19 Jan 2015
UK-based self-styled ‘ethical MVNO’ The People’s Operator (TPO) has revealed plans to launch a sister MVNO in the US this spring, pending regulatory approval. In April 2014 the company entered into a deal with US carrier Sprint Corp to piggyback on its network, and a commercial launch is now imminent. Going forward, TPO also intends to enter a number of other territories in the near future, with expansion being considered in Mexico, Brazil and other markets across Asia and Europe; negotiations are expected to take place over the course of the next 18 months. TPO hopes to win a 2% share of the UK and US markets by 2021. In December 2014 the company was admitted to the Alternative Investment Market (AIM) of the London Stock Exchange, raising approximately GBP20 million (USD30.27 million) before expenses through the placing of 15.38 million ordinary shares (at GBP1.30 each) with institutional investors. TPO, which is led by Wikipedia founder Jimmy Wales, allows customers to direct 10% of their monthly bill to a charity of their choosing. Another 25% of revenue goes to the TPO Foundation. As at 31 December 2014 it claimed a total of 14,032 subscribers, up from 5,800 six months earlier. The virtual operator, which launched in November 2012, is hosted by EE’s network.
China’s 41 MVNOs accounted for 2.1 million subscribers by the end of 2014, with the top four representing 1.67 million users between them. According to online news journal C114, Snail Mobile, the wireless business of video game company Snail Games, is the largest MVNO in the country with 670,000 customers signed up to its services, while electrical appliance manufacturers Suning and Gome had signed up 500,000 and 300,000 subscribers respectively to their Suning Mobile, Gome G++ services, and e-commerce firm Alibaba had around 200,000. Elsewhere, D-phone, Aisidi and Telline had around 100,000 users apiece, and Bus Online and Jindong counted fewer than 100,000. China’s Ministry of Industry and Information Technology (MIIT) began issuing MVNO licences in 2013 as part of a two-year trial programme to test the potential effectiveness of virtual operators in increasing competition in the wireless sector. The MIIT expects subscribers to virtual providers’ services to reach 50 million by the end of 2015, although given the slow rate of growth so far, and the difficulties faced by MVNOs, the end figure is likely to fall short of that target.
Juan Rivadeneira, Claro Peru’s director of regulatory affairs, has argued that in spite of indications to the contrary, the country’s mobile market is not yet ready to support the launch of MVNOs. The official has been quoted by local press sources as saying that Peru’s mobile infrastructure is sorely lacking, and the introduction of virtual operators will lead to network congestion. He has claimed that Peru has just 9,000 base transceiver stations (BTS) in service, while countries with healthy MVNO markets such as Chile or Colombia, both have more than 30,000 cell towers in operation. As previously reported by MVNO Monday, Peru’s deputy communications minister Raul Perez Reyes suggested that regional MVNO heavyweight Virgin Mobile Latin America (VMLA), US telco AT&T and Chilean retail group Falabella had all expressed an interest in entering the Peruvian market.
Chilean triple-play provider VTR has defended its decision to become an MVNO last year, abandoning its network in the process. Speaking to officials at a meeting of the country’s Tribunal de Defensa de la Libre Competencia (TDLC), company officials argued that it was unable to cope with the rapid pace of technological change within the mobile market, forcing it to an embrace an MVNO set-up instead. The operator launched its own network in May 2012, using a hybrid model combining its own platform with a roaming agreement with Movistar. In early 2013 VTR began to explore alternative models to reduce costs and September that year saw the telco migrate all traffic to Movistar’s network. In December VTR expanded its agreement with Movistar to a full MVNO pact, eventually switching off its own network the following month.
Taiwanese electronics manufacturer Foxconn has partnered with CDMA operator China Telecom through its Chinese subsidiary Xunjie to provide mobile services via an MVNO agreement. Xunjie’s mobile services will initially target the manufacturer’s more than one million employees and their families on the mainland and Taiwan. Foxconn will become the first Taiwanese company to acquire an MVNO licence in China.
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