Amazon reportedly mulls offering mobile service to Prime customers (updated)
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Amazon.com (NASDAQ:AMZN) is in discussions with wireless carriers about offering low-cost or potentially free nationwide mobile phone service to Prime members, Bloomberg News reported, citing people with knowledge of the matter.
The online-retail giant has held talks with Verizon Communications (VZ), T-Mobile US (TMUS) and Dish Network (DISH) to get the lowest possible wholesale prices, according to the report. That would let Amazon offer Prime members wireless plans for $10 per month or possibly for free.
The discussions have been going on for six to eight weeks and have also included AT&T (T) at times, however the potential plan may take several months to be introduced, or could be scrapped, the report noted.
Heading into the midpoint of the trading session Friday, Dish Network (DISH) had soared 22.8%, while T-Mobile (TMUS) had fallen 8.3%; AT&T (T) was down 4.6%; and Verizon (VZ) was down 4.4%. Amazon.com (AMZN) was 1.6% higher.
Amazon cautioned on the report that there aren't current plans in place, and T-Mobile also said it wasn't in talks to include its service in Prime.
Amazon spokesperson Maggie Sivon said that the company is exploring adding more benefits for Prime members, however, they "don't have plans to add wireless at this time."
âAmazon is a great partner to T-Mobile in many areas, and we are always interested in working more closely with our cross-town neighbors in new ways," T-Mobile said in response. "However, we are not in discussions about inclusion of our wireless in Prime service, and Amazon has told us they have no plans to add wireless service.â
According to some analysts, Prime membership has stagnated in the U.S. since Amazon raised the annual price to $139 from $119, as per the report.
For the wireless industry, an Amazon collaboration could be a boost to wholesale revenue and a way to get more traffic to newly expanded 5G networks. However, Amazon's entry could also potentially have a negative impact if Prime wireless becomes popular and begins to chip away at the big carriers' customer base.
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