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Once again, there’s word that Amazon is working on a smartphone, this time from Bloomberg. And given the success of the Kindle Fire so far, which has been the only Android tablet worth buying since its debut (the Nexus 7 now holds that title), it’s not surprising to think Amazon would want to get into the smartphone arena as well.

But I can’t imagine Amazon would simply spit out a smartphone without any further innovation.

Considering it’s already one of the best sources for smartphone deals on the web, I think it’s just a matter of time before Amazon starts reselling wireless data services on its own as well. Even without its own phone, reselling wireless service would make Amazon the one-stop shop for practically any mobile device. And if it’s prepaid, the service would be particularly enticing for tablet users, or anyone who doesn’t want to sign up for yet another cellular contract.

Offering prepaid cellular service wouldn’t be a huge stretch for Amazon. The company has offered its “WhisperNet” service since the very first Kindle, which uses Sprint’s EVDO network to offer anytime data connectivity to its e-readers.

Amazon has proven itself adept at being a step ahead of the competition with the Kindle, Kindle Fire, and its ubiquitous cloud computing services. Offering its own wireless service would definitely give it a leg up on practically all other mobile device manufacturers — even Apple — which still have to deal with traditional carriers.

According to the Bloomberg report, Amazon is said to be working with Foxconn (which also manufacturers the iPhone and iPad) on the phone. Just like the Kindle Fire, I’d expect Amazon to power the phone with a tweaked version of Android. The company has also been buying up wireless patents to protect itself from the wave of patent litigation sweeping the mobile market.

“My guess is that Amazon will indeed come out with a smart phone, but it will be much like Fire – tied to Amazon content and services, and may even include an e-wallet for purchasing from Amazon,” said Jack Gold, principal analyst at J. Gold Associates. “That is where they made their money, not in the sale of the device itself. So expect it to be aggressively priced (again, like the Fire model).”

“As for reselling wireless, this is a bit more iffy,” Gold added. “Amazon could certainly become an MVNO – there are lots of carriers that would work with them. But I don’t see any real reason for them to do so other than account control. There is not a lot of profit to be made as an MVNO (the carriers make most of the money). If I were Amazon, I’d just provide an unlocked phone and let the buyer pick a SIM for whatever carrier they want. Amazon will make plenty of money on the services, and they won’t have to guess which carrier to provide users that will offer the best service in their location.”

The last time we heard rumors of Amazon building a phone, I wasn’t too excited about the idea. After all, why would Amazon want to jump into the overcrowded Android phone market? But given just how well the Kindle Fire has done, as well as the clear need for a simple prepaid wireless service in the mobile world, an Amazon phone all of a sudden becomes a much more interesting prospect.

Design is determining the winners in everything mobile. The most successful players are focusing on one thing: How to make products, services, and devices as compelling and delightful as possible – visually, and experientially. MobileBeat 2012, July 10-11 in San Francisco , is assembling the most elite minds to debate how UI/UX is transforming every aspect of the mobile economy, and where the opportunities lie. Register here.

Filed under: mobile, VentureBeat

Apple will release a 7- or 8-inch iPad that will disrupt the low-end tablet market before the end of the year, a new Bloomberg report claims.

We’d heard previously that Apple was purchasing 7.1-inch screens for smaller iPads and later, John Gruber — Apple’s biggest fan — said a 7.85-inch iPad was being developed.

But while those rumors have been fun to speculate on, the prospect of the “iPad mini” has never been more believable than it is now because of the Google Nexus 7 tablet. The $200 Nexus 7 is the best Android tablet we’ve seen yet, and it beats out the Kindle Fire, Samsung Galaxy Tab 2, and other 7-inch tablets with its powerful hardware, Google Play access, and Android 4.1 “Jelly Bean” operating system.

Bloomberg’s report also notes that the iPad mini will not feature a Retina display in order to keep costs down and says it will likely debut in October, which is when is when we expect Apple to announce the next-gen “iPhone 5.” An iPad mini would most likely carry a price between $200 and $300 to stay competitive.

