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

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14 Aug 2017

UK mobile operator Three UK is set to launch a new budget-priced sub-brand in the form of SMARTY. The new operator’s unique selling point is its willingness to give discounts to customers who do not use up their full monthly data allowance. The SMARTY website states: ‘We keep GBP5 (USD6.5) to cover the costs of running the network (plus the unlimited calls and texts bit) and give you a discount based on the data you didn’t use. We calculate remaining MBs, not GBs, meaning the discount you get is exactly what’s due. We don’t do rounding.’ While Three UK has not formally announced the development, the small print in the new operator’s privacy policy lists Maidenhead-based Hutchison 3G UK Limited as the company’s owner. The Financial Times, citing a source briefed on the new brand, has claimed that SMARTY will initially only be open to a limited number of users.

South African mobile operator Cell C has formally unveiled its partnership with global MVNO giant Lycamobile Group. Lycamobile South Africa – the UK group’s 23rd unit – is only the second Lycamobile subsidiary in Africa, after Lycamobile Tunisia. Lyca Group chairman Allirajah Subaskaran commented: ‘We are very excited to be partnering with Cell C to launch our offering to this compelling market. As one of the most influential and technologically advanced countries in the region, South Africa is a natural choice for Lycamobile, as we continue to expand further into the thriving African telecommunications space’.

Romanian cableco Digital Cable Systems (AKTA) is set to launch an MVNO on 15 August, some two years after first disclosing its ambitions to enter the virtual sector. The AKTA MVNO will go live over the Telekom Romania Mobile network; Telekom also hosts Lycamobile Romania, the country’s first virtual operator (launched in March 2015).

ManagePay Systems (MPay) has entered into a joint venture (JV) agreement with Contracts Rise to acquire an MVNO licence from the Malaysian Communication and Multimedia Commission (MCMC). According to local press reports, citing a filing with the Bursa Malaysia, MPay will hold a 40% stake in the JV, while Contract Rise will hold the remaining 60%. The MVNO seeks to offer MPay’s e-wallet services to around 200,000 subscribers.

Slovakian MVNO DH Telecom, part of the Digital House Group, which has operated over the Slovak Telekom network since 2013, is said to be on the verge of bankruptcy. Unverified local press reports have suggested that the MVNO made a loss of EUR3.4 million (USD4 million) in 2016. If the reports prove accurate, it puts a big dent in the already small Slovakian virtual market. Aside from Tesco Mobile Slovakia – a JV between O2 Slovakia and Tesco Slovakia, reseller activity is restricted to Slovak Telekom sub-brand Juro and Orange Slovakia sub-brand FunFon.

Self-styled freemium operator FreedomPop Espana has reportedly switched network providers, terminating its agreement with Movistar in favour of a new wholesale deal with Grupo MASMOVIL. According to local technology site, the new arrangement will allow the virtual operator to belatedly introduce 4G LTE access to its subscribers. The US-owned MVNO celebrated its one year anniversary last month, claiming a total user base of 100,000.

US MVNO Ting has reportedly added 19,000 subscribers in the first half of 2017, to grow its user base to 170,000 accounts (and 278,000 devices) at 30 June 2017. Fierce Wireless, quoting a Seeking Alpha transcript of a conference call held by Ting owner Tucows, quotes CEO Elliott Noss as saying: ‘We continue to work through the impact of the large base of customers that migrated from [now defunct MVNO] RingPlus in Q1.’ He also noted that the second quarter of 2017 also saw the lowest monthly churn from Ting’s core base in two years.

The Bangladesh Telecommunication Regulatory Commission (BTRC) has confirmed that it is in the process of conducting a feasibility study into the introduction of MVNOs. BTRC chairman Dr Shahjahan Mahmood told the BSS state news agency: ‘If we find that the MVNO would bring benefits for the people, we must go for it through formulating a guideline.’

Finally, over in Indonesia, XL Axiata has bemoaned the absence of a suitable regulatory framework governing the introduction of MVNOs in the country. CEO Dian Siswarini told IndoTelko that while there are no technical restrictions – the operator’s network utilisation currently stands at around 50% – would-be MVNOs lack regulatory support. The chief executive claimed that the cellco had received ‘many offers’ from interested parties.

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Bangladesh, Indonesia, Malaysia, Romania, Slovakia, South Africa, Spain, United Kingdom, United States, Bangladesh Telecommunication Regulatory Commission (BTRC), Cell C, DH Telekom (Digital House Group), Digital Cable Systems (AKTA / Dial), FreedomPop Espana, Hutchison 3G UK (Three UK), Lycamobile South Africa, Malaysian Communications and Multimedia Commission, ManagePay Systems (MPay), SMARTY, Ting Mobile, XL Axiata