Amazon is reportedly in talks with several wireless carriers, including Verizon, T-Mobile, and Dish, about launching a mobile service for its Prime members. This news sent shares of telecom stocks lower on Friday, with Verizon falling more than 3% in afternoon trading and T-Mobile sliding over 7%. AT&T’s stock was also down more than 3%, while Dish shares surged more than 15%.
According to Bloomberg, Amazon is negotiating with Verizon, T-Mobile, and Dish about the possibility of reselling their mobile services to its Prime members at low cost or potentially for free. The discussions have been ongoing for six to eight weeks and have also included AT&T, but it could be several more months before a plan materializes, according to the report.
An Amazon spokesperson, Bradley Mattinger, said in a statement, “We are always exploring adding even more benefits for Prime members, but don’t have plans to add wireless at this time.” A T-Mobile spokesperson also said in a statement to CNBC, “Amazon 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. 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.”
Verizon and AT&T have said that they’re not in discussions with Amazon to resell wireless services, while Dish representatives weren’t immediately available to comment.
Amazon has previously experimented in the mobile category, launching its ill-fated Fire Phone in July 2014 before scrapping it a year later. More recently, it has focused on high-speed internet through its Kuiper program, which aims to build a network of 3,236 satellites in low Earth orbit.
A mobile plan could serve as an attractive hook for Amazon to lure in more Prime subscribers. Launched in 2005, Amazon Prime members pay $139 a year for access to free two-day shipping, access to exclusive movies and TV shows, as well as newer benefits like generic prescription discounts and Grubhub delivery perks.
Amazon has been looking for ways to attract more Prime members as it faces growing competition with Walmart’s Walmart+ loyalty program and concerns about slowing membership growth. The company had more than 200 million subscribers worldwide as of April 2021.
By partnering up with a company like Verizon or Dish, Amazon would essentially function as a mobile virtual network operator. Instead of owning its own wireless network, the company would purchase data from a large carrier and resell it to consumers.
Amazon is in talks with major wireless carriers to launch a mobile service for its Prime members. The discussions have been ongoing for several weeks, and Amazon is negotiating with Verizon, T-Mobile, and Dish about the possibility of reselling their mobile services to its Prime members at low cost or potentially for free. Amazon has been looking for ways to attract more Prime members and stay competitive with Walmart’s Walmart+ loyalty program. A mobile plan could serve as an attractive hook for Amazon to lure in more Prime subscribers. By partnering with a company like Verizon or Dish, Amazon would function as a mobile virtual network operator.
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