Google Wireless, and What It Means for Other Carriers

Google Fiber

Google wants to become a wireless carrier now.

Actually, this isn’t a new development — Google tried and failed to secure wireless spectrum rights back in 2008 (they lost to Verizon); and, more recently, have been rumored to be looking into an opportunity to provide “WiFi-First” plans to customers with Android-powered Google smartphones.

At the Mobile World Congress this Monday, the company confirmed their plans to do just that.

Google Wireless, which was pitched as a “small scale” test by senior VP Sundar Pichai, is expected to roll out sometime this year. Built on a combination of existing Sprint & T-Mobile cell towers, and public/private WiFi connections, Google Wireless will focus on making connections through the latter first; and relying on the former when WiFi connectivity is out of reach. Google Sprint and T-Mobile

Pichai downplayed the company’s attempt to undermine the “big four” wireless carriers — given Google’s reliance on these established networks to power their own carrier test, and the fact that Google brings in substantial revenue from Android and Google-developed phones on these carriers, the cautious approach is understandable.

However, there’s certainly a reason for the big wireless carriers to be a little nervous about Google’s foray into their space.

Most of the products and services that come from Google start off in the same way — as a “limited test”. Gmail was once an invite-only product; Glass & Voice & Inbox, too. On a larger scale, Google Fiber, the company’s high-speed internet, began as an experiment in just a single market in 2010; recently, the company announced plans to bring Fiber to up to 18 more cities in 4 metro areas.

Google also has the potential ability to undercut other carriers’ pricing initially — both because it is creating the devices that will likely be used, and because they stand to earn increased ad revenue through mobile advertising. Leveraging Voice and Hangouts for calls & texts, Google can keep much of the Google Wireless experience “in-house”.

Though, as Marketing Land points out, low-margin pricing may cause undue tension with the established names (who still sell Google phones + Android for the company). While Google could eventually be a competitor (or possible corporate-owner) for some of these carriers, there’s little doubt they won’t want to rock the boat initially. Switching to Android

What becomes of Google Wireless, and how/if it affects other carriers’ pricing, is yet to be seen. In any case, it will be interesting to see how the company positions themselves in a crowded market to pique consumer interest.

One Pingback/Trackback

banner