Analysts believe an Amazon Android smartphone is in the works

We know that Amazon has several Android tablets planned. They recently released the Amazon Kindle Fire tablet and they have larger models in the works, but if Citigroup’s analysts Mark Mahaney and Kevin Chang are correct, we could be looking at a release of an Amazon Android smartphone by the Christmas of 2012.

This information comes from “their supply chain channel checks in Asia”, but as to how accurate are their sources remains unclear, so we will just have to take this at face value for now. According to the analysts, Amazon’s Android smartphone offering will be a mid-ranged phone that will cost around $150-$170 to manufacture. It seems that Amazon will be adopting the same strategy that they employed for their Kindle Fire, which is to sell the phone below cost to encourage adoption.

Will their information pan out? We guess we will have to wait and find out, but for now let’s hear your thoughts on a possible Amazon Android smartphone. While a tablet makes sense due to its ability to double as an e-reader (due to its larger display), what will Amazon’s Android smartphone offer that will set it apart from the competition, aside from its price?