Google is moving into the $189 billion market for wireless service with Project Fi, a Mobile Virtual Network Operator (MVNO) created in partnership with T-Mobile U.S. and Sprint.
The service, offered at a starting price of $20 per month, seeks to bring greater affordability and reliability to wireless services. It is also expected to boost Google’s profits by ushering greater traffic to its online platforms. Google’s launched attempt differentiates its service from that of Verizon and AT&T, its longstanding competitors, through a variety of features. With its innovative pricing plan, it credits users for their unused data so that users will only pay for what they use. It also allows users to switch seamlessly between cellular partner networks and Wi-Fi networks, connecting customers to the fastest available network at their location while minimizing interruptions.
Project Fi, with its low price and credits for unused data, has created pressure for the leading telecom carriers, Verizon and AT&T. However, being mostly experimental in nature and limited in scope, Google’s new wireless service is expected to have a limited impact on the market as of yet. The service, currently offered individually and only through invite, faces a limited audience as two-thirds of postpaid subscribers are on multiple lines. Moreover, the service is only offered to users of Nexus 6 cellphones. Google’s entry into the wireless service market marks a familiar attempt to expand its influence in the mobile industry and diversify beyond its core online advertising business. However, as with many of its other ventures, its commitment to the service is at best tentative.