Amazon quietly plans to offer customers a convenient new service | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

These past few months, the telecom industry has been suffering from a drastic change in customer behavior.

It is no secret that for years, cable companies have gradually seen a mass exodus of TV customers who have switched to streaming services for entertainment. However, these companies are also surprisingly starting to see their internet customers cut the cord on services.

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Cable giants such as Comcast and Spectrum lost a higher-than-expected number of internet customers during the first quarter of this year after implementing price increases.

A recent survey from Cord Cutters News revealed that now only 40.2% of consumers rely on cable TV companies for their internet service, which is a startling decline from 45% in late 2024.

Also, about 35% of consumers have now switched to fiber-optic internet, up from 29.1% in 2024, and roughly 11% rely on 5G home internet, an increase from 8.4% just a year ago.

Amazon will launch a new service to better serve areas with poor internet coverage.

Image source&colon; Bloomberg/Getty Images

Amazon customers will soon have access to a brand-new service

As consumers across the country explore non-traditional internet service options, Amazon (AMZN) is planning to get its feet wet in the broadband industry.

The online retail giant plans to launch a satellite internet service by the end of this year in areas with poor coverage worldwide.

For the first time, Amazon launched low-Earth-orbit satellites into space in April and June, through an initiative called Project Kuiper.

Amazon’s website states that the project’s mission is to “help close the digital divide” by providing “fast, affordable” internet to “consumers, businesses, government agencies, and other organizations operating in places without reliable connectivity.”

Amazon is planning to launch three different tiers of its satellite internet service: one that delivers speeds of up to 100 megabits per second, another that contains a standard antenna with downlink speeds of up to 400 megabits per second, and a model that provides speeds of up to 1 gigabit per second.

BofA analysts predict that Amazon’s satellite internet service will allow the company to generate $7.1 billion by 2032 if it gains a 30% share of the consumer market, especially since roughly 2.6 billion consumers don’t have access to fast broadband internet, according to a report from BofA Global Research analysts, which was obtained by PYMNTS.

“Kuiper is a big investment initiative for Amazon that has endured despite ongoing cost-cutting,” said BofA analyst Justin Post in the report.

Amazon’s upcoming service faces growing threats

The move from Amazon comes as Starlink, SpaceX’s satellite internet service, has attracted over 6 million customers worldwide after launching in 2019.

High demand in rural and urban areas is fueling its rapid growth. Currently, the service is available in over 125 countries across all seven continents.

Some analysts have predicted that Starlink will generate $11.8 billion in revenue by the end of the year.

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The increased interest in satellite internet from consumers also comes at a time when many are flocking to fixed wireless internet services. These services also provide internet access to remote or underserved areas, however, through the use of radio signals.

Fixed wireless internet is cheaper than traditional internet services, and companies such as Verizon, AT&T, and T-Mobile all offer it to customers.

Comcast even flagged during an earnings call in April that it is facing “intense” competition from fixed wireless internet providers.

“I would tell you that the newer competitor in the last few years has obviously been fixed wireless,” said Comcast Chief Financial Officer Jason Armstrong during the call. “They’re adding 1,000,000 subscribers per quarter, so that’s sort of the competitive intensity that we’re seeing that’s sort of incremental. We are competing aggressively with it.”