Google is reportedly planing on setting itself up as a Mobile Virtual Network Operator (MVNO) in the United States, as the search engine giant continues to explore business opportunities in new sectors.
According to sources, Google’s ambition to become a player in the mobile industry has seen it approach both Sprint Corp and T-Mobile US Inc.
Essentially, a MVNO does not own the wireless network infrastructure over which it provides services to its customers. Instead, it enters into an agreement with a mobile network operator to obtain bulk access to network services at wholesale rates, then sets retail prices independently.
Late last year for example, TalkTalk signed a Mobile Virtual Network Operator agreement with Telefonica UK (O2) after it dropped Vodafone.
Meanwhile, the Wall Street Journal corroborated the story, reporting that Google had already struck deals with both Sprint and T-Mobile.
Rumours about Google’s potential entry into the mobile sector have been ongoing for years now. In late 2012, Google was said to be in talks with US satellite television provider Dish Network about building a wireless broadband network in the United States
Then in April 2014, Google was reported talking to Verizon and Sprint about setting up as MVNO.
And Google does have some experience here, as it already operates a number of telecommunication-based projects such as Google Fiber (a fibre optic network in the US) and Project Loon (high-altitude balloons providing internet access).
But Google has also total control of the hardware with those projects and can make all the decisions goings. If the MVNO reports are accurate, the search engine would have to abide by the terms of the agreement it reaches with the mobile operators.
There is some speculation that Google is considering the MVNO option, as it would allow it to create a branded mobile service for its Nexus smartphones. The service could for example be sold through the Google Play Store.
The reports suggest that Google is likely to launch its MVNO service this year. And Google is not the only tech company reported to have considered a MVNO option.
A couple of years ago, some media reports suggested that Apple was considering halting the current process whereby it sells its iPhone via mobile operators, and instead offer it via its own virtual mobile network service.
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