The online retailer has put in an order with Taiwanese manufacturer Quanta Computer for 800,000 touch-screen tablets, according to widespread reports.
No specifications are available at present, but the device is widely tipped to run the Android operating system as Amazon already provides a dedicated online marketplace for the platform, known as Amazon Appstore for Android.
However, despite huge success in the e-book reader market, Amazon will find it difficult make a tablet that directly rivals the Apple iPad, according to Francisco Jeronimo, research manager for European mobile devices at IDC.
"The Kindle has been such a success because it is a good product that costs just $100 and Amazon will need to retain a budget price to attract users," he told V3.co.uk.
"Amazon is likely to build a 7in 'Super Kindle'-type tablet which runs on Android and can support video, social applications and full web browsing."
Jeronimo pointed out that Amazon will also have to push magazines and newspapers via the device, as the Kindle app is also available on competing devices and will not be enough of a differentiator.
V3.co.uk contacted Amazon for information on the tablet, but the firm declined to comment on future plans.
Meanwhile, the tablet market continues to heat up with big things expected from Android Honeycomb tablets such as the Motorola Xoom and forthcoming Samsung Galaxy Tab line.
However, Jeronimo suggested that only a handful of the 200-odd devices expected to come on the market this year will succeed.
"Apple will retain 80 per cent of the market, but RIM's BlackBerry PlayBook is expected to do well in the enterprise," he said.
"Consumers perceive tablets as an extension of smartphones, and manufacturers such as Dell and Sony, which come from a laptop background, will always find it difficult to break into the space."
However, despite huge success in the e-book reader market, Amazon will find it difficult make a tablet that directly rivals the Apple iPad, according to Francisco Jeronimo, research manager for European mobile devices at IDC.
"The Kindle has been such a success because it is a good product that costs just $100 and Amazon will need to retain a budget price to attract users," he told V3.co.uk.
"Amazon is likely to build a 7in 'Super Kindle'-type tablet which runs on Android and can support video, social applications and full web browsing."
Jeronimo pointed out that Amazon will also have to push magazines and newspapers via the device, as the Kindle app is also available on competing devices and will not be enough of a differentiator.
V3.co.uk contacted Amazon for information on the tablet, but the firm declined to comment on future plans.
Meanwhile, the tablet market continues to heat up with big things expected from Android Honeycomb tablets such as the Motorola Xoom and forthcoming Samsung Galaxy Tab line.
However, Jeronimo suggested that only a handful of the 200-odd devices expected to come on the market this year will succeed.
"Apple will retain 80 per cent of the market, but RIM's BlackBerry PlayBook is expected to do well in the enterprise," he said.
"Consumers perceive tablets as an extension of smartphones, and manufacturers such as Dell and Sony, which come from a laptop background, will always find it difficult to break into the space."
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