How Google might get you better wireless service—without paying them a thing

Google is preparing to offer its own US wireless service, in partnership with Sprint and T-Mobile, the Wall Street Journal (paywall) and The Information (paywall) are reporting.

There are still a lot of big questions, including how expensive the plans will be, where and when they’ll be available, how much Google will try to rely on WiFi, whether it will offer acceptable customer service, and whether it will sell or support the iPhone, the most popular phone in the US. Our initial guess is that Google will at least attempt to offer more flexibility than the leading US wireless companies, AT&T and Verizon Wireless. This might include data-only service plans, free voice calls, or other nice features.

The best hope for everyone, however, is that Google will generate enough attention for its new service that it encourages bigger mobile operators to get with the program.

“With the new mobile phone plan, Google hopes to ‘get carriers to step up’ and improve pricing or networks,” The Information’s Amir Efrati reports, citing “one person briefed on the project.” Similarly, the Wall Street Journal quotes analyst Jan Dawson, saying: “It’s probably an attempt to put pressure on the carriers to improve their own products by showing new ways of offering service.”

Google has tried to play this game before. Last decade, it lobbied the Federal Communications Commission to include “open access” rules for a big chunk of wireless-service airwave licenses that were up for auction, even bidding billions of dollars to trigger those rules. (Verizon Wireless wound up winning the auction.) Open access, it turns out, hasn’t had much of an effect on the wireless industry. But perhaps partially because of those rules, Verizon now sells its 4G LTE smartphones unlocked—a modest but useful victory for its customers, who can use their phones more freely, especially abroad, by inserting other operators’ SIM cards.

Many—myself included—also thought Google’s Fiber program was a head-fake to get cable and phone companies to build out faster broadband networks. It’s impossible to prove cause and effect, but cable companies have continued to increase their broadband speeds.

It’s also worth noting that these types of mobile resale offerings—called “virtual” networks, or MVNOs—largely haven’t succeeded in the US. Last decade was littered with expensive failures, including Mobile ESPN, Helio, Amp’d Mobile, and others. But Tracfone, a budget mobile service owned by Mexican operator América Móvil, has been successful, with roughly 25 million subscribers.

More broadly, it’s hard to imagine Google a long-term, global player in wireless service—it’s just too different from what Google is successful at, and it’s a particularly capital-heavy business. But if Google can somehow use its influence to get faster, cheaper wireless service for more people—who then likely wind up using more Google mobile web services, from YouTube to Google Maps, that sounds like a win-win effort.

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How Google might get you better wireless service—without paying them a thing