In a recent development, major U.S. wireless carriers have refuted claims of being in talks with Amazon.com Inc to offer low-cost wireless services to its Prime members. Shares of wireless carriers experienced a decline following a report by Bloomberg News suggesting that Amazon was negotiating partnerships, including a potential tie-up with Dish Network, to provide wireless plans for as low as $10 a month to Prime members, leveraging the lowest possible wholesale prices.
As per a Reuters report, an Amazon spokesperson said, "We are always exploring adding even more benefits for Prime members, but don't have plans to add wireless at this time." AT&T, Verizon, and T-Mobile also denied any ongoing discussions with Amazon, while Dish Network did not provide a response to the publication, the report added.
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AT&T clarified that they were not engaged in discussions with Amazon regarding reselling wireless services. Similarly, Verizon confirmed that they were not negotiating with Amazon for the resale of their wireless network and added that while they remained open to potential opportunities, they had nothing to report at the moment. T-Mobile emphasised that they were not in discussions with Amazon regarding the inclusion of their wireless services in the Prime service, and Amazon had informed them that they had no plans to add wireless service.
Analysts have noted that Amazon's potential entry into the telecom space could disrupt the industry by offering cheaper plans in a country known for having some of the highest wireless charges globally.
Following this news, Amazon's shares experienced a 1.2% increase, while Verizon and AT&T saw a decline of over 3%, and T-Mobile witnessed a 6.4% drop. Shares of Dish Network rose by 17% on the back of these speculations. In May, Dish's stocks also rallied following a Wall Street Journal report indicating discussions between Dish and Amazon for the sale of Dish's wireless plans.
For Amazon, such a deal could attract more customers to its Prime service, especially as the growth in key markets like the U.S. has plateaued. In 2022, Amazon experienced its slowest revenue growth in at least 20 years due to reduced spending by businesses and consumers amid a challenging economic climate.
