Amazon already sells its own tablets - will it add a smartphone to its portfolio?

Amazon said to launch 3D enabled smartphone

Amazon is expected to launch its own smartphone during an event in Seattle, aiming to reinforce its position in the electronics market.

The company, which started off as an online book seller declined to comment, however, most of the industry analysts are in agreement the new product, to be unveiled at the secretive event on Wednesday, is most likely the first Amazon smartphone.

Since its inception, Amazon has branched into many areas including music, video or cloud computing. The company also sells its own tablets and the Kindle e-readers.

Industry insiders believe the anticipated smartphone may be equipped with multiple cameras to produce 3D photos and will feature an Amazon shopping app.

"It's Amazon. That says to me the core value proposition is going to be about shopping," said Ramon Llamas of research firm International Data Corporation.

Amazon's phone comes at a time when the e-commerce giant is at a crossroads.

Its stock, which surged for years despite narrow profits, has dropped 18 per cent in 2014 to about $326 (£192.80), in part because investors have been losing patience with its habit of ploughing revenue back into new ventures.

Analysts said the move into smartphones was a bit of a head-scratcher, since the company was a late entrant into the highly competitive market.
For all its success with other products, Amazon will be hard-pressed to compete with Samsung and Apple, the number one and two mobile phone companies in the world.

Globally, Samsung led mobile phone manufacturers with 31 per cent of the 288 million units shipped in the first quarter, followed by Apple at 15 per cent. In the US, Apple dominates with more than 37 per cent of the 34 million units shipped, with Samsung close to 29 per cent.

Analysts said the phone could also come with a data plan that could let owners use Amazon services without using up any data.

"Anything that generates more repeat orders and more frequent purchases is probably part of what they intend to do with this," said RW Baird analyst Colin Sebastian.

To compete, Amazon needs more than an expected 3D viewing feature, which has been tried before by smartphone makers like HTC and LG,  Llamas said.

Competing on price would not help if it left people with the impression that the device was cheaply built, and getting customers to buy a phone without being able to touch it first could prove difficult, he said.

"If they sell it only online, as Amazon sells many of its goods and products, that could be a challenge," Llamas said.

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