Thursday, June 6, 2019

Amazon Prime Mobile would be the carriers worst nightmare

There has recently been speculation in the press that Amazon is preparing to enter the US wireless market, either as a MVNO or as a fourth carrier, buying the forced divestitures of a theoretical T-Mobile/Sprint merger.

On the face of it, this looks to be just another one of many companies trying their luck at the wireless market, where few succeed and many exit with bruised egos and empty wallets.

Amazon would be different and could pose a significant challenge to all the existing carriers as well as MVNOs. The main difference has to do with two things, margins and valuations and how they work together. Let me explain.