Amazon.com Inc is seemingly interested in buying Boost Mobile, the prepaid cell phone wireless service from T-Mobile US Inc and Spirit Corp, according to two sources familiar with the matter.
It is believed that Amazon is planning on buying Boost Mobile, one of Sprint’s prepaid brands because it would allow the e-commerce giant to gain access to T-Mobile’s new wireless network for at least six years from now, said the source in a Reuters report.
It is said that ‘New T-Mobile’ will be the name used by Sprint and T-Mobile for referring to the potential merger. The source also says that Amazon will be potentially interested in any wireless spectrum that it could divest.
For quite some time now, Amazon has already invested into offering phone calls through the Echo Connect device which uses the home phone service which enables Alexa to make phone calls. Though it wasn’t immediately clear as to why an e-commerce giant would want to invest in a wireless service venture, it may now make sense considering Amazon’s efforts to offer voice calling features through its devices.
Also, Amazon has a demonstrated history of venturing into new industries such as its streaming service Amazon Prime and smart devices such as Alexa. We’ve also seen Amazon going as far as creating original shows for its streaming service. Currently, Amazon’s a part of the ‘Big Tech’ group consisting of Apple Inc, Alphabet Inc, Facebook Inc, and Amazon Inc, as well.
It was already determined by both Sprint and T-Mobile to sell Boost for reducing their market share in the prepaid wireless business and to gain regulatory approval for their planned merger of $26 billion.
If this merger would be approved by the United States, then it would leave the country with only three wireless carriers instead of four. The U.S Justice Department needs to thoroughly scrutinize Amazon to ensure that the company would stay viable and preserve the competition.
Few consumer advocates have raised concerns about how this merger could raise the prices for wireless users and have also called for an additional competitor to ensure fair competition and pricing. It is estimated that the sale of Boost can bring in a revenue of $3 billion according to a few potential bidders.
While Sprint and T-Mobile didn’t respond for comment immediately, Amazon, on the other hand, declined to comment.