard all week: Amazon is working on an Android smartphone, which it will launch in the fourth quarter of 2012.

The speculation was started by a Citigroup analyst whose research note said that “Based on our supply chain channel checks in Asia led by Kevin Chang, Citi’s Taipei-based hardware research analyst, we believe an Amazon Smartphone will be launched in 4Q12.”

According to the note, FIH will be jointly developing the phone with Amazon, while its components will be manufactured by Hon Hai’s TMS group. It will likely use a TI OMAP 4 processor and Qualcomm’s dual mode baseband chip.

It also says, that Amazon may be willing to lose money on the device, and may price it in the range of $150 to $170, to increase sales.

That strategy has often been used by Amazon, as in the case of the Kindle Fire and the Kindle, and it has seen quite a lot of success with it.

The Kindle Fire has been a huge hit, and Amazon may be planning to launch a more powerful 10 inch Kindle Tablet in 2012. There is no reason why it wouldn’t want to disrupt the smartphone market with a Kindle smartphone too.

The note doesn’t specifically mention Android, but given that Amazon has made a lot of investments in Android already, it’s only logical that it would use it on its own smartphone too.

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