Panos Panay closes (for now) the door on an Amazon smartphone

In March, some rumors indicated that Amazon was developing a new smartphone with a strong integration of the Amazon Alexa voice assistant. According to these sources, the project, internally identified with the codename Transformer, was expected to promote the use of artificial intelligence and the digital services of the group.

In an interview with the Financial Times, however, Panos Panay significantly downplayed these speculations. The executive stated that creating a phone does not represent the company's goal and that, at present, there is no clear direction that would make such a product sensible. He added that there are other hardware formats considered more important on which to concentrate resources and investments.

These statements are particularly relevant considering Panay's personal experience, as he previously led the development of the Microsoft Surface Duo. We should also not forget Amazon's previous attempt with the Amazon Fire Phone: the latter hit the market in 2014 but was withdrawn about a year later due to sales below expectations.

Panay's and Amazon's position on creating a smartphone is clear; he emphasized that he does not intend to repeat the mistake of simply proposing "another phone" to consumers. According to the executive, Amazon believes it already understands the most urgent needs of its customer base and prefers to invest only when there are concrete and strategically relevant opportunities.

A potential return to the smartphone sector would entail considerable risks, as the company would be competing directly with established players like Apple and Samsung. Moreover, Amazon's devices division has been under pressure for years to demonstrate its economic sustainability.

Panay explained that Andy Jassy tasked him with transforming the hardware division into one of the group’s next big businesses. According to him, to achieve this goal, it is necessary to promote the use of devices and convince Amazon device owners to use Amazon services, such as Amazon Music and Amazon Shopping. "We want our business to be profitable. I can say that with certainty," Panay stated to the Financial Times.