Amazon Wireless? How Jeff Bezos' Company Could Soon Compete With AT&T, Verizon

As T-Mobile and Sprint aim to form a new wireless carrier, online retail giant Amazon (AMZN) could benefit from the deal.

In order for Sprint and T-Mobile to go through with their $26.5 billion merger, the Chairman of the Federal Communications Commission has required T-Mobile to divest Boost Mobile in order to carry out the deal. Amazon has signified interest in snapping up Boost Mobile and possibly entering the wireless market, Reuters reported Thursday.

Shares of both AT&T (T) and Verizon (VZ) were both down 4% on Friday amid talk of Amazon entering the wireless market. Amazon could soon be selling phones with its own Amazon-branded wireless service.

Yahoo Finance reported how one analyst called Amazon "crazy" to enter the wireless market, while another analyst said Amazon's possible acquisition of Boost Mobile could serve as a "trojan horse" to kill off other wireless services. In the past, Amazon has had to insist that it is not a "monopoly" due to its influence on the retail market in the U.S.

By acquiring Boost Mobile, Amazon could not only enter the wireless market but also improve its cloud systems and gain more control over the services it already offers. One such service is video and music streaming service Amazon Prime.

"In a 5G world, the opportunity from wireless for Amazon could include everything from managing warehouses ... to reducing churn at Prime," Barclays analyst Kannan Venkateshwar said in a note Friday.

The merger of Sprint and T-Mobile would leave the U.S. with three major carriers instead of four, raising concerns that wireless prices could increase. If Amazon decides to buy Boost Mobile, it would face scrutiny from the Justice Department, due to issues to preserve competition in the wireless market.

Amazon could face a competitor in buying Boost Mobile. Peter Adderton, the founder of Boost Mobile, sold Boost to Nextel in 2004 and told CNBC in May he would be interested in buying the company back depending on the terms of the deal.