Within three years Amazon will come out with their own phone. It will be the same game plan that they used with the Fire and gear it towards the low end. Eventually they will go towards the high end.
Phones don't make sense in Amazon's model at all to me. Of course, I could be wrong, but unless it's driving sales of Amazon products, like the Kindle does, there's no incentive.
To quote Bezos himself, "We think of Kindle Fire as an end-to-end service"
http://techcrunch.com/2011/09/29/bezos-in-the-modern-era-of-...
At the end of the day, maybe I'm just arguing semantics, but the fact remains that this isn't a "tablet" in the same light as other Android "tablets." It's a bit of a subtle difference, and I think it's that difference that is crucial and will spell massive success for the Fire. Their ability to sell it at what I assume is a sizable loss isn't hurting their chances either.
Apple and Amazon are in the same space but came from two different sides. And Apple is trying to cover the "harder" side, which is server and cloud computing. While Amazon had that down before diving into consumer HW.
I do think they are missing an opportunity without a camera. Think about the opportunity to scan bar codes or book covers and instantly see the Amazon price, and purchase right there. Imagine being in Barnes and Nobles and buying the book on your Fire.
The smaller screen isn't ideal as a tablet for most media but people still do use it. The phone is the main way most people have access to the web.
I'm not making the case for a WebOS acquisition, just an Amazon phone. It just seems like there is a hole in Amazon's product offerings if a phone isn't available.
It's an extremely competitive, painful market. MS are struggling, Palm have already tried once and failed. Amazon is taking another approach (having their own AppStore on Android) and it's working out for them.
Hardware was Palm and WebOS's weak spot. An Amazon acquisition could be many things, but I very much doubt it's a play for any hardware gains.
Certainly, if they consider themselves competitors to Android Tablets, it would make sense to get the OS under their control, while perhaps ensuring a certain level of compatibility for app porting, etc.
I don't see anything undoubtedly about it. The celluar phone market is a quagmire.