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"Rumours of a new Kindle-branded smartphone produced by Amazon are gathering pace, after an analyst said it would be a &amp;quot;logical next step&amp;quot; for the company.  Last year, Amazon expanded its hardware business beyond the Kindle eReader range by launching the Kindle Fire small screen tablet computer in the US.  The online retail giant recently posted bumper quarterly results, particularly on the back of massive popularity of Kindle products in America and worldwide.  Speculation that the company may be working on a Kindle Phone emerged last year. In November, Citigroup analyst Mark Maheny claimed that the firm would release the device in the fourth quarter of 2012. &amp;quot;Based on our supply chain check, we believe FIH [Foxconn] is now jointly developing the phone with Amazon,&amp;quot; wrote Mahaney in a note to investors. Amazon has consistently declined to comment on the speculation. Speaking to Wired, ABI Research Analyst Aapo Markkanen said that a smartphone would be &amp;quot;a logical next step for Amazon&amp;quot;. Like the Kindle Fire, a Kindle Phone would give Amazon a digital platform on which to sell its content, such as eBooks, music, films and Apps - all within the Amazon environment. &amp;quot;The lock-in effect of a great content ecosystem shouldn&amp;#039;t be underestimated,&amp;quot; Markkanen said. &amp;quot;If Amazon builds up a sizable customer base for its devices, and many of those customers find its content offerings appealing enough, then that would mean a tougher market environment for Apple as well.&amp;quot; It is thought that Amazon would take the same approach with its phone as the Kindle Fire; sell the handset at a cheap price, take a thin if any profit margin, then monetise the product through content sales.  Mahaney&amp;#039;s report last year suggested that Amazon would build the phone for between $150 (\u00A392) and $170 (\u00A3104), then sell it to customers almost at cost price. Markkanen agreed with this assertion, saying: &amp;quot;Given that Amazon&amp;#039;s strategy is to treat devices as a content hub rather than a standalone product, it&amp;#039;s pretty likely that price points for the smartphone would be very aggressive.&amp;quot; Such a move would provide a serious competitor for other handset manufacturers using the Google Android operating system. Markkanen noted: &amp;quot;It&amp;#039;s always tough to compete with a rival that doesn&amp;#039;t really care about its own margins.&amp;quot; However, the smartphone market is much tougher than the tablet market, and Amazon could struggle to differentiate the Kindle Phone as a content hub, particularly if Google itself gets deeper into phones after acquiring Motorola Mobility.  Other concerns remain over whether Amazon could persuade Android developers to create apps for the customised Kindle user interface, and whether consumers want the Amazon experience within a smartphone.  Meanwhile, separate speculation has emerged suggesting that Facebook is also pushing ahead with its plans to release an own branded smartphone, as the social network seeks to gain more control over the digital ecosystem. &amp;gt; Facebook &amp;#039;partners with HTC for Buffy smartphone&amp;#039; "^^<http://www.w3.org/2001/XMLSchema#string>
<http://www.digitalspy.com/tech/news/a379540/amazon-smartphone-logical-next-step-for-company/>