Is This Manufacturing Partner BETRAYING Apple?

Following up the relative success of its Android-powered Kindle Fire tablet, Amazon (NASDAQ:AMZN) reportedly has a smartphone in the works that will compete directly with Apple’s (NASDAQ:AAPL) iPhone and Google (NASDAQ:GOOG) Android smartphones.

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Amazon is in the process of seeking out wireless technology patents to protect itself from the sort of litigation that’s rife in the smartphone market, sources familiar with the matter told Bloomberg. Amazon reportedly expressed interest in a set of wireless patents from InterDigital, but lost out to Intel (NASDAQ:INTC), which purchased the intellectual property for $375 million.

Amazon has reportedly tapped Foxconn, one of Apple’s major manufacturing partners, to produce the handset. And an early report seems to give some credence to the claim, as Citigroup analyst Mark Mahaney reported last November that Amazon was working with Foxconn on a smartphone project. Mahaney estimated that the device would cost between $150 and $170 to build and could be sold at cost, as Amazon notoriously undercuts competitors’ pricing with the expectation of making its profit on related services and app purchases.

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