British supermarket giant Tesco is said to be in discussions with bankers with a view to putting its mobile virtual network operator (MVNO) subsidiary Tesco Mobile up for sale, as part of efforts to divest non-core assets, the Financial Times reports. According to people with knowledge of Tesco’s operations, the MVNO business could be worth ‘hundreds of millions of pounds’, based on the fact that its share of the telecoms service provider’s profits is around GBP100 million (USD154 million) per annum. Tesco Mobile is a 50/50 joint venture between the retailer and mobile network operator (MNO) O2 UK, and is currently the UK’s largest MVNO by subscribers, with an estimated 4.2 million customers on its books as at end-2014. While co-owner O2 UK has been suggested as one of the more likely companies to acquire the virtual operator, such a development is likely to be complicated by the fact that the cellco is itself in the throes of being acquired by Hong Kong-based Hutchison Whampoa, the owner of Three UK (Hutchison 3G UK).
Elsewhere in the UK, BT Group has announced that its recently launched SIM-only BT Mobile MVNO unit attracted over 50,000 customers in its first six weeks of operation. BT Mobile is currently only available to existing BT broadband subscribers, and offers bundles of 4G data, minutes and texts as little as GBP5 (USD7.7) a month. The future of the MVNO remains unclear, going forward: CEO Gavin Patterson confirmed that the company’s shareholders have now approved its GBP12.5 billion buyout of network partner EE.
China Unicom has officially been issued with new MVNO number ranges comprising 20 million mobile numbers, in order to meet demand from the 23 virtual operators that have agreed terms with the operator. According to technology website C114, the number ranges include the ‘1707’ and ‘1708’ prefixes. Previously, the Ministry of Industry and Information Technology (MIIT) issued China Unicom with the prefixes ‘1700’, ‘1705’ and ‘1709’. It remains unclear where the perceived demand has come from; China’s leading MVNO Snail Mobile claimed just one million users in March this year.
Last week, Spain’s telecoms regulator the Comision Nacional de los Mercados y la Competencia (CNMC) ordered Orange Spain to give rival operator MasMovil temporary access to its 4G network within the next ten days after accusing the cellco of a ‘clear breach’ of the contract it signed in May 2013. Under the terms of that agreement, Orange was committed to providing a wholesale 4G service within a ‘reasonable’ timeframe. However, after Orange failed to provide a complete wholesale offer encompassing 4G, MasMovil requested intervention from the CNMC in November 2014.
Elsewhere in Spain, MVNO Pepephone has decided to stop migrating its customers from the Vodafone network to that of rival MNO Movistar, after alleging that the service provided is not the same as that received by Movistar’s own customers. In a blog post, Pepephone said it had run a number of ‘independent technical checks’ to demonstrate that its customers ‘are not receiving the same service as the remaining customers of the network’. The MVNO added that it has contacted Movistar and asserts that the problem is due to ‘a difference in settings and optimisation’.
UPC Cablecom has opened up its mobile offer to the whole of Switzerland. Previously, the product was restricted to existing subscribers, with a requirement for would-be users to take another service from the operator. The new MVNO, which piggybacks on the Orange network there, claimed just 8,800 subscribers as of 31 December 2014.
South African mobile operator Cell C plans to stop selling Red Bull Mobile products on 31 May 2015, Tech Central reports. Red Bull Mobile was launched in 2011 in partnership with Cell C. The partnership, which leveraged the energy drink’s brand, was planned to offer South Africans competitive mobile prices. Cell C then relaunched Red Bull Mobile in 2013, which had seen its user base stagnate at just 120,000 customers. Cell C spokesperson Karin Fourie commented: ‘Cell C and Red Bull have mutually agreed to focus on different strategies, hence the conclusion of the partnership. Existing pre-paid, post-paid and hybrid customers will be migrated to similar Cell C tariff plans.’ The development coincides with a period of renewed activity within the country’s MVNO sector. Last week South Africa’s newest MVNO me&you mobile launched over Cell C’s infrastructure, offering SIM-only services to clients. me&you mobile, which is part of the Durban-based Ignition Group, was launched in partnership with sister company MVN-X, the business headed by former Virgin Mobile South Africa CEO Steve Bailey. Meanwhile, South Africa’s First National Bank (FNB) is reportedly planning to launch an MVNO offer shortly.
