Why Amazon Is Going to Build Its Own Cellular Network

Yes, I think Amazon is going to build its own cellular network.

But not for phones. For IoT devices that track its global logistics operation.

A few months ago I wrote about new long-range wireless technology that allows anyone to build low-cost cellular-like networks. I predicted then that we’d see new network operators pop up using this new tech. And we have.

But why should the network operators have all the fun? The point of this technology is that anyone can build a network. Covering the US with cell towers is not exactly trivial, but the cost would be a drop in the bucket for a company like Amazon.

And Amazon would benefit in a bunch of ways.

First, their new network would give them months or years of battery life, which would greatly simplify tracking pallets and packages. Most supply-chain tracking today is actually truck-tracking — because trucks have big batteries to power cellular radios. With long battery life, you can track containers or pallets or even individual parcels.

Next, Amazon would be able to put coverage exactly where they need it, starting with their transport hubs and growing from there. Say they park delivery vans in an underground parking garage — Verizon’s not likely to install a $100,000 cell tower to add coverage there, but Amazon could drop in a gateway for a few hundred bucks. Every nook and cranny of their rural distribution centers? Covered. Ports and airports? Done.

Also, they wouldn’t have to worry about the network going away. AT&T is retiring its 2G network this year, so every vending machine and point-of-sale device using that network must be thrown out or upgraded. If Amazon controlled the own network, they could upgrade on their own timeline.

Finally, they could avoid working with cell carriers, who are just kind of a pain in the ass. Certifying a device to work on a cellular network costs upwards of $50,000 and takes months. With your own network, you can just move a lot faster. Also, consider how long you wait on hold when you call Verizon’s billing department. Then scale that up to thousands of devices. You’d need an whole team of people just to manage the bills.

And while we’re listing the benefits, let’s not forget Amazon’s consumer devices.

Dash Buttons use Wi-Fi today, so they need set up. Wouldn’t it be cool if they worked straight out of the box? If Amazon owned their own network, they could. Same with Kindles. They could even put gateway radios into Echos to build out their network quickly — every home becomes an access point for their new network.

1-920f0z5vovpqe4xkoju4ga
A cell tower?

Of course Amazon isn’t the only company that would benefit from owning their own IoT network.

Wouldn’t it be nice if your Nest Protect stayed connected when wi-fi failed? If Nest/Alphabet had their own IoT cellular network, it would. Setup would be seamless for all devices. I’d say the OnHub router would be an interesting place to put a gateway chip.

Security companies could cover a metro region, then drop in battery-powered security sensors with zero installation. You can’t do that with cellular because the batteries would die. Hospitals could track temperatures of medical samples as they travel to labs and back. Farmers could drop down a solar-powered gateway and light up their fields with soil sensors.

You can see why I think we’re heading into an interesting new world.

Drop us your email at the bottom of this page and we’ll keep you posted on this technology and how our company is working to develop it. Thanks!