Amazon is planning to give away its upcoming mobile phone for free, according to reports.
The retail giant is expected to offer customers the gadget free of charge via its website, despite talking to wireless carriers about selling the product through them.
Amazon, which makes the hugley popular Kindle e-reader, could require people to sign up for services such as Amazon Prime in exchange for the phone. Launched in the UK in 2007, Prime delivers products to customers free-of-charge within two days for a flat annual fee. It also allows subscribers in the US to stream selected films and TV shows at no extra cost and borrow certain books from its Kindle library for free.
Amazon Prime costs £49 a year in the UK and $79 a year in the US after a 30-day free trial.
However, Wall Street Journal reporters Amir Efrati and Jessica E Lessin claim that Amazon wants the device to carry no cost regardless of whether people sign up to a wireless plan at the same time as taking the phone. Wireless carriers regularly reduce the price of phones if customers sign up for a one- or two-year wireless contract.
Amazon still needs to seal a deal with a hardware partners to manufacture its phone, which has been rumoured since 2011.
In April the company, which also makes the Kindle Fire tablet, hired former Windows Phone boss Charlie Kindel for an undisclosed project, raising expectations Amazon was making a phone.
“Amazon presented an opportunity to build something new that has ginormous potential. I simply couldn’t pass the opportunity up,” he told GeekWire at the time.
His LinkedIn page stated that he was “hiring cloud and mobile developers and testers, program managers, and product managers”.
Amazon reported a surprise net loss of $7m (£4.5m) in the quarter to June 30, compared with a profit of $7m a year earlier, as revenues grew to $15.7bn. The company has been spending heavily on order fulfilment and digital content rights, which continue to weigh on margins.
For the current quarter, Amazon is forecasting revenue of $15.45bn to $17.15bn.