Will Amazon Launch Its Own Mobile Network?

By Gary Kim August 23, 2013

Amazon reportedly has tested potential fourth generation mobile network spectrum (Long Term Evolution), a move that might not surprise many observers. The reported test suggests Amazon is at least thinking about launching a mobile ISP operation of its own.

Observers might note that Amazon already indirectly functions as an ISP, leasing capacity to support fee-free content downloads to Kindles.

To be sure, app providers already have made moves some might have thought impossible, some years ago. App providers have produced their own branded tablets and smart phones, for example. 

Image via Shutterstock

And that has led some to speculate that one or more major application providers might take another step and become full-fledged service providers.

Of course, Google already has done so, with Google Fiber and as the supplier of Wi-Fi access to Starbucks.

For at least several years, observers have speculated about what leading applications providers such as Google might be willing to undertake in support of their core business models.

It simply now is a fact that app providers have become device suppliers and ISPs. The only remaining speculation is whether any app providers in addition to Google might want to become full-fledged telcos, video entertainment providers or Internet service providers or mobile providers.

Google Fiber makes Google an ISP and video entertainment provider. Google Hangouts makes Google a communications service provider. But Apple and Amazon already compete in the over the top video entertainment business to some extent. And Sony and Intel also have launched, or are launching, such services.

So the news about Amazon will only fuel thinking about the strategic advantages for an app provider to become a branded ISP.

With a SoftBank-owned Sprint and T-Mobile US also intending to disrupt the U.S. mobile business, the question is the extent to which any fuller entry by one or more powerful app providers would further disrupt the U.S. mobile market.

Many observers believe Google Fiber already is changing the U.S. fixed network ISP business. Given the importance of mobile revenue opportunities, can mobile be too far behind?

Edited by Alisen Downey

Contributing Editor

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