Years after the Fire Phone's failure, Amazon is developing a new smartphone: Report

Amazon is once again exploring entry into the highly competitive smartphone market, signaling a renewed push into consumer hardware more than a decade after its earlier attempt failed. According to reports, the company is internally developing a new smartphone under the codename “Transformer,” though the project is still in its early stages and may evolve or even be shelved depending on strategic priorities.

The move places Amazon in direct competition with some of the world’s biggest technology players, including Apple, Google, and Samsung, all of which have already established strong positions in the global smartphone market. However, Amazon’s approach appears to differ from traditional smartphone makers. Instead of focusing purely on hardware specifications, the company is aiming to build a deeply integrated, AI-powered device that can serve as a personalized digital hub for users throughout the day.

The upcoming device is expected to center heavily around artificial intelligence, enabling more natural and seamless interactions. A key component of this ecosystem will likely be Amazon Alexa, Amazon’s voice assistant, which could be tightly integrated into the device to handle tasks such as shopping, media consumption, reminders, and smart home control. However, reports suggest that Alexa may not function as the primary operating system but rather as a core feature layered into the user experience.

Amazon’s vision for the smartphone goes beyond standard app-based usage. The company is reportedly exploring ways to reduce reliance on traditional app stores by allowing users to interact with services through voice commands or AI-driven interfaces. This could represent a shift in how smartphones are used, making interactions faster and more intuitive. The device is also expected to seamlessly connect users with Amazon’s ecosystem, including shopping on its platform, streaming via Prime Video, listening to Amazon Music, and accessing partner services such as food delivery.

This initiative is part of Amazon’s broader strategy to strengthen its position in the rapidly evolving AI landscape, where competitors are already making significant progress. Companies like Apple, Google, and Meta Platforms are investing heavily in AI-powered devices and services. At the same time, OpenAI is also exploring hardware innovations in collaboration with renowned designer Jony Ive, highlighting the growing convergence of AI and consumer hardware.

Amazon’s renewed interest in smartphones comes despite its previous failure with the Fire Phone, which was launched in 2014 under founder Jeff Bezos. The device struggled to gain traction due to limited appeal, high pricing, and lack of differentiation in a crowded market. It was discontinued within 14 months, leading to significant financial losses and unsold inventory. That experience remains a cautionary tale as the company attempts to re-enter the space with a more refined and forward-looking strategy.

The new project is reportedly being led by a specialized team known as ZeroOne, headed by former Microsoft executive J Allard, and falls under the devices division overseen by Panos Panay. The team has been tasked with developing breakthrough hardware products that can stand out in a saturated market. Interestingly, Amazon is not limiting itself to a conventional smartphone. It is also exploring the possibility of a simplified “dumbphone” with minimal features, targeting users who want to reduce screen time and digital distractions. This concept draws inspiration from minimalist devices like the Light Phone, which focus on essential functionality rather than constant connectivity.

The timing of Amazon’s potential entry is notable, as the global smartphone market is facing challenges. Industry forecasts indicate that shipments could decline by around 13% in 2026 due to rising component costs and weakening demand. This makes the environment more difficult for new entrants, especially those without an established smartphone ecosystem.

Overall, Amazon’s renewed push into smartphones reflects its ambition to integrate artificial intelligence more deeply into everyday consumer experiences. While the success of this effort remains uncertain, the company’s focus on AI-driven personalization and ecosystem integration could help differentiate its offering in a crowded and evolving market.