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At a press event on Thursday, Amazon(s amzn) is widely expected to launch both an updated Kindle Fire tablet as well as a new e-ink reader. Those may only prepare the stage for an Amazon smartphone, however. Sources tell The Verge that Amazon will show off a smartphone of its own that follows the same strategy as the Kindle Fire: Use Google’s Android(s goog) platform as a software base and build your own interface to sell goods on it.
Alleged details are slim, but what has surfaced makes sense: Android 4.0 and Nokia Maps(s nok) for location services. At this point Amazon can’t use Google Maps if it builds atop its own custom Android build, so Nokia’s mapping solution is a perfect fit. The only way Amazon could use Google Maps is if it also used Google’s other software, such as Gmail, Google+, YouTube, etc… It didn’t do so on the Kindle Fire, so it didn’t have to pay Google for those apps and Android itself is free to use.
Moving into smartphones may not appear a good idea on the surface. After all, the competition is fierce. But having a smartphone of its own puts Amazon’s services directly on all four screens: Connected televisions, computers, tablets and, if the rumor is true, handsets. Each screen is tied together by both a user’s Amazon account and Amazon’s Whispersync technology, making it easy to view content across all four screens.
If Amazon does launch a phone, my gut says it will take an approach similar to what Google tried with the original Nexus One: Sell GSM phones direct and allow customers to pick their own service and SIM cards. And I’d also bet that in keeping with Amazon’s tradition of reasonable pricing, any such smartphone will be sold at an attractive price point, even at or just below Amazon’s cost.