MVNOs unveil deals to woo customers away from big three

10 Jun 2014

Chinese mobile virtual network operators (MVNOs) due to launch later this month have begun unveiling preliminary voice and data plans as the regulator’s two-year MVNO experiment prepares for kick-off, the South China Morning Post reports. According to local reports, the plans revealed offer a greater level of flexibility than those of the three network operators, including allowing subscribers to carry over unused data to the following month – an option which has been widely called for by the public but dismissed by the incumbents. Ali Telecom, the MVNO established by HiChina, part of e-commerce giant Alibaba Group, has announced that it will not levy a fixed monthly fee, but will charge customers based on the amount of data used, counting voice and SMS as data for billing purposes. Ali is yet to confirm speculation that it will also offer subscribers additional privileges when using Alibaba’s online shopping sites.

The Ministry of Industry and Information Technology (MIIT) has issued licences to 26 Chinese firms to launch MVNO services as part of a two-year trial to introduce greater competition into the mainland’s mobile market. Industry stakeholders have cast doubt on the potential impact of MVNOs on the sector with several challenges posing major obstacles to the newcomers, not least of which the high prices levied by network operators for the use of their infrastructure, a situation only made worse by recent retail price cuts introduced by the ‘big three’ – China Mobile, China Unicom and China Telecom. Another substantial barrier to MVNOs is the absence of mobile number portability (MNP), meaning that customers switching to a new provider must be given a completely new phone number.