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For years now we’ve been hearing about how Amazon will release its own smartphone, likely under the Kindle Fire brand. We’ve even heard reports on the company developing a phone with 3D display technology, expanding their R&D office space and testing a secret wireless network. Even after all of the rumors and speculation, Amazon has yet to announce a handset of their own.

While we wouldn’t be that surprised if Amazon did eventually release some kind of smartphone, today’s rumor seems pretty far out in the left field. According to sources reporting to former Wall Street Journal reporter, Jessica E. Lessin, Amazon’s handset will be free of charge.

As soon as we hear the word ‘free’ next to phone, some red flags immediately come up.

Few things in life are free, and phones are never one of them. Sure, they might be free up front, but there’s always a catch – usually a two-year contract. That’s where this rumor gets a little crazy, word has it that Amazon is interested in offering their handset free with or without a carrier contract.

First thought: No way in hell.

Second thought: The sources say no carrier contract – it doesn’t say anything about whether or not Amazon would require its own service agreements.

IF (and it’s a big if) Amazon was to give away a phone absolutely free with no carrier contract, the phone would likely be offered through its online website and would require several years of Amazon Prime, and perhaps even some other premium services or subscriptions that they’ve yet to announce.

The sources also claim that – in addition to selling it through the website – Amazon is looking into selling the phone via carriers. Of course, no carrier is going to give away a phone for free without a contract.

Could Amazon pull this off?

Subsidizing a phone isn’t anything new, as carriers do it all the time. An Amazon phone that is free with paid Amazon Prime service and a two-year contract doesn’t seem all that crazy. But no carrier contract at all? It seems hard to believe that Amazon could pull off such a risky move.

Sure, an Amazon phone would run a forked version of Android that is highly integrated into Amazon services (and without Google Play), but could Amazon apps, media purchases and Amazon Prime be enough to recoup the costs involved here? Doesn’t seem that likely, but I suppose anything is possible. If it does happen, you can safely bet that the phone will be littered with ads throughout the UI and lockscreen.

What do you think of this latest Amazon smartphone rumor? If it did happen would you be willing to sign up for Amazon Prime and endure ads, all for the sake of getting a free phone?

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