A recently released report indicates that Amazon is currently testing a new Wi-Fi spectrum network. The test uses a proposed wireless spectrum operated by satellite communications company Globalstar that is located in the upper end of the 2.4-GHz band.
This location is described as uncluttered and of higher performance and is considered the basis of a possible managed Globalstar service with cellular-esque quality and roaming capability.
Is Amazon The Next New Cellular Company?
With companies like Microsoft moving away from comfortable markets into new and unexplored territory with the Surface, it is easy to imagine that a company with the reach of Amazon might consider jumping into the mobile device market.
Amazon has not commented publicly on the reasons behind the Wi-Fi spectrum tests performed at Amazon’s Cupertino, CA offices and any speculation as to the ultimate ends of these tests are just that, speculation. However, I am not convinced that Amazon intends to test the mobile phone provider market.
Amazon, as a company, exists in the web and on Kindle devices as a portal for the distribution of consumer goods and products. Initially, the products that Amazon built its empire upon were books. Over time, the business model has changed to higher profit-margin items and then to ultimately anything a person could consider purchase worthy.
The only hurdle between Amazon and the companies millions of happy customers is the gateway in which the Amazon portal is reached. Home users have to negotiate internet service providers, operating systems, browsers, and search engines. Kindle users either connect through a home Wi-Fi network or a 3G wireless phone service when outside of the home (and only on applicable Kindle devices).
Mobile phone users operate through multiple types of phone service carriers, multiple operating systems and specific brand-only versions, or Wi-Fi internet connections. Each gateway process includes many steps that may or may not interrupt a consumer’s access to the Amazon merchandising portal.
A New Solution?
Enter Amazon with a new solution! What is Amazon offered a nationwide Wi-Fi access through Kindle devices or included in the Amazon Prime membership? Now the only gateway that an Amazon consumer would have to negotiate would be a portal operated and provided by Amazon itself.
Amazon would then control the experience of their most avid customers completely while gathering Google-level analytics on shopping and web browsing activates of all users on the new network.
Amazon would be crazy to let an opportunity like this get away. As long as the financials are adequate and profitable for Amazon, there very little downside.