Future Tech

Has Amazon found the ultimate lock-in? Cheap cellphone service for Prime

Tan KW
Publish date: Sat, 03 Jun 2023, 06:46 AM
Tan KW
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Future Tech

Analysis Folks in the United States could soon have another option for cheaper cellphone service: Amazon Prime.

Bloomberg reports that Amazon is in talks with major US carriers, including Verizon, T-Mobile US, and Dish Network, to offer low-cost phone service to Prime customers.

The move isn't all that surprising. Mobile virtual network operators (MVNO) are a dime a dozen. Google Fi Wireless, Boost Mobile, Mint Mobile, and Straight Talk are just a handful of the dozens of options available in the US. These companies pay to use larger carriers' networks, then resell that access to customers at low prices.

Amazon reportedly plans to offer service for as little as $10 a month, though it's whispered the web giant is also considering offering the service at no cost to Prime subscribers. Prime customers already pay $139 a year for access to express shipping and Amazon's streaming services, so it could be a way to inspire customer loyalty.

We suppose it's a lot harder to cancel your Prime subscription if you have to go through the rigmarole of porting your number to another network or getting a new one.

Amazon is hardly the first major tech or e-commerce company to go down this road. As we said, Google has operated an MVNO service under the Fi brand for years, meanwhile Walmart has Family Mobile.

There's no guarantee that Amazon will actually offer the service. The talks have reportedly been ongoing for the past six to eight weeks and have, at times, included AT&T in the mix. According to the report, it could be months before the House That Bezos Built starts rolling out service.

It's worth noting that Amazon doesn't necessarily have to choose one carrier. It's not uncommon for MVNOs to pay for access to multiple networks to ensure nationwide coverage.

It's also unclear what customers might be giving up if they opt to purchase cell service through Amazon. While most MVNOs market unlimited talk, text, and data plans, just like the larger carriers, there are usually some asterisks that need to be taken into account.

Limits on data speed and capped limits, access to 5G spectrum, tethering, and streaming video quality are common caveats associated with cut-rate wireless providers. MVNO traffic also tends to be deprioritized, which means customers could see their data speeds slow to a crawl in congested areas.

The Register reached out to Amazon for comment on their reported plans; we'll let you know if we hear anything back. ®



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