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

21 May 2018

UK/US MVNO The People’s Operator (TPO), whose backers include Wikipedia founder Jimmy Wales, intends to offload its struggling US unit and concentrate its focus on the British business. In a trading update published on 15 May, TPO noted: ‘The board has reviewed the relative positions of the UK and US entities and has concluded that the company should concentrate its effort on the UK market, which enjoys the larger number of subscribers, has been allocated the larger marketing budget and offers better growth prospects in the short and medium term … The board is negotiating final terms with a third party to migrate its US customer base to the purchaser’s platform. Shareholders and investors should note that no definitive documents have been signed at this stage and there is no guarantee that the deal will complete … Although the company will retain its licence to operate in the US, the remainder of the US operation, including the small office in New York, the outsourced customer service operation and the outsourced legal and compliance functions will be closed.’ Barclays, which is said to be the sole secured creditor, is owed GBP1.02 million (USD1.37 million), the MVNO added.

Virgin Mobile Latin America (VMLA) has dismissed reports suggesting that it has enlisted investment bank BTG Pactual to sell its operations in Colombia, Chile and Mexico. Peter Macnee, CEO of VMLA, commented: ‘While we are flattered by the attention received in the press, our goal remains to build the most successful mobile service in the region, focusing on the needs of each client. We are incredibly proud of the energy that each of our teams has invested in building successful businesses in Chile, Colombia and Mexico, and we look forward to the continued growth of our great company.’

Swiss-owned, Netherlands-registered MVNO firm Lebara Mobile Group closed out December 2017 with 2.9 million subscribers, parent VIEO has revealed in its most recent financial report. The company notes that the main drivers of this reduction relate to seasonality, the impact of German registration requirements and ‘specific and targeted marketing actions taken by management to improve long-term profitability by focusing on attracting higher quality customers’. As such the MVNO’s German user base slumped by 88,000 year-on-year, while the Spanish unit weathered net subscriber losses of 57,000 in 2017. Denmark provided a bright spot, however, adding 15,000 net users during the year under review. At EUR15.6 (USD18.4) per month, Lebara France continues to generate the highest ARPU.

Spanish MVNO Digi Mobil, which targets the country’s Romanian diaspora, has reached the one million subscriber mark, parent company Digi Communications has reported. The figure was revealed in the Bucharest-based group’s 1Q18 report, and represents an increase from 635,000 y-o-y. The Italian Digi Mobil unit grew its user base to 195,000 at the end of the first quarter, while the group’s Hungarian MVNO user base dipped to just 11,000 at end-March.

Australia has a new MVNO in the form of Lyf Mobile, which seeks to target Millennials. Founder Todd Scott commented: ‘We developed this MVNO so young Aussies who are time poor or on a budget can easily stay connected and not break their banks. It’s a company run by Millennials, for Millennials, where we listen to our customers’ needs and thoughts on a range of community issues. Lyf Mobile is stepping away from standard telco offerings to be a little bit different and offer a little bit more than just a great phone connection and we are thrilled to launch this across the nation.’ The new virtual operator piggybacks on the Telstra network.

Over in Russia, Sberbank-Telecom, a subsidiary of Russian banking and financial services firm Sberbank, has reportedly launched in Moscow under the Pogorovim (‘Let’s Talk’) brand. The launch had been expected to take place on 1 February; no reason has been given for the delay.

Finally, Telecom Liechtenstein (trading as FL1) has launched mobile services in for business users in Switzerland, via a wholesale agreement with Sunrise. FL1 has been active within the Swiss market since 2015, using its independent infrastructure to deliver wireline, broadband and IoT to corporate clients. Mathias Maierhofer, Chairman of the Executive Board, noted: ‘For the first time, our Swiss business customers have the opportunity to get everything from one source from FL1.’

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