Ting Mobile, the US MVNO which piggybacks on Sprint Corp’s CDMA-based network, has reported that its subscriber growth in the first quarter of the year suffered badly as a result of the decision by its host MNO to implement a new unlocking validation process in February, dubbed ‘Financial Eligibility Date’ (FED). The new process has been set up to ensure that any unlocked Sprint device activated on another carrier’s network has been paid for in full by the customer who entered into any contract or deal with Sprint. Whilst it has been a sensible financial move for the MNO, it is said to be causing the MVNO headaches, with ‘many’ Ting customers finding themselves deactivated. Prior to the new regime, Sprint had operated more relaxed ‘Bring Your Own Device’ (BYOD) programmes, but with FED it changed its rules for devices that customers might want to take to other carriers and MVNOs, including those for parent group Tucows’ Ting Mobile service. In its Q1 earnings call, Tuscows CEO Elliot Noss said that ‘70% of devices that people were trying to activate on Ting were rejected following Sprint’s implementation of FED’. With the two sides working to resolve the issue, Ting says that it is now getting back to ‘an acceptable level of service, but in Q1 it was only able to add 9,000 accounts and almost 16,000 devices to its user base – well below the average 12,000 accounts and 18,000 devices added in previous quarters; note, Ting allows multiple devices on the same user account. The virtual operator reported a total of 94,000 active accounts and 147,000 active devices at the end of 2014 – an effective doubling of its subscriber base in just one year.
The US mobile market has welcomed another new player in the shape of UVA Mobile which is launching what it calls a ‘premier’ pre-paid service using the GSM and LTE networks of T-Mobile US. UVA Mobile, whose backers include a number of former executives of Cricket Communications – which was acquired by AT&T, Simple Mobile, which was bought out by America Movil (AM) and merged with Tracfone, and Qualcomm – is based in San Diego and was borne out of EvoNexus, a California-based tech incubator. UVA Mobile is looking to offer a non-contract, SIM-only offer, compatible it says, with a wide range of T-Mobile US devices and other unlocked GSM-based handsets. The new service will comprise a bouquet of five voice/data options all costing USD50 per month to be shared across two lines. The options break down as follows: 500MB of data and 4,000 domestic voice call minutes; 1GB of data plus 3,500 minutes; 2GB of data and 2,500 minutes; 3GB of data and 1,500 minutes; and 3.5GB of data and 1,000 minutes. Further, all UVA call plans include 5,000 SMS and a USD5 credit towards international long-distance calling, while users can also pay USD10 per month for an additional 1GB of data, 1,000 call minutes or unlimited SMS texting. The MVNO is currently trialling its service, adding that it will be late-June before full commercial services are available.
The Telecom Regulatory Authority of India (TRAI) has issued recommendations on the introduction of virtual network operators (VNOs) into the Indian mobile market. The regulator acknowledged that whilst VNOs could drive up penetration, minimise the digital divide and increase competition, in some areas their arrival could prove more disruptive than beneficial. The watchdog is reluctant to use its powers to crowbar VNOs into the market and has proposed instead that VNOs should begin operations only through ‘mutual agreement’ with network service operators (NSOs), commenting in a statement that: ‘The terms and conditions of sharing the infrastructure between the NSO and VNO are left to the market to determine.’
QBoCel is the latest MVNO to launch in Mexico, following a year of planning, according to El Economista. The newcomer is operating over the nationwide network of Telefonica’s Movistar Mexico subsidiary, and is targeting 180,000 customers – mainly education sector employees – in the first year of operation, and ‘over a million’ users by 2017, after investing an initial MXN103 million (USD6.7 million) in the launch. Mexico’s National Union of Education Workers (SNTE) previously announced that QBoCel ‘is a new communication proposal that offers solutions of mobile and digital communication tailored to the SNTE and its members and is present throughout Mexico with the highest quality and coverage,’ while the first customers to be given access to the network were exclusively teachers belonging to the SNTE. Movistar currently hosts four other independent MVNOs in Mexico, namely Lycamobile, Maz Tiempo, Virgin Mobile and Ekofon (Cierto), in addition to its own Tuenti sub-brand.
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