The reason for Amazon to build a phone is for distribution of digital content. As Apple proved with the iPod and then the iPhone, the device is the distributor. Music, movies, video, books, and apps are all multi-billion dollar industries. In a fragmented world of content producers, power goes to the distributor. The decreasing costs of producing quality content means the world will only become more fragmented, hence distribution becomes more critical.
I guess I was thinking mostly about books. A phone makes sense since Amazon sells a lot of content that people consume on their phones, particularly music, and to a lesser extent, movies and books. As a defensive move against Google Play, it makes even more sense.
My comment aside, you are right to question if it's the wisest investment for Amazon to make a phone. Could they form strategic partnerships instead, paying handset manufacturers to install Amazon media marketplaces like Google did with Dell to install search? As Nokia, Palm, BlackBerry, and others can attest, phone making is a difficult business. I haven't crunched the numbers and cannot offer an informed opinion, but as I articulated above, there is reason for Amazon to consider the option.
