Calling Jeff Bezos - Amazon Planning Kindle Smart Phone?

Amazon is rumored to be planning a Kindle mobile phone. Mark Mahaney of Citigroup reported in a recent research note that Amazon could be coming out with a Kindle smart phone as early as the fourth quarter of next year.

According to a report about the rumor in AllThingsD, Amazon may be selling the phone for close to what it costs to build - $150 to $170, Mahaney estimated. (Why would Amazon want to have a near zero-margin phone? It may make sense if the device makes it easy for users to shop its sites.)

Unlike most mobile computing tablets such as the Apple iPad and Samsung Galaxy Tab, the Kindle comes with free wifi, since consumers use it to download media such as books (and now movies) and then consume offline. That makes the device attractive to a broader segment.

With a smart phone, Amazon users might find a data plan necessary, and that would put an Amazon smart phone in a much more competitive space than its current Kindles, which compete with the Barnes & Noble Nook.