According to a report from The Wall Street Journal, Google has struck deals with T-Mobile and Sprint in the United States that will allow it to sell wireless service directly to consumers.
At the moment, it is not yet clear when the company plans to start offering the service to consumers, how much it will charge for it, and more.
Sprint is the third largest carrier in the United States followed by T-Mobile at fourth. Both carriers have signed wholesale agreements with Google that will allow the latter to act as an MVNO and sell wireless service under its own brand name to consumers.
Google’s entry into the mobile-phone business would create a new headache for an industry already struggling with a price war and soaring costs for wireless spectrum. Sprint executives are betting that the boost from an influx of new Google customers outweighs the risk that the Internet search giant will learn too much about the ins and outs of the wireless business.
Sprint has, apparently, also included a volume trigger in its contract that will allow it to re-negotiate with Google after its MVNO user base swells beyond a pre-defined limit.
According to one of the sources familiar with the matter, Google has been working on this project, codenamed “Nova,” for over a year and is being led from the front by Nick Fox. The company aims to widen the access to cheaper and faster Internet in the United States through this move.
Google had first approached Sprint nearly 18 months ago, but the deal took its own sweet time to close, especially since Sprint executives were worried that Google might become a disruptive force in the industry.
It is likely that Google will first start its MVNO on a smaller scale in a selected city or by offering subscriptions to its existing Google Fiber broadband users.
[Via The Wall Street Journal]