MVNO aims to put the ‘Chat’ amongst the pigeons

20 Mar 2012

AppChat, the mobile voice specialist founded by former ECN Telecommunications CEO John Holdsworth, will launch as a mobile virtual network operator (MVNO) in South Africa later this year, TechCentral reports. Although Holdsworth has yet to confirm which mobile network operator (MNO) will host the service, an official announcement is expected to be made within the next month. The MVNO, which is expected to launch in October this year, intends to slash voice calls by as much as 50%. Holdsworth told TechCentral: ‘MVNOs can now compete on price. They can make their off-net minutes cheaper than the incumbents’ on-net minutes. We are already seeing carriers like Orange in Europe using data networks to carry voice. It’s just a matter of time before that happens in South Africa’. Unlike traditional MVNOs, Holdsworth has indicated that AppChat will install its own core network switches and negotiate its own interconnection agreements with the network operators, allowing it to better manage its costs. The company is implementing a core IP network with points of presence (PoP) in Johannesburg, Durban and Cape Town.

According to TeleGeography’s GlobalComms Database, South Africa is currently home to three MVNOs. Virgin Mobile South Africa, initially a joint venture with MNO Cell C, launched in mid-June 2006 planning to target the high-end market, whilst late 2009 saw Econet Wireless South Africa inaugurate services, once again piggybacking on Cell C’s network; the MVNO offers expatriate customers discounted call rates to Zimbabwe. More recently, February 2011 saw a third MVNO, Red Bull Mobile, begin offering services, again over the Cell C network.

However, Holdsworth does not intend to take his inspiration from his local competitors, which in his opinion have failed to run ‘lean-and-mean’ operations. ‘The really successful MVNOs worldwide have operated along the no-frills model. Telmore completely reconfigured the mobile market in Denmark with a low-cost and no-frills operation’.

South Africa