Amazon has a tough row to hoe here. Wooing developers to a nascent market is never easy. Just ask Microsoft.

Amazon is working hard to flesh out a portfolio of key apps that will likely be crucial to its new smartphone’s success. That’s no easy task in a smartphone market dominated by two giant device-makers, Apple and Samsung, which together account for 60 percent of the phones currently in use in the U.S., according to research by the Yankee Group.

As with its Kindle Fire tablet, Amazon is building its phone with a modified version of Google’s Android OS. Sources said the company has been developing a mechanism to automatically translate existing Android apps to Amazon apps. But it hasn’t yet finished it. In the meantime, Amazon has been wooing app developers with offers of money, Amazon Web Services, development assistance, and the promise of potentially being preloaded onto the phone.

Perhaps the most interesting bit:

Another issue Amazon faces as it works to bring its first smartphone to market: Google, which has recently become stricter in its approach to Android and its app ecosystem. The company no longer gives forked Android sellers access to crucial phone features such as its maps, in-app purchases and notifications.

Some big problems to solve.

One person from a company that has decided for now not to take Amazon up on its offer to develop a smartphone app for the device’s launch expressed skepticism about building Amazon-specific wrappers and workarounds.

“I don’t know how they’ll differentiate with Samsung,” the source said. “There’s nothing really that different.”

This is really getting interesting.