Amazon stages a mystery unveiling - widely expected to be a smartphone - on Wednesday to delve into a super competitive market dominated by Apple and Samsung.
The company has given a hint as to what is in store and has invited a small group of media to the Seattle event to be hosted by Amazon founder and chief executive Jeff Bezos.
The announcement contained an image of what appeared to be the edge of a smartphone - a device long rumored to be in the works by the Seattle, Washington firm, which is a retailer of a multitude of goods and digital content.
A video shows people apparently dazzled by a device that is not seen.
The Wall Street Journal reported Tuesday that AT&T will be the exclusive operator of the expected Amazon phone.
Read: An app for night blindness
Analysts see potential for shaking up the market.
The phone is expected to hit the market in September, according to specialized web sites, which put the price range at $99 to $199.
"If it is a smartphone, Amazon would automatically be considered one of the top players before it even ships its first phone," said Gerry Purdy, chief mobile analyst for Compass Intelligence.
Purdy said Amazon's market clout, large customer base and willingness to sell devices at low profit margins gives the company an opportunity to get a foothold in this key segment.
"They have a lot of tools," Purdy told AFP. "They can give free access to content, access to music, or they could credit your monthly phone bill if you spend enough with Amazon."
Read: Smartphone game helping to find cancer cures
Amazon has worked to keep customers close with its Amazon Prime subscription service, for $99 a year. This gives consumers free delivery for goods, as well as access to Amazon's streaming video service. Last week, the company added streaming music for no additional charge.
But Amazon still needs to deliver a high-quality handset and offer enough apps to compete with the popular devices from Apple and makers such as Samsung which use the Google Android platform.
Several reports have said Amazon's new phone would have 3D technology, making for a richer, multidimensional display that could differentiate it from rivals.
Read: Samsung adds heart-rate monitor to smartphone
In a cryptic message to journalists attending the event, Bezos sent copies of his favorite childhood book, "Mr. Pine's Purple House," which is about one house that stands out from the others.
Forrester Research analyst James McQuivey said Amazon is not interested in taking away a lot of Apple and Samsung market share, but in keeping its customers more engaged.
"Amazon wants to be in your pocket," he told AFP. "It wants to be with you in your hand's reach whenever you think about something you want to purchase.
Smartphones to prevent substance abuse
Smartphones tied to sexual activity
Smartphones used to detect disease