X
<

Latest Update on Amazon, Walmart, and Alibaba

PART:
1 2 3 4 5 6 7 8 9 10 11 12 13
Part 8
Latest Update on Amazon, Walmart, and Alibaba PART 8 OF 13

Amazon–Dish Partnership: A Potential Catch for Amazon

Package delivery drones

There is no shortage of potential benefits for Amazon (AMZN) in investing in a wireless service with Dish Network (DISH) or any other partner. In addition to being able to add a phone plan to Prime subscriptions, Amazon could also use the wireless investment to strengthen its other operations.

For example, the company could use the wireless network to enhance the operations of its package delivery drones. Amazon has shown that it is planning to deploy drones to deliver customer orders to reduce delivery time and cut operating costs. 

Amazon–Dish Partnership: A Potential Catch for Amazon

Interested in AMZN? Don't miss the next report.

Receive e-mail alerts for new research on AMZN

Success! You are now receiving e-mail alerts for new research. A temporary password for your new Market Realist account has been sent to your e-mail address.

Success! has been added to your Ticker Alerts.

Success! has been added to your Ticker Alerts. Subscriptions can be managed in your user profile.

Shipping expenses are among Amazon’s rising operating costs, as the company relies on third-party shippers to deliver orders to customers. The chart above shows how Amazon’s shipping costs have trended over the last five quarters.

Efficient delivery system

Although using drones and a wireless network could help make Amazon’s delivery system less expensive and more efficient, funding the building of a wireless network could come at a steep cost to the company. 

According to reports about the Amazon–Dish discussions, Amazon would contribute capital toward establishing a wireless network using Dish’s spectrum.

Costs of building a wireless network

If network investments by carriers such as Verizon (VZ), AT&T (T), T-Mobile (TMUS), and Sprint (S) are any guide, the cost of setting up a reliable wireless network could be considerable. As such, financing a wireless venture with Dish could dramatically increase Amazon’s expenses.

X

Please select a profession that best describes you: