In search of the perfect MVNE partner

Tom Erskines
29 Nov 2006

Although the Asia Pacific has been slower than its European and US counterparts to embrace the mobile virtual network operator (MVNO) model, some countries such as New Zealand and Australia have experienced a rise in MVNO popularity in recent years.

According to global wireless analyst firm Ovum, New Zealand alone will have more than 1.5 million MVNO subscribers by end-2006. By next year, MVNOs will likely launch in Japan, Malaysia, Singapore and Hong Kong.

With the growth potential of MVNOs in the region, the need to partner with experienced mobile virtual network enablers (MVNEs) that can help with subscriber care and billing needs also increases.

The success of an MVNO also depends on its ability to cost-effectively differentiate data service offerings. MVNOs who partner with MVNEs can take advantage of the MVNEs' economies of scale to quickly launch these offerings, allowing the MVNOs to put their funds in brand development. Costs are also incremental as MVNOs ramp up with more subscribers; a good MVNE scales as capacity increases.

Working with an MVNE allows the MVNO to focus on strengthening customer relationships and the customization of services, as the MVNE provides expertise in back-office management. However, successful MVNO-MVNE relationships still depend on several criteria to ensure a long-term and profitable partnership.

Long-term benefits

There are lessons MVNOs and potential MVNOs in Asia Pacific can learn from their more experienced American and European counterparts.

An MVNO should aim to be the first entrant in the market. If other MVNOs in the same coverage areas are already offering the same products and services, what can a newer MVNO bring to the table to attract a sizable subscriber base‾

The novelty and excitement of specialized services and customized features created for a specific niche market are the factors that initially attract subscribers to a new mobile service provider. An MVNE can help speed the initial launch by utilizing an end-to-end solution to propel brands faster and farther.

Addressing customer experience is another crucial piece in the MVNO puzzle.

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