Amazon.com is rumored to be testing a smartphone that could be released in early 2013. But does the online retailer stand a chance against Apple’s iPhone and Google’s Android? One analyst said that an Amazon smartphone may not be the smartest move.
While Amazon’s Kindles and e-readers would give the company leverage in the phone market, Colin Sebastian, R.W. Baird senior analyst, is concerned about the expense.
“Phones are more utility devices,” he said. “It requires carrier distribution and developing apps like maps and search, which are potentially large investments for Amazon.”
If Amazon were to launch a smartphone, Sebastian told CNBC’s “Squawk on the Street” on Friday that R.W. Baird would not automatically downgrade the stock, but the outlook would initially be negative.