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AH Primetime: Five Reasons Why Google Would Fail Or Succeed If They Launched An MVNO Service

January 27, 2015 - Written By Justin Diaz

Google has brought a great many services to millions of users worldwide, and they seem to have endless innovation and seek to ever expand their growth by exploring new areas of industry. Some of Google’s projects fail, and some of Google’s projects succeed, and the latest undertaking that is still just a rumor at this point is that Google will be gearing up to launch an MVNO service(mobile virtual network operator)under Sprint and T-Mobile who are the current third and fourth largest national wireless carriers. While Google’s efforts to bring wireless service to the masses(at least if this rumored service pans out to be more than a rumor)is something that many end users would likely be happy to see, industry analyst Phil Goldstein of Fierce Wireless believes that Google may have quite a difficult time deploying a virtual network for various reasons, mind you these are reasons based on what little information has been provided about this possible venture of the search giant up to this point.

The first is that Google has literally no experience in manufacturing or engineering handset radios. It also lacks any sort of experience in building a wireless network. This is true, Google is not in the business of engineering wireless radios or building up a wireless network for those radios to connect to. Then again, does it need to have experience in these areas? Manufacturing phone radios is not something Google needs to likely worry about because a handful of high end devices already support nearly all bands that run on multiple carriers here in the U.S. The phone manufacturers take care of this already. The Nexus 5 for example comes unlocked and can be used with either Sprint, T-Mobile, or AT&T networks. The most current Nexus smartphone, the Nexus 6 device, works in the exact same way. So do a number of the iPhones. In this regard, all Google may need to worry about is handling the points of access where whatever phones they offer on their network would switch off to. The WiFi networks. Google already offers WiFi connections at all 7,000 Starbucks locations around the U.S., and while this is hardly enough to support the kind of call switching between networks they may be looking to achieve, it’s not a bad example of how Google could give subscribers a way to move between different network types. Google also offers city wide WiFi in Mountain View, so thinking about something like this on a smaller scale of multiple various points around major cities, Google could make it feasible for users to rely on WiFi a good portion of the time and then revert to the best network for their location when WiFi isn’t available. As far as determining which network would be best for any given device to rely on for coverage, Google could potentially patch the software to make this determination. While have no idea how or what Google would do to make this work, this seems like a possible solution, and Google could easily work with the carriers on this step if they needed to.

Another hurdle for Google would be how to handle customer service operations, as well as how to distribute their products which would be used with their service. Google could have a challenge in this department as customer service is not their specialty. Opening up customer service centers is something that Google would potentially have to look into, as operating a wireless network is no small task and there needs to be people ready to answer and handle calls from customers if any issues arise over any number of different problems, ranging from billing, to technical handset issues, network problems etc. It’s not known how Google would plan to attack this issue head on, but if they don’t have a plan in mind they could have a tough time with keeping customers happy when there’s no one on the other end of the phone to assist them when things go wrong, and things will go wrong from time to time. When it comes to distribution though, Google already has Google Play, and while it may not be ideal, it’s an option that is already up and running and all they would need to do is list and sell products from their service alongside the devices they already offer there. People are also already familiar with Google Play as a place to buy Google related products, and there’s no reason why Google couldn’t make this work. Customer service could also easily be handled by another company that Google hires on to do the job, or they could try and set up something like what Amazon has done with their more recent Amazon Fire devices that include the Mayday button.

Goldstein also points out that advertising is another area where Google would need to develop substantial focus if they were to make any sort of dent in the industry. Shaking things up by offering wireless service is going to require that customers know who you are, and that you’re out there and that you exist. Without advertising on a fairly large scale, a Google MVNO would never last as they could end up spending more money to operate than they get back in returns from customers subscribing, caused by not enough exposure of what they have to offer. However, Google has more recently been ramping up its advertising efforts for products, and let’s not forget that most of Google’s profits come from Ads. Sure, their Ads business is not exactly the same thing as the advertising carriers do for their services, but if there’s one thing out of this entire article Google seems to have a handle on it’s advertising. All they need is to do more of it. Lots more, and make sure that people are aware of what they have to offer. As I stated, most of Google’s revenue comes from ads, and they have plenty of places to inject advertising for an MVNO should they decide to launch one. YouTube, Google, Google+, and virtually any other website that gets accessed by the millions of users with its Chrome browser are all excellent places for Google to advertise on a massive scale in addition to spending more through commercial adverts and other forms of media. Google could even use Google Maps to display their coverage area with an easy way to see all possible hotspot points where there service would work off of WiFi.

Google will also need a way to stand out. How would it set itself apart from the services that other carriers are offering? What would it do to grab the attention of potentially millions of subscribers? As Goldstein points out other MVNO’s already offer the capability to move back and forth between WiFi and their own cell networks depending on which connection is the best for a customer at any given point in time. Republic Wireless is one such example. Google will certainly need something more than the fact they would allow people to move between wireless carrier networks and WiFi to create a seamless connection for customers. If Google plans on running the MVNO off of both Sprint and T-mobile though, that could be their niche. Sprint and T-mobile have different coverage ranges and there are undoubtedly some areas where one service may work better than the other, and allowing your customers to connect freely between the two of them as well as WiFi is something that no MVNO currently offers. This could be one factor that could help Google as an MVNO succeed.

Based off of the rumors thus far, Google also wants to shake up the industry as we stated earlier. To do this Google will have to do a lot of things right here, and all of them would seemingly have to help amount to Google gaining a substantial amount of subscribers. Google has deep pockets, and it isn’t out of character for them to try new things and throw money into an investment whether it pans out or not in the long run. What would be out of character for them would be continuing to offer a service that isn’t getting them back a significant return investment. If Google isn’t able to grab up enough subscribers over a specific period of time, Google could likely shut down a much sought after Google Wireless service that so many people would love to see. However, perhaps Google’s vision of shaking up the industry is different than we are all imagining. It’s hard to tell as there are no real details as to most of what a Google Wireless MVNO would include. Google could end up succeeding with their MVNO by simply getting the wireless industry to change up the way they do business, which may also be hard to envision without a substantial subscriber base to make the other carriers take notice, but there are too many unknowns at this point to really give an accurate depiction of how things could either soar or plummet.