Let us know in the comments if you’d be interested in buying an iPad mini.

iPad mini concept photo: CiccareseDesign

Filed under: mobile

Apple’s flagship service iTunes is in for a much-needed overhaul, according to a Bloomberg report that cites unnamed people familiar with the matter.

The changes are said to include further integration with its iCloud cloud storage service and increased sharing functionality in regards to music, with heavier integration with Twitter and Facebook. The report indicated that Apple was interested in getting permission from music labels to enable features that would allow a user’s friends to listen to purchased songs for free. Google’s Google Play Music app already allows this, but users can only listen to songs a limited number of times.

The company is also planning to improve content discovery on iTunes, with purchases of both music and video. Rival Google just released its own set of discovery features that will largely debut with the latest version of its Android operating system. So, clearly, Apple understands that it’s lagging behind in this fight.

While the iCloud integration will probably increase the number of people using iTunes, the music sharing is something that’s long overdue — especially with the rise of social streaming music services like Spotify. Bloomberg’s sources stated that the music industry is also urging Apple to launch a subscription-based all-you-can-eat music download model. Since this would likely decrease Apple’s media sales revenue, it’ll probably never happen.

The changes are expected to roll out before the end of the year, which would be nearly a decade after iTunes first launched.

Filed under: cloud, media

Microsoft’s recently announced Surface tablet may only be available with Wi-Fi connectivity when it launches later this year, according to a Bloomberg report that cites  unnamed sources familiar with the matter.

The Surface already faces heavy competition from Apple’s iPad and Android-based tablets from Samsung and Motorola, all of which have pricier 3G/4G-enabled models in addition to Wi-Fi. If Bloomberg’s report is correct, then Microsoft likely decided it wasn’t worth trying to compete with the high-end level devices.

Honestly, that’s probably a very smart move for Microsoft’s first-generation tablet. While plenty of people may purchase a 3G/4G-enabled iPad, studies have shown that they don’t take advantage of it — regardless of if they pay the extra monthly data bill to a wireless carrier. A mere six percent of all data usage on iPads came from cellular data, while Wi-Fi data accounted for 89.3 percent, according to a Localytics report released in March. That said, anyone thinking of buying a Surface isn’t going to be put off by the lack of 3G/4G functionality.

But there could be other reasons why Microsoft decided against a 3G/4G Surface model. First off, it would have had to negotiate with wireless carriers prior to the announcement, which would have increased the probability for news of the device to leak out. That’s a minor factor, because if partnering with carriers on Surface data plans was crucial to the company’s strategy, it wouldn’t have paused. The more likely explanation is that the low-end model Surface’s retail price is already higher than the competition.

Microsoft didn’t announce the Surface’s retail prices during the company’s launch event earlier this week. Yet, TheNextWeb is reporting that pricing will range from $599 for the low-end 32GB Windows RT model to a whopping $999 for the Windows 8 Pro model. For that kind of money, shoppers will be looking at specs sheets to determine if its worth the price when there are cheaper options out there.

Lets start with the low-end. Samsung’s 10-inch Galaxy Tab 2 is $399, and Apple’s least expensive tablet is the $399 Wi-Fi only 16GB iPad 2, which doesn’t have the gorgeous Retina Display or optimum hardware inside. If you want a Surface, you’ll already have to justify spending $200 more. And remember how everyone was in love with the Surface’s seamless integration with Windows 8 desktops earlier in the week? Well, these consumers probably won’t have a Windows 8 PC, so that’s not really a selling point. Apple’s Wi-Fi only iPad 3 runs $599, which is comparable to the 32GB Surface in price, but lacks the prettier display.

Now lets turn to the high-end Wi-Fi only Surface for $999, which could potentially face competition from lower-priced, super portable Ultrabooks. There are a few advantages of having a tablet, sure. But I doubt potential first-time tablet shoppers will go with the unknown, more expensive option when presented with the choice between a $999 Surface or a $799 -$899 Ultrabook.

