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MVNO Monday: MVNOs Europe Special

12 Nov 2018

Speaking at the MVNOs Europe conference in London last week, Chris Tooley, CEO of UK-based MVNO giant Lycamobile Group, reiterated his objections to the European Commission’s (EC’s) ‘Roam Like at Home (RLAH)’ mandate, positioning his company as ‘the naughty boys of roaming’ and referencing the company’s ‘well-publicised spat with *Ofcom*’. Indeed – throwing down the gauntlet to the major MNOs in attendance – Tooley suggested that unless wholesale prices