The MVNO

The following is an except from an Instat newsletter I received today. I thought it worth of sharing.

CTIA’s Number One Jeopardy Category: Ends in "O"

"Alex, what is an MVNO?"
Mobile Virtual Network Operators (MVNOs) seem to have caught the attention of CTIA goers (only five years late the way I figure it). The most astonishing sight was the impeccably dressed Sean "P. Diddy" Combs as he addressed the Monday morning keynote audience. Complaining about the early hour of the morning’s party, the rap impresario declared, "I am an MVNO." He backed it up by explaining, "I tell people what music to listen to, what clothes to wear and I can tell them what cell phone to use, too." Look for a "Bad Boy Entertainment" cell phone coming to a store near you.

There were several other places in which MVNOs showed up, including presentations by ESPN, which is planning a launch of its own MVNO by the end of the year. Leap Wireless, which just emerged from bankruptcy, has gotten up off its green couch and started paying attention to each of its unconnected cities individually, where they discovered very different demographics. As a result, Cricket Communications is relaunching itself MVNO-style, targeting the Hispanic populations of southern Arizona and the retirement-age White population in Pittsburgh. Cricket is also expanding its prepaid offering, following the lead of Virgin Mobile, the original MVNO.

Why is this important. My friends, it is all about bundled services and if you are in the VoIP business you gotta have some sort of bundles… Ways to differentiate yourselves. Will you offer, TV, Tivo, MVNO services, e-mail, firewalls, virus scanning, storage services? Whatever you offer you will package it and bundle it in different ways. What is the best way to uncommodotize our market? Go up-market. Sell premium packages. Call it something different. Make it interesting. SNET (now SBC) has done this for years with something called TotalPhone that was a bundle of different services for a good price. The future of VoIP is bundling. I have seen the future and it is part MVNO.

  • Patrick Zimmer
    July 25, 2005 at 8:39 am

    Mobile Virtual Networks Operators (MVNOs) leverage the existing capabilities of wireless carriers to create unique offerings for their customers. MVNOs are not wireless carriers.
    Leverage and Uniqueness are critical concepts for an MVNO to understand. MVNOs leverage the existing wireless infrastructure, they are not creating their own. To create value MVNOs must differentiate themselves by being unique.
    Successful MVNOs will leave technical details to the experts and focus on developing unique ways to motivate customers to spend with them.

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