If one is to believe The Wall Street Journal the much-rumoured Amazon Smartphone will have at least one gimmick to beat the competition-- a retina-tracking display capable of creating "hologaphic" floating images. 

The glasses-free display will also allow users to "navigate through content using just their eyes," the WSJ sources continue. 

Holographic or not, the smartphone is said to be in development at Amazon's Cupertino Lab126 facility, alongside a second (probably) more conventional handset, an "audio-only streaming device" and an online video streaming TV STB. Such hardware efforts are reportedly known as the "Alphabet Projects," since internal nomenclature involves imaginative use of the, well, alphabet (as in Project A, B, C, D...). 

The WSJ has very little actual details on the devices in question-- the sources even warn "some or all" of the devices might even end up in development hell due to concerns of the performance or financial variety. 

If Amazon does enter the smartphone market it will find a crowded arena where the Samsung-Apple duopoly dominates. According to IDC the two companies own 50% of the Q1 2013 smartphone market, with the rest left for either the usual suspects (LG, Nokia) or the Chinese competition (ZTE, Huawei, Lenovo). 

This means Amazon will probably fall back to its tablet retail strategy should it desire a fighting chance in smartphones-- low-cost devices "subsidised" through online purchases and potential new services such as mobile payments.  

Such a strategy makes even more sense in STBs and media devices, since Amazon already has the cloud-based infrastructure (not to mention content) in place. Then again, the streaming video/audio market is also fairly crowded, with the likes of Netflix, Roku, Hulu, Spotify and Apple jostling for the top spot. 

Go Amazon is Developing Smartphone with 3D Screen (WSJ.com)

Go Bloomberg: Amazon's TV Plans