Amazon Phone, Potential iPhone Rival, Could Be In The Works, According To Report

With its $199 Kindle Fire, released in November, Amazon has already taken a hefty chunk of tablet sales away from Apple. Could Amazon be planning the same undercutting strategy against the iPhone?

According to a fresh and lively report from Bloomberg, Amazon is "developing a smartphone that would vie with [Apple]'s iPhone" (and other smartphones too, presumably) and is currently loading up on the requisite patents necessary to enter the smartphone business. Amazon's iPhone (aPhone?) could be ready by the end of 2012, or about a year after its disruptive Kindle Fire hit the market, per a report from Citigroup's Mark Mahaney from November of last year.

Though Amazon does not release firm numbers, most analysts estimate it sold about 6 million Kindle Fires in the first quarter after the device's release, which would make the Kindle Fire the second best-selling tablet ever, behind Apple's iPad. The Kindle Fire was inexpensive ($199, compared to $499 for the cheapest iPad) and easy to use, two attributes that could define the success of any smartphone entry from Amazon.

Details of the supposed Amazon phone are scant, though presumably it would easily connect with the Amazon.com storefront and Amazon App Store. Amazon also recently acquired UpNext, a 3D mapping service it could use on the Kindle Fire or its new smartphone.

But how will Amazon attract phone buyers? With the Kindle Fire, Amazon seemed to be selling to those who had never owned an iPad, or could not afford one; but the tablet market was far more untapped than the current smartphone market. How does Amazon entice Android, Windows Phone or iPhone owners away from their current mobile devices of choice?

Like the Kindle Fire, expect an Amazon phone to be cheap. Amazon already has a wireless section on its website, where it sells several popular Android and Windows Phone devices at steep discounts. And we're already seeing a trend of flagship smartphones selling for less than the customary $199 with two-year contracts, with the Nokia Lumia 900 and Sony Xperia Ion starting at $99. Sprint also recently announced that it would offer the white-hot Samsung Galaxy S III for $149 after rebate. Any Amazon phone would likely continue that trend.

What else Amazon can do to seduce smartphone buyers is a mystery. A February survey from Baird Equity Research found that just over 40 percent of consumers would be interested in an Amazon smartphone, should Amazon make one (compare that to 12 percent for a Facebook phone), so the brand image is already there, to some extent. And now we play the waiting game, to see if Amazon CEO Jeff Bezos and company do indeed attack Apple on the smartphone front.

How to read your Nook books on the Kindle Fire

A quick search for the Nook app in the Kindle Fire's Appstore results in absolutely nothing.

The Nook app is available for Android (which is the Fire's OS), but Amazon chose to exclude its competitor's e-reader app from its store.

We don't blame it, but those who are making the switch from Nook to Kindle (or use both) would benefit from access to their old purchases.

After all, it's not like you can sell your old Nook purchases to a used bookstore, right?

Follow the steps to reclaim your Barnes & Noble Nook books and access them on your new device:

Step 1: Go to the Kindle Fire's settings (upper-right) and tap "More," then "Device." Turn "Allow Installation of Applications" to "on." You'll get a warning--just tap "OK."

Step 2: Launch your Fire's browser and head to m.getjar.com. GetJar is one of the best places to get third-party Android apps. At the top of the page, search for "Nook." When you find it, tap Download. You'll be asked to download the GetJar app. Tap "Download GetJar."

Step 3: When the download completes, tap the file in the downloads list (which you can access from your Kindle's top bar), and select "Install."

Step 4: Once GetJar installs, find it in your Fire's app library, open it, and search for "Nook" again. Tap "Download," review the app's permissions, and tap "Install." The Nook app will show up in your Kindle Fire's library.

Head back to the GetJar app anytime you want to download other third-party apps like Google Maps, Dropbox, Facebook, or a different browser like Dolphin HD. None of these apps is available in Amazon's Appstore, but you can download them from GetJar.

Can Devices like the Kindle Fire Finally Pave the Way for a la Carte Cable?

Pundits asking whether the new Kindle Fire will be an “iPad killer” are way off the mark. It's a killer alright, but the victim is not who you think it is. “We don't think of the Kindle Fire as a tablet. We think of it as a service,” says Amazon CEO Jeff Bezos.

And the main competing service in his sights is cable TV.

The Fire, of course, is not the only killer gunning for cable. Amazon's streaming video service is available on dozens of TV-connected devices, including TiVos and Roku boxes. So is Netflix, which although it has stumbled a bit recently, is clearly positioning itself as a streaming alternative to cable. And of course let's not forget Apple, with not just its iTunes movie and TV offerings, but also Netflix on all its devices, including the Apple TV.

(IMAGES: Amazon's Kindle Fire and New Kindle E-Readers)

Cable operators are feeling the heat. Comcast and Time Warner, the two largest operators, have reportedly lost 1.2 million cable TV subscribers in the 12 months ending June 30. Many of these are said to be “cord cutters” who prefer the flexibility of online video, such as Amazon Instant Video, which lets them choose a la carte what they want to watch whenever and wherever they want.

Yet cable prices continue to rise. One reason is the climbing cost of programming itself. Cable companies (like Cox or Charter) pay programmers (like Disney or Discovery) to carry their networks, and in turn they charge consumers. Programmers have been hiking prices for their content, often as a result of access to sports content. ESPN, for example, recently signed a $15 billion, eight-year TV rights deal with the NFL, a 73% increase from their last agreement. That's one reason why the sports network is the most expensive channel to operators, at about $4 per subscriber. Yet the more prices go up, and the more choices like Amazon and Netflix are available, the more we can expect viewers to cut the cord.