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| Monday, 28 May 2007 | |
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MVNO model must change says report as Qualcomm takes pulse and
A new report, ‘The Future of the MVNO’, published by international telecommunications research and consultancy firm BroadGroup Tariff Services, suggests that mobile virtual network operators (MVNOs) will continue to grow on a global basis – with worldwide subscriber numbers more than doubling for the period from 2007 to 2012. However the report warns that business models and distribution will need to change. The research reveals a wide range of different approaches and MVNO market drivers. According to BroadGroup the mobile market globally is becoming more fragmented with the power of brands and distribution – together with the emergence of new low-cost mobile virtual network enabler (MVNE) aggregators – favouring the development of emerging niche MVNOs based on a small social community. Retailers and non-telecoms companies with strong customer relationships are also using the MVNO model as a marketing tool to broaden and improve their existing customer experience to improve customer retention for their core business. BroadGroup reckons the distinction between pure MVNOs and pure mobile network operators (MNOs) is likely to become increasingly difficult to sustain as the MNO is utilising the MVNO technique of sub-brands or multi-brands to retain loyal customers. As the larger MVNOs grow their subscriber base they are additionally seeking to develop a post-paid business stream and are adopting the characteristics of the MNO. The report also identifies six broad criteria that determine the most attractive MVNO markets for future investment across 30 countries. “The MVNO model is perceived as a perfect low cost entry vehicle to launch new mobile business models,” comments Margrit Sessions, managing director of BroadGroup Tariff Services. “MVNOs can help lower prices in a market but purely competing on price can not be sustained as a long-term strategy. Developing new business models and distribution will be key to success. To compete in a market purely on price is not a winning strategy.” The judgment that MVNOs have to move on comes as reports in several US trade publications have wireless technology innovator Qualcomm prepping to enter the fray in partnership with others in a healthcare-focused MVNO called LifeComm. The USP here seems to be the combination of regular cell phone capabilities with specialist over-the-air health monitoring and alerting. There are also reports that the cosmetics group Avon is launching an MVNO in John Williamson |
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