Do you think Microsoft Surface will face tougher competition because of the rumored $599/$999 retail prices and lack of 3G/4G data? Let us know in the comments.

Design is determining the winners in everything mobile. The most successful players are focusing on one thing: How to make products, services, and devices as compelling and delightful as possible – visually, and experientially. MobileBeat 2012, July 10-11 in San Francisco , is assembling the most elite minds to debate how UI/UX is transforming every aspect of the mobile economy, and where the opportunities lie. Register here.

Filed under: mobile

T-Mobile is acting tough with its edgy new marketing campaigns, but the fourth-place U.S. wireless carrier is still in a vulnerable position after its acquisition by AT&T fell apart, and it’s losing subscribers like crazy.

So what is T-Mobile’s parent company, Deutsche Telekom, to do? Apparently, it’s considering merging T-Mobile with MetroPCS, America’s fifth-largest carrier, according to a Bloomberg report.

The deal would potentially be a stock-swap transaction, sources tell Bloomberg, that would leave Deutsche Telekom in charge of the combined company. But it seems other options are on the table for T-Mobile, including an IPO or sale of T-Mobile as it is, the sources said.

Not surprisingly, neither T-Mobile nor Deutsche Telekom are commenting on the news.

Deutsche Telekom is announcing its quarterly earnings tomorrow, and it’s projected to report a loss of 470,000 T-Mobile subscribers. That’s on top of a steady drop in subscribers over the last several quarters. After its last earnings report in February, T-Mobile announced a $4 billion “Challenger Strategy” to roll out LTE in 2013 — which seemed too little, too late for the struggling carrier.

DT would have an easier time passing a merger between T-Mobile and MetroPCS past U.S. regulators, who surprised industry watchers by squashing the $39 billion AT&T deal. As the fourth and fifth-place U.S. wireless carriers, a merger wouldn’t have the monopoly concerns that the AT&T deal did (which would have made AT&T the largest carrier in the U.S.).

Filed under: mobile, VentureBeat

The Federal Trade Commission may levy its first multimillion dollar fine against Google over a security breach initially uncovered by a Stanford student, according to an anonymous source cited by Bloomberg.

The world’s largest search company originally found itself in hot water when Jonathan Mayer, a graduate student in law and computer science, detected “cookies” that were planted on Apple’s Safari Internet browser to evade built-in protections. This is how Mayer characterized the breach on a blog post, dated Feb. 17:

Apple’s Safari web browser is configured to block third-party cookies by default. We identified four advertising companies that unexpectedly place trackable cookies in Safari. Google and Vibrant Media intentionally circumvent Safari’s privacy feature.

By circumventing Safari’s privacy settings, Google could launch targeted adverting to Safari users on desktops, iPads, and iPhones. At the time, Google issued the comment that it “didn’t anticipate this would happen” and that it would promptly remove the offending files. Google’s spokesperson added that “these advertising cookies do not collect personal information.”

It’s now the job of the FTC, a body responsible for protecting Internet users, to determine the extent of Google’s wrongdoing. If convicted, the company could face fines amounting to over $10 million, according to the Bloomberg report. The FTC is stepping up its efforts to safeguard consumers’ online rights; this would be the first fine levied by the government agency.

The investigation puts the issue of Internet privacy firmly in the spotlight. Experts say a hefty fine could serve as a lesson to Internet companies around the world. “Silicon Valley Internet companies are in stiff competition and we will see these privacy issues pop up again and again unless regulators take a firm stance,” said Pieter Gunst, fellow at Stanford University’s Center for Legal Informatics (CodeX).

[Image credit: Lightspring/Shutterstock]

Filed under: mobile, VentureBeat

Payments platform Square has released a number of new stats today, as well as good news for merchants using its mobile payments app to accept credit cards. According to a Bloomberg report, Square is now processing $5 billion in annual payments (or around $416 million in payments per month), which is up from $4 billion in annual payments in March. And payment volume is up 25 percent over the past month.

