Report: Amazon Smartphone Coming in 2012

Plus: Kindle Fire is having trouble connecting

Amazon is looking to add another device to its current line of Kindle e-readers and tablets. But according to Citigroup, it won’t be another Kindle—instead, Amazon is getting into the smartphone game.

In a report released yesterday, Citigroup analysts Mark Mahaney and Kevin Chang said that an “Amazon smartphone may be coming next year.”

Amazon is reportedly developing the phone with Foxconn, while it will be manufactured by TMS. The mid-end device will be made of parts—including a Qualcomm chip and Texas Instruments processor—worth between $150 and $170, suggesting that the phone itself could sell for around $300, although Amazon could subsidize some of the costs to lower the retail price.

But before Amazon branches out into the phone business, it might want to look into a few issues with a device that's already on the market. According to TechCrunch, Amazon’s support forums are full of complaints about the Kindle Fire’s Wi-Fi, with users experiencing “spotty connectivity, disconnections, or an inability to connect in the first place.” Another user said that the tablet’s wireless connection shuts off when the display is turned off, making it difficult to listen to music on the device.

While an Amazon customer service rep suggested simply restarting the device or router, the company hasn’t officially addressed the connectivity issues. “It’s unfortunate that one of the Fire’s big features is that a PC is totally unnecessary, yet for many it seems the first thing they’ll have to do is side-load an update that fixes the Wi-Fi,” opined TechCrunch’s Devin Coldewey.