There are nearly 50 different MVNOs competing for subscribers in China alone, a clear sign of a breakthrough considering that it has only been two and a half years since China’s regulators issued licenses to MVNOs in this market.
These new MVNO brands are targeting niche market sectors and individual customers with a personalized mobile experience, seizing on an opportunity missed by the more established MNOs.
However, the market reality is that competition is only going to increase for MVNOs – they have to compete against an influx of other MVNOs in the market, as well as the established incumbents.
Differentiation is key, and success for the MVNO is about ensuring that they are able to cater to the specific needs of their customers, delivering what they want in real-time.
Unlike their MNO counterparts, today’s MVNOs can take advantage of a new generation of technologies specifically focused on monetizing digital services. Many MNOs, meanwhile, are weighed down by systems and processes that weren’t designed to meet the challenges of Asia’s demand for digital services.
Today’s consumer wants to be able to interact with their service provider in real-time, instantly making purchases, regulating usage and tailoring their mobile package to suit their needs. This provides them with increased levels of satisfaction and brand loyalty, realizing that their digital mobile experience is one that is optimized for their lifestyle.
MVNOs are able to service this requirement faster than the MNOs, largely due to the fact that they don’t own legacy network assets, and can employ technologies that provide them with flexible, agile, innovative capabilities.
These capabilities are encompassed by agile BSS systems that provide the real-time interactive account transparency, management and service delivery options required by consumers. They enable MVNOs to launch differentiated propositions with new offers and rapid price plan changes that subscribers can access on demand.
In turn, this capability can be wrapped into self-care apps that reduce the cost of customer interaction associated with a call center option. This supports reduced cost-to-serve models that successful digital businesses rely on.
Such an attractive business proposition puts digital MVNOs in a prime position to negotiate unique and exclusive deals with content and technology partners, and OTT players. They can instantly bring together everything needed to supply and deliver whatever content their customers’ desire.
However, the opportunity does not suggest that everyone will succeed – as many as 80% of worldwide MVNOs will fail to make it past initial phases. Furthermore, MNOs are beginning to rethink their digital strategies, and are also considering news ways in which they too can inject real-time capabilities into their networks and interact with customers in the same fashion as digital MVNOs.
To succeed, MVNOs must pursue a strategic approach to become retailers of digital services. This is a market that Ovum predicts will grow to $43 billion by 2019 – the same year that MVNO subscribers in China are expected to hit the 100 million milestone.
To take advantage of this opportunity, MVNOs must play to their strengths – they benefit from not having to own and operate the physical network assets, and can instead focus their efforts on service delivery, derived from a powerful virtual proposition.
If an MVNO can employ next-generation BSS systems that leverage the opportunities of real-time interaction and commerce, it will be interesting to see how other MVNOs and MNOs keep pace as subscribers turn to digital brands that let them make the most of their service plans.
Jennifer Kyriakakis is founder and VP of marketing for Matrixx Software