Google Inc (NASDAQ:GOOGL) is reportedly up on plans to compete with mobile carriers AT&T Inc. (NYSE:T) and Verizon Communications Inc. (NYSE:VZ) by offering a wireless service of its own through the network capacity of other mobile service providers. An anonymous source told Bloomberg that Google’s planned wireless service, to become known as Mobile Virtual Network Operator (MVNO), will start this year. Google will offer the service to its own customers by paying for capacity on a carrier’s network.
Two mobile carriers, Sprint Corp (NYSE:S) and T-Mobile US Inc (NYSE:TMUS), was identified by The Wall Street Journal as the likely networks through which Google Inc (NASDAQ:GOOGL) will offer the planned cellular service. The service, when up and running, will translate to a stiffer competition for AT&T and Verizon, even as carriers are now battling with one another over customers and pricing. Far from being a “Google Fiber for cellphones”, however, the search giant will just resell both Sprint and T-Mobile. The arrangement will mean more profits for the two carriers, and can give both the capacity both to improve call quality and undercut Verizon and AT&T on pricing.
With Google Inc (NASDAQ:GOOGL)’s Android operating system being used on over 80 percent of smartphones all over the world, the planned cellular service can be a determining factor in bringing prices down, as well as improving customers’ experience. On the other hand, the wireless service will also allow the search giant to control how its services such as YouTube videos and Gmail email service are delivered to consumers, according to The Wall Street Journal. Brian Fung of The Washington Post also observed that Google can generate commercial data through the service. He also noted how the service play a role in software integration, since all of Google Inc (NASDAQ:GOOGL)’s handsets would likely run on Android. The tech giant is also currently working on its own modular smartphone, although the planned debut for that device will be in Puerto Rico.
This article has been written by Nonito Guntan.
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