Recently, Amazon widened its stake in the mobile device market with the release of the Kindle Fire, its hybrid e-reader and tablet computer. It may be planning to move even more deeply into this field, specifically by entering the cell phone and smartphone accessories market with a smartphone, rumored for a late 2012 release.

According to Reuters, this information came from Citigroup, which reported that Amazon may be working on this project with Foxconn International Holdings Ltd. Foxconn is rumored to be overseeing the engineering aspects of the purported device's manufacturing process, while production will rest with Foxconn's largest affliate corporation, Hon Hai Precision Industry.

Citigroup's research report elaborated on the reasons why Amazon might be entering the cellphone market. "With the clear success of the Kindle e-reader over the past three years and Kindle Fire possibly succeeding in the low-priced tablet market, we view this as the next logical step for Amazon," the report stated, according to the news source.

The Citigroup research went on to state that the device would be a mid-end smartphone, with production costs per unit estimated between $150 and $170. No information currently exists regarding any features or smartphone accessories that will be compatible with the product.

A recent study by research firm IHS claims that Amazon spends slightly more on the Kindle Fire's production than it charges for the device, according to USA Today.