MVNO Monday: a guide to the week’s virtual operator developments

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11 Apr 2016

Mikkel Vinter, the CEO of Virgin Mobile MEA (VMMEA), has confirmed to CommsMEA that the company has reached the 2.5 million customers milestone across its five regional MVNO operations. These operations include the MEA region’s first MVNO service in Oman, and its Saudi Arabian unit, which passed the one million customer mark in October last year, just one year after launch. Other operations include Virgin Mobile in South Africa, and FRiENDi in Malaysia and Jordan. In a recent interview with UAE-based publication The National, Mr Vinter noted that the UAE remains a desirable market, commenting: ‘What we need is an MNVO licence, and none have been awarded here yet. We need permission from the regulator and the government to open up for business. The UAE is a market we feel is very interesting, and we monitor it all the time, but I’ve no idea on a timeline of when it might happen.’

CK Hutchison, the owner of Three UK, is said to have inked network capacity deals worth a total GBP3 billion (USD4.2 billion) with pay-TV duo Sky and Virgin Media, as it seeks to gain approval for its GBP10.25 billion acquisition of larger rival O2 UK. According to the Daily Telegraph, the deals have been designed to help persuade regulators that competition in the UK mobile sector will be preserved in the wake of proposed merger. Sky has reportedly signed up to take a 20% share of the combined Three-O2 network capacity for more than a decade – if the takeover goes through; the deal is valued at GBP2 billion. Sky, which already has a wholesale deal in place with O2, is expected to unveil an MVNO by year-end, regardless. Virgin has tentatively agreed to take a further 10% of the network capacity, but may opt to remain on the EE network if its existing partner improves its own terms. As previously revealed, Hutchison has also committed to selling O2’s 50% stake in Tesco Mobile to the supermarket giant. European officials now have until 15 May to decide whether to allow or block the O2 takeover.

Following the approval of Resolution No. 663 on 21 March 2016, Brazil’s National Telecommunications Agency (Agencia Nacional de Telecomunicacoes, Anatel) has revised certain clauses attached to Articles 24 and 54 of its existing MVNO regulation. The revisions – which concern geographical limitations, technical implementation and pricing – have been designed to stimulate growth within the sector. According to TeleGeography’s GlobalComms Database, MVNOs accounted for just 0.1% of the overall Brazilian mobile market at end-December 2015.

According to Russian business daily Kommersant, Russia’s ‘Big Four’ mobile operators – Mobile TeleSystems (MTS), MegaFon, VimpelCom (Beeline) and Tele2 Russia – have until 25 July this year to improve their respective network availability to MVNOs, or risk legal action. By that date – four years on from the cellcos’ LTE licence awards – all companies must be able to prove that they are offering wholesale access to MVNOs in at least five regions. The newspaper claims that of the 76 MVNOs registered by industry watchdog Roskomnadzor, as many as 32 are held by affiliates of the Big Four, while many more remain inactive.

Following the recent launch of family-friendly MVNO Krew Mobile in the US, Vancouver-based owner Otono Networks has announced that it has changed the name of its Ready SIM service to ZIP SIM. The name change reflects a strategic shift to focus on the product’s main attribute – its patented self-activation process. ZIP SIM customers can simply text any five-digit US ZIP code via their handset, which will instantly activate the SIM, assign a local phone number and start the service plan right away, without visiting a retail store or going online. Otono’s portfolio of mobile services includes Roam Mobility for USA, Roam Mobility for Canada, ZIP SIM, AlwaysOnline Wireless and Krew Mobile.

Also in North America, Scratch Wireless – an MVNO on the Sprint Corp network – is no longer selling its services to new customers as it works on unspecified new products and services. A message on the company website reads: ‘Scratch Wireless continues to support current customers, however, our product is discontinued and unavailable for purchase. We apologise for any inconvenience.’ The MVNO launched in 2013 with a Wi-Fi-first mobile service model.

XIUS, an Indian provider of mobile commerce technology and mobile infrastructure solutions, has teamed up with UK-based Hebitel, a global provider of MVNO management consulting services, to announce their partnership to help companies launch MVNOs in India. The duo intend to offer clients a one-stop-shop for MVNO launches in India. XIUS will provide the technology and integration expertise, while Hebitel will provide services such as licence applications, market identification and business planning as well as experienced interim staff. GV Kumar, CEO of XIUS, commented: ‘With a presence of nearly 25 years, XIUS operates both in Indian and international telecom markets. Our Mobile Services Platform (MSP) manages more than 350 million phone calls a day. Having built our own successful business in India gives us the local knowledge to provide MVNO entrants a real advantage in this complex market.’

Finally, according to the Communications Authority (CA) of Kenya, the country’s sole MVNO, Finserve Africa (Equitel), had signed up a total of 1.407 million customers by the end of 2015, up by an impressive 29.6% quarter-on-quarter. Finserve Africa, a subsidiary of regional bank Equity Group, was awarded one of three MVNO licences by the regulator in April 2014 and launched services the following October.

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Brazil, Canada, India, Jordan, Kenya, Malaysia, Oman, Russia, Saudi Arabia, South Africa, United Arab Emirates, United Kingdom, United States, Communications Authority of Kenya (CA), Federal Service for Comms, IT & Mass Media (Roskomnadzor), Finserve Africa (Equitel), Hebitel, National Telecommunications Agency (Anatel), Otono Networks, Scratch Wireless, Sprint Corporation (became part of T-Mobile US), Virgin Mobile MEA (formerly FRiENDi Group), Xius, ZIP SIM (US)