TLDR

Amazon is developing a new smartphone codenamed “Transformer,” its first since the 2014 Fire Phone flop
The project is being led by J Allard’s ZeroOne group within Amazon’s devices unit
AI integration is a key focus, potentially eliminating the need for a traditional app store
Amazon is exploring both a full smartphone and a minimalist “dumbphone” option
The timeline is unclear and the project could still be canceled

Amazon is back in the smartphone game — or at least trying to be. More than a decade after the Fire Phone burned out, the company is quietly working on a new device codenamed “Transformer.” The project is being developed inside Amazon’s devices and services unit, according to four people familiar with the matter who spoke to Reuters.

AMAZON $AMZN IS REPORTEDLY DEVELOPING A NEW MOBILE PHONE, ITS FIRST SINCE 2014’S FIRE PHONE

The latest effort, known internally as “Transformer,” is being developed within its devices and services unit

“The phone is seen as a potential mobile personalization device that can… pic.twitter.com/TwcSkVjiUk

— Evan (@StockMKTNewz) March 20, 2026

The phone is being positioned as a mobile personalization device. It would sync with Alexa, make shopping easier, and act as a daily touchpoint between Amazon and its customers.

Amazon.com, Inc., AMZN

The initiative fits into a long-held vision by founder Jeff Bezos — a voice-driven computing assistant inspired by the communicators from Star Trek. That dream didn’t work out in 2014. Now Amazon is trying again.

What Went Wrong Last Time

The original Fire Phone launched in June 2014 with a $649 price tag and high expectations. It came with a proprietary version of Android called Fire OS, a 3D display system that required four cameras, and a product recognition feature called Firefly.

None of it worked well enough. The phone ran hot, had a limited app library, and failed to convince consumers to leave Apple or Samsung. Amazon slashed the price to $159 before scrapping it entirely after 14 months. The company took a $170 million charge on unsold inventory.

It became one of the most public failures in Amazon’s history.

What’s Different This Time

The Transformer project is being led by ZeroOne, a group formed about a year ago within Amazon’s devices unit. Its mandate is to build “breakthrough” gadgets. It’s headed by J Allard, a former Microsoft executive known for his work on the Xbox and the Zune.

Panos Panay, who heads Amazon’s devices division, is also involved. Panay has been working to turn the unit profitable after years of losses.

AI is at the center of the Transformer concept. The idea is that deep AI integration could remove the need for a traditional app store entirely. Instead of downloading and registering for apps, users could interact through Alexa and AI-powered features built into the device.

OpenAI is working on AI hardware with former Apple designer Jony Ive. Meta, Apple, and Google are building AI-integrated glasses and other wearables. Amazon is entering that race with a phone.

Two Very Different Directions

Amazon hasn’t settled on what kind of phone Transformer will be. The company is exploring two paths: a standard smartphone and a so-called “dumbphone” with stripped-back features.

One inspiration for the second option is the Light Phone — a $700 minimalist device that has a camera, map, and calendar but no app store or web browser. A simpler device could let Amazon market Transformer as a second handset for people who want to reduce screen time, or for parents looking to give teenagers something without social media access.

Feature phones and minimalist handsets made up about 15% of global handset sales in 2025, according to Counterpoint Research.

Amazon has not yet approached any wireless carriers about the device.

A Tough Market to Break Into

The smartphone market hasn’t gotten easier to crack. Apple and Samsung together held around 40% of global sales last year. Analyst Colin Sebastian of R.W. Baird said Amazon will need to give consumers a compelling reason to switch — and consumers are very attached to their existing app ecosystems.

Smartphone shipments are also expected to fall 13% in 2026, according to IDC, as memory chip prices push device costs higher.

The timeline for Transformer remains uncertain. The people who spoke to Reuters cautioned the project could be scrapped if priorities shift or financial pressures mount. Amazon declined to comment.

The post Amazon (AMZN) Is Taking Another Shot at the Smartphone — Here’s Why It Might Be Different appeared first on CoinCentral.

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Filed under: News - @ March 20, 2026 12:29 pm