Amazon will reportedly launch an Android-based smartphone in an attempt to rattle market leader Apple.
The company is currently working with Chinese technology giant and Apple partner Foxconn on the device, reports Bloomberg.
The internet giant is also aiming to ward off any future attempts at patent litigation by the lawsuit-friendly Apple by acquiring wireless technology patents.
The move would expand Amazon out of its traditional digital entertainment market.
It has already extended into the tablet market with the Kindle ebook reader and Kindle Fire tablet.
It is expected to release the second iteration of its flagship tablet at the end of the year, with the Kindle Fire to debut with a larger 8.9-inch display over its 7-inch predecessor.