Amazon will soon be offering potential Prime subscribers another perk, the ability to save big on their monthly mobile phone bill. What will happen, said the publication Business Insider.
The company is in talks with mobile operators about a potential Prime Wireless plan offer that could range from $0 to $10 per month for Amazon Prime members. The talks included T-Mobile, Verizon and Dish, according to the report, although the idea could take months to launch and still not come to fruition.
"We're always looking into adding more benefits for Prime members, but we're not currently planning to add cellular," Amazon spokesman Bradley Mattinger said in a statement.
"Amazon is a great partner for T-Mobile in many areas, and we're always looking forward to working closer," said a T-Mobile spokesperson. “However, we are not discussing including our mobile service with Prime, and Amazon has informed us that it has no plans to add such a service.”
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An AT&T spokesman said the company is "not in talks with Amazon to resell mobile services."
If such a service is eventually launched, it will be a significant event in the communications industry. Amazon is a known innovator with the patience and ability to spend huge sums of money to win market share, and wireless operators will have to weigh the potential size of such a deal against the chances of growing their customer base against the possible risk of gaining a new competitor.
For Amazon, it's all about growing Prime members and keeping existing subscribers going forward with meaningful perks. This is especially important if the company raises the price of Prime, which it did in 2022 by increasing its annual subscription from $119 to $139.
But low-cost mobile connectivity from Amazon can be tempting.
Even at $10 a month, the Prime Wireless plan represents a real savings for most people. The average American pays $144 per month on their phone bill.
Amazon is in talks with mobile operators to use their network as a mobile virtual network operator (MVNO) to save on infrastructure costs, according to a Bloomberg report. MVNOs offer more affordable plans - the average US phone bill for an MVNO subscriber is $77 on JD Power, and there are low cost plans around $15.
This is far from Amazon's first foray into the mobile market. Amazon released the Fire phone nearly a decade ago under an exclusive deal with AT&T. The product failed, with then-CEO Jeff Bezos calling the product a "failure" in a 2018 shareholder letter that helped "accelerate our Echo and Alexa efforts."