When you’ve analysed the MVNO market as extensively as we have, you discover there are 2 types of MVNOs:
History shows the MVNO market is cyclical. First, MVNOs show up in waves; after some time, consolidation takes place and larger players are created; these then merge with, or are purchased by, one or more of the MNOs in the marketplace. This story repeats itself again and again and again…
In the first phase, the MVNO market was dominated by players with a very similar strategy to the existing operators. They built up large organisations and distribution networks, subsidised terminals and acted more or less like the operators that they competed against.
In the second phase, discount/no frills MVNOs entered the marketplace, betting on a SIM-only concept and using the internet as their distribution channel. Then large retailers came on board, with the big supermarket chains as their poster boys. These entities exploited the large traffic that came through their stores to sell their customers prepaid products.
However, the future will see the entry of a range of new players differing from the MVNOs that we know today. We’ll see players who base their offering around, for instance, distribution, media, VAS or technology. Simply put, the future will be all about adding value to the market and creating exciting solutions that combine the products you already sell with the new possibilities offered by the mobile universe.
Players able to attract customers while generating traffic at the lowest cost – and more effectively than an MNO – have a chance in the MVNO market of the future. The rest will die.