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Or is it the other way around: they're giving up on "FireOS" and just going to let Google do the work?

Good idea. Most people would probably be happier on a more stock Android with the Google Play Store.

my bet is they fired a few too people and now maintaining it is a burden

Big news if fifteen years ago

Why would they?

Full chain control, I suppose, there are rumours about Vega OS. https://www.androidauthority.com/android-14-based-fire-tvs-3...

If that's the case, it's a bad idea, Amazon is not prepared to maintain their own OS.

they'd probably be better off setting a pile of money on fire instead