Amazon Plans To Offer Internet Service In Europe: Another Way To Sell Prime?
Amazon is reportedly planning on becoming its own internet service provider, eyeing Europe as the first location it'll directly sell a broadband service to.
In countries like Germany and the UK, regulations are comparatively more lax than those set in place in the United States, and this may be an attractive entry point for Amazon, since it doesn't want to build its own network, and it doesn't really need to.
To put it in perspective, in the UK, for example, broadband service providers don't restrict access to their network, unlike in the United States. As a testament to that, look at telecommunications company British Telecom, which is required to offer wholesale access from its network. Amazon can take advantage of that, reselling that access at a profit and "improve its margins through the retail business" according to Engadget.
Another example is Germany, where Deutsche Telekom also makes its network accessible to other broadband providers. Network regulations in the UK and Germany make for compelling reasons why Amazon is keen on Europe and not in the United States.
In the United States, options for ISPs come few, or in prevalent instances, even only one since resellers don't have legal access to the ISPs' wired networks. In comparison, the U.S. mobile industry offers wholesale access, and Google has taken advantage of this with its Project Fi, a fast pay-for-what-you-use data service in the country. Amazon could possibly tap into wireless internet in the future, but wired networks are out of the question for now, at least in the United States.
Several news outlets have pointed out that Amazon's ISP plan is another way for the company to sell its fast-shipping video-streaming service Prime. Amazon has not made a comment regarding the news, but a report by The Information states that Amazon could stash internet and video service in one package, mirroring what cable TV and internet providers usually offer consumers.
For the uninitiated, Amazon Prime is the company's annual $99 membership program that provides subscribers access to TV shows and movies, including Amazon's original content, music, e-books and other specific services by the company. Those who are subscribed to Amazon Prime are also eligible for faster shipping times for online orders, sometimes even shipping the same day for those with eligible zip codes.
Amazon's specific ISP plans on Europe are scant since there's still no official word from the company, but if it's indeed intending to bundle its broadband service with Amazon Prime, it could give other European ISPs a run for their money.