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Amazon reportedly in talks to offer mobile service for Prime members

Amazon may be looking to offer a new service for its Prime members. Bloomberg News is reporting Amazon is in early talks with wireless companies to offer mobile phone plans for its U.S. Prime members. Yahoo Finance Tech Editor Dan Howley explains why Amazon may want to expand its Prime offerings.

Video transcript

- Amazon Prime members might be in for a new perk, phone plans. Yahoo Finance's, Dan Howley, has this story. Dan, I need to know, am I about to switch?

DAN HOWLEY: That's apparently what seems to be going on here. This is according to a report from Bloomberg that Amazon is talking to various carriers about potentially offering unlimited wireless deals for as little as nothing. It would be wrapped into your Prime benefit. Could be $10 a month, could be nothing. It could be wrapped in. There's really no firm understanding quite yet.

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This is still in early discussions, according to this report. And we had heard from T-Mobile specifically that they are not interested or they're not speaking with Amazon at this point. We have them saying, "Amazon is a great partner to T-Mobile in many areas, and we are always interested in working more closely with our cross-town neighbors in new ways. However, we are not in discussions about inclusion of our wireless in Prime service, and Amazon has told us they have no plans to add wireless service."

So that seems to throw a wrench in this conversation. But if they did manage to do this, you can imagine that it would be incredibly difficult for the likes of AT&T, T-Mobile, Verizon, to really continue to operate at the pricing they currently do. This is good for Dish Network though, because dishes, or Dish rather instead, Dish Network, because they're basically trying to get their own wireless network up off the ground.

Remember back when we had Sprint purchased by T-Mobile, Dish picked up some of the subscribers there. And then they're trying to be a fourth offering right now, although it's still the major three. So we just have to wait and see if this does eventually become a new part of Prime, and a better reason to sign up.

- Well, Dan. That was my question, just in terms of, do you think that this makes sense potentially for Amazon to push into this sector and why?

DAN HOWLEY: It does. I think if they can get a bigger list of offerings for the price, it's $139 right now a year. You have Amazon Prime Video, you have the ability for same day delivery, you have Prime delivery. So I think if you can get another benefit like this, it would just entice more people to want to come back in, or stick around permanently.

Because OK, maybe you sign up for Prime around the holidays. Maybe you sign up for Prime when the boys come out on Prime Video. And then you ditch it. Well, if you have your wireless carrier as part of this, you're going to lose that cyclicality. People will just stick around permanently. And that could really be something that I think Amazon takes as a boom. And hey, I mean, wireless prices are pretty expensive. If you can wrap that into $139 a month, plus the Prime delivery, I take that.

- Same, Dan Howley. I mean, and when you said T-Mobile is not a part of it, I'm like that's fine. I'd be switching from them. So thank you, Dan, for that insight.