A pair of reports on Wednesday claim Google is about to wade into the cellular network industry through deals with U.S. carriers T-Mobile and Sprint, a bold move that could push competitors to cut prices and boost data speeds.
Citing sources with knowledge of Google's plans, The Wall Street Journal reports the Internet search giant is looking to strike deals with Sprint and T-Mobile, respectively the third- and fourth-largest mobile providers in the U.S., to hop on their network and sell branded cellular services directly to customers.
The project, identified by The Information as codename "Nova," is essentially a vanilla mobile virtual network operator (MVNO) scheme, except it's Google that is buying wholesale access to Sprint and T-Mobile's networks. Referred to as an experiment within Google, the initiative is reportedly designed to stoke carriers into lowering prices while delivering faster data speeds, sources said.
According to both reports, longtime executive Nick Fox is in charge of the project. The company first reached out to Sprint over a potential MVNO partnership 18 months ago and employees have already beta tested the service, but an understanding of Google's endgame has been elusive.
Given the Android maker's penchant for disruption, however, carriers have reportedly taken a wary approach to the proposed deal. Sprint, for example, is said to be inserting contract terms that trigger new negotiations if Google's customer base hits a certain level.
The Information's Amir Efrati believes a Google play for cellular network domination is unlikely, but notes the company is developing exotic data delivery technologies that could one day skirt carriers altogether. For example, Google X projects like Loon, which offers Web access via high-altitude balloons, are designed to bring more people in more countries online. Google recently told the FCC that high-frequency spectrum could be used for "the next generation of unlicensed broadband services" and "entirely new technologies and innovations."
Further, Google is known for lobbying government officials to free up regulated wireless spectrum for additional consumer networks. Most recently, Google sent a letter to the Federal Communications Commission last week saying higher-frequency spectrum could be provisioned for "the next generation of unlicensed broadband services," as well as "entirely new technologies and innovations," the WSJ reports.
It is unclear when Google's MVNO will surface, if at all, but the company is reportedly planning to sell device and cellular service packages through an online storefront.
Apple was also rumored to be mulling its own MVNO during the iPhone's early days, with one report claiming late cofounder Steve Jobs wanted to built out an entire cell network dedicated to the handset. The company even filed for patents covering MVNO systems.
The iPhone quickly gained ground in the global smartphone market, however, and talk of an Apple-branded MVNO died down. In 2012, CEO Tim Cook said Apple doesn't need to "own the pipe," referring to investment in carrier networks. He noted that Apple is focused on delivering quality devices and would rather leave network operations to partner telcos.