Amazon is reportedly interested in acquiring Boost Mobile from Sprint, which would solidify the online retail giant as a much more massive powerhouse in the world of advertisements and give the company another avenue to highlight some of the biggest sales happening on its website.
Should Amazon actually have plans to buy Boost Mobile and if the acquisition were approved, it would reportedly be allowed to use the spectrum from T-Mobile and Sprint (which are currently in the process trying to merge with each other) for a minimum period of six years, though it’s not clear what Amazon’s plans would be for the use of that spectrum.
Amazon may also have interest in the acquisition due to the potential of spectrum that could be divested. Though Amazon’s intentions for owning a wireless carrier and the spectrum that comes along with it are not clear at the moment, the notion of one of the largest tech companies in the US being the owner of a wireless carrier sort of fits nicely with other recent news regarding the merger between T-Mobile and Sprint.
It was recently reported that the US Department of Justice expressed a desire for T-Mobile and Sprint to help establish a fourth wireless carrier in the country if it were to approve the merger between the two companies. The DOJ has long held a stance that the merger could pose a problem for competition in the industry if the wireless carrier number count would drop from four to three, so its want for the current third and fourth carriers to help bring a replacement fourth carrier into the fold is easy to make sense of.
The news of Amazon showing interest in buying Boost seems timely, given that the sale of Boost might be a requirement before the approval of the T-Mobile/Sprint merger. It also sheds some light on a possible bidding war that could take place as it’s previously been reported that the CEO of FreedomPop is also interested in acquiring Boost, alongside the more recent idea that Comcast could have plans to show interest as well.
With FreedomPop and Comcast as potentially interested buyers alongside Amazon, there could be a possibility that a fourth wireless carrier would come forward following an approved T-Mobile Sprint merger, with Amazon perhaps being the most unlikely candidate.
Both FreedomPop and Comcast might seem like more viable solutions as each already deals with similar services. FreedomPop is already offering wireless service to customers as an MVNO, and Comcast is doing the same, and Boost itself is an MVNO of Sprint, so the shoe fits. Amazon could have precedent for wanting to dip its toes into the waters of the wireless market, though.
In recent years it’s shown its capability as a company to branch out and deliver products to customers that were well outside the realm of its humble beginnings, transitioning from a simple online book retailer to selling vast amounts of different products, launching smart home devices and beginning research in artificial intelligence. Not to mention its acquisitions of Twitch and Whole Foods Market, which gave Amazon new ways to generate revenue in the widely popular game streaming industry as well as the popular organic food market.
Both of those services also have tie-ins to Amazon’s Prime service, as subscribers of Prime get special deals on anything from free games to savings on any number of grocery products. Acquiring Boost and offering an MVNO service would just give Amazon one more way to link customers to Prime who may not have already been subscribing, and it certainly has the money to acquire Boost which is said to have an possible value of $3 billion in the sale.