Square also says that it will be making funds available in merchants’ bank accounts the next business morning (for any sales made before 5 pm), while other merchant processors can take 2 to 5 business days to get merchants their money. This is a big win for merchants, who now have access to their sales revenue immediately.

And last week we heard that Square is looking to raise around $250 million funding at a $4 billion. Square’s CEO and co-founder Jack Dorsey and COO Keith Rabois just wrapped up the 10-day trip to the East Coast to meet with institutional investors, including Fidelity and Legg Mason.

Oakley, maker of high-end designer sunglasses, is creating new technology that displays images and information directly on the lenses of a special set of eye-wear.

Sound familiar? Well, it should. Technology giant Google recently confirmed months of speculation that it was working on its own set of sci-fi movie-looking glasses, dubbed Project Glass. Google’s glasses should allow you to do many of the same things you do with your smartphone without the need of a separate device. And even though they aren’t even available to consumers, it seems that others are already looking to compete.

Oakley’s glasses technology aim to do many of the same things described by Project Glass, but it’s something the company has been working on for years, according to a Bloomberg report. And believe it or not, Oakley has about 600 patents related to smart glasses tech — some of which the search giant may need.

“As an organization, we’ve been chasing this beast since 1997,” Oakley CEO Colin Baden told Bloomberg. “Ultimately, everything happens through your eyes, and the closer we can bring it to your eyes, the quicker the consumer is going to adopt the platform.”

Baden didn’t reveal whether Oakley was working on its own set of smart glasses, but he did say the company would be willing to license some of its patents to others, such as Google, Apple, and Microsoft.

The technology would initially seek to integrate smart glasses with devices frequently used by athletes, but it could also be used to create military-grade equipment, Baden said.

TRON glasses image via Oakley

Filed under: mobile, offBeat, VentureBeat

The U.S. Department of Justice has officially filed an antitrust lawsuit against Apple and a handful of major book publishers, including Hachette, HarperCollins, Macmillan and Penguin.

The DOJ is charging the companies for anti-competitive practices regarding the pricing and sales of e-books, as VentureBeat previously reported. Last year Apple switched its prices structure with publishers to an “agency model,” which allowed those publishers to set their own prices on e-books while giving Apple a standard cut of the revenue.

The portion of the deal in question states that e-books sold through the iTunes store cannot be sold at a lower price anywhere else on the Internet. That’s pretty good move for Apple, because it means that e-books listed in iTunes cannot be undersold. However, it also creates higher prices for consumers and stifles competition.

The DOJ is said to have reached an accord with Simon & Schuster, Hachette, and HarperCollins to settle allegations that they conspired with Apple Inc. to set prices of digital books, according to a Bloomberg report that cites unnamed people familiar with the matter.

The Justice Department has been investigating the matter since last year. Last month, the DOJ warned all the companies involved that an antitrust suit would happen if things didn’t change.

The outcome of the DOJ lawsuit could mean cheaper prices on e-books for consumers from the publishers involved. It could also mean lower revenues for publishers as well as book authors.

Filed under: media

Notable tech venture capitalist Chris Sacca has raised at least $25 million for new investment fund Lowercase Spur, according to a SEC document filed today.

The new fund comes a little over a year after Sacca’s first investment fund, Lowercase Capital. That fund raised nearly $50 million and invested in plenty of well-known tech startups, such as Turntable.fm, Backupify, BackType, Twillo, Formspring, and Uber. The first fund is reportedly worth about five times as much as its original value, according to a Bloomberg report in March.

The new fund, which was opened in 2011 with Sacca’s own money, will reportedly invest in startups over the next decade — and mostly to put additional money into companies that were initially funded by Lowercase Capital, according to Bloomberg.

We’re reaching out to Sacca for more details and will update the post with any new information.

via TechCrunch

Filed under: deals, VentureBeat