Right product, wrong time? Amazon is reported to be developing a new smartphone, its first since 2014, and, according to industry tracker IDC, it will face entrenched competition with better products and a market that is expected to contract by double digits.

“Amazon is unlikely to build a better smartphone than Apple, Samsung, or leading Chinese OEMs,” Francisco Jeronimo, vice president of client devices with IDC told The Register via email. “Competing on hardware or traditional user experience is a losing game. On the other hand, according to IDC, the smartphone market is expected to contract 13% in 2026 due to the memory shortage crisis, making it the worst possible time to launch a new device.”

News of the Amazon smartphone was [1]first reported by Reuters . It said that the phone is known internally as “Transformer” and would sync across other Alexa smart devices while also putting Amazon shopping at the center of the experience.

[2]

There was no price or a timeframe for when the phone might be released.

[3]

[4]

Amazon had no comment.

BezosCorp's previous foray into the smartphone race was the Fire, which released in 2014 to underwhelming sales and quickly got cancelled.

[5]

The new device is being developed by an internal Amazon unit known as ZeroOne, which has former Microsoft exec and early Xbox impresario J (no period) Allard at the helm.

The team is also reportedly working on a “dumb” version of the phone for customers who wish to scale down their screentime. One reference has been the LightPhone, which has a camera, phone, and GPS, but no browser.

Jeronimo said that while there is plenty of talk about digital detoxes, it appeals to a small cohort of customers and the actual number of units sold is "negligible."

[6]

“These are viable niches for small players, but not for a company of Amazon’s scale and expectations,” Jeronimo said. “Amazon cannot justify entering a market for tens of thousands of units when its business model requires a significantly larger impact.”

[7]Amazon insists AI coding isn't source of outages

[8]Amazon tells FCC to bin SpaceX's million-satellite datacenter dream

[9]If you're one of the 16,000 Amazon employees getting laid off, read this

[10]Amazon's $200 billion capex plan: How I learned to stop worrying and love negative free cash flow

Jeronimo said that one area where the phone could succeed is as an AI device. While those have also faltered, with notable crashes of the R1 Rabbit and [11]Humane AI pin, Amazon could lean into the agentic conversation using the phone as a conversational, predictive, and service-driven interface, he said.

“In that context, the competitive battleground moves away from hardware toward ecosystems, AI capabilities, and service integration,” Jeronimo said. “This is where Amazon could have an opportunity: it brings together a powerful services ecosystem spanning commerce, content, cloud, and an existing AI foundation with Alexa, along with deep expertise in data-driven customer engagement. Few companies operate at this intersection on a comparable scale.”

But the window is closing fast, as rivals are all moving in this direction including Apple, Google, Samsung, and OpenAI which has iPhone designer Jony Ive building … something.

“This will not be an uncontested opportunity,” Jeronimo said. “So while an Amazon device strategy makes sense in an AI-centric world, execution risk is extremely high, which will make this device a potential dead-on-arrival. Under Panos Panay, Amazon has the leadership to rethink its hardware strategy, but the real challenge is not execution; it is choosing the right category where it can deliver meaningful, defensible value in an AI-first world.” ®

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[1] https://www.reuters.com/technology/amazon-plans-smartphone-comeback-more-than-decade-after-fire-phone-flop-2026-03-20/

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[7] https://www.theregister.com/2026/03/10/amazon_ai_coding_outages/

[8] https://www.theregister.com/2026/03/09/amazon_petitions_to_block_spacexs/

[9] https://www.theregister.com/2026/01/29/amazon_layoffs/

[10] https://www.theregister.com/2026/02/17/amazons_200_billion_capex_plan/

[11] https://www.theregister.com/2025/02/19/hp_acquires_humane/

[12] https://whitepapers.theregister.com/