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Google Fi Tinkers with Plans as Dish Wireless Threat Looms

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Google (GOOGL) has expanded plans for its Google Fi wireless customers with a new service option it launched on September 17. The new plan allows customers to pay a flat monthly fee for unlimited data, calling, and text. Previously, Google Fi only offered a single plan whereby customers paid only for the data they used. However, that meant customers could see their bills swinging wildly from month to month.

Google explained that it came up with the new Google Fi unlimited plan because some customers wanted predictable monthly bills. The Google Fi unlimited plan starts at $70 per month for a single line. The price drops to $45 per line, per month for customers with four lines or more.

Dish to give Google Fi more wireless competition

Google Fi launched in 2015 and runs on network space rented from T-Mobile (TMUS), Sprint (S), and US Cellular. The expansion of the service’s plans comes as competition in the US wireless market is set to heat up. Dish Network (DISH) is gearing up to enter the wireless market.

Like Google Fi, Dish will initially offer its wireless phone service using T-Mobile’s and Sprint’s networks. But unlike Google Fi, Dish wireless will not start recruiting wireless customers from scratch. Dish struck a deal to purchase Sprint’s prepaid business, which had 8.6 million subscribers at the end of the second quarter. As we discussed previously, Dish could make more than $3.3 billion per year from serving Sprint’s prepaid customers alone.

Even T-Mobile admits that Dish could be a serious disruptive force in the wireless market.

“Look, DISH is going to come in. They are going to be a viable competitor….We made sure that the arrangement we have with DISH simultaneously accomplishes our goals and theirs,” T-Mobile Chief Operating Officer Mike Sievert said at the Goldman Sachs Communacopia Conference on September 17.

Diversifying revenue sources

Amazon (AMZN) is gaining ground in the digital advertising market, threatening Google’s base, as eMarketer data shows. As competition for advertising dollars tightens, Google has been working to break into new markets. The company has ventured into selling a range of hardware products, including smartphones and smart speakers. It also provides cloud computing services. Google Fi is one of the businesses Google is counting on to diversify its revenue sources outside the advertising market.

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