Why now is the perfect time to consider the MVNO opportunity

Written by on March 24, 2017 in Opinion with 0 Comments

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Becoming an MVNO today is a very different proposition from 10 years ago. Then it was about offering a cheaper service or providing better value than the network operator you were chained to.

Virgin was perhaps the only company that realised that it could sell on brand. And it did so very well. The industry laughed when surveys said that its network was the most reliable, and that the network that Virgin used was the least reliable. Perception, as they say, is everything.

Today, there is little or no point selling or reselling capacity, voice, texts, data or what is now the infrastructure of the digital world. Ask a Millennial who their operator is and they will have no clue, no idea. Ask the same – or a different – Millennial what services their operator provides and the answer will be the same blank stare.

Today, everything comes down to the device.

Innovation starts there. For many, the network, and its operator, are sadly meaningless. Which is why a growing number of network operators are reinventing themselves via MVNOs. It also helps with the legacy problem, but that is a different story.

As a brand – a retailer for example – the opportunity is huge. If your customer picks up his phone (let’s call it a phone for old times’ sake) in the morning and the first thing that he sees is your logo, that must be good. And if you are clever, then you can do what network operators have failed to do until now – offer him personalised products and services, that you know he actually wants. Take Tesco as an example. Tesco is extraordinarily adept at offering their customers what they want, sometimes what they don’t even know they want. One classic example was a customer who had had a loyalty card for years and was offered money off dog food. He had never bought dog food from Tesco in his life. Presumably his profile led Tesco to believe that he was a dog owner.

And they were right. Apparently, despite the many millions of Tesco customers who have loyalty cards, only six will be offered the same promotions.

Many brands are realising the MVNO potential. The power of being able to ‘be’ the device that people carry around with them is amazing. Whether you are Burberry, Tesco or Disney, being in people’s pocket is where you want to be.

The trick is to be independent of the network and to be able to completely tailor your offerings. You need your own SIM so that you are network independent. You need to take full advantage of the flexibility and cost savings available through virtualisation.  As Robert Machin at Openet recently commented ‘here as in many other digital businesses – and any new MVNO will be nothing if not a digital business –  functional virtualisation is replacing costly physical platforms, while outsourcing and cloud-based solutions are making investment in licenses and skills largely unnecessary. The MVNO need only invest as it grows, taking considerable risk out of the initiative’.

The cost base for an MVNO now, compared to several years ago is small. The flexibility is large.

Right now the power of a brand is tantamount. Many are taking, or considering this opportunity. And being ready, with the right tools, is vital.

And while we are thinking outside the box, in this world of connected things, anything is a device.

A car is a device.

Intel is not buying Mobileye because it thinks that an Israeli start up that is very good at collecting data is the thing to own nowadays, it is because it values the data produced by a car – or many, many cars – to be worth the $15 billion asking price.

If you are an operator, brand, retailer or – well, just about anyone – and considering the potential to take loyalty, customer experience and all the things that these mean to the next level, you should consider attending next month’s MVNO World Congress in Nice.

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Alex Leslie

About the Author

About the Author: Alex was Founder and CEO of the Global Billing Association (GBA), a trade body focused on the communications sector. He is a sought after speaker and chairman at leading industry conferences, and is widely published in communications magazines around the world. Until it closed, he was Contributing Editor, OSS/BSS for Connected Planet. He is publisher of DisruptiveViews and previously BillingViews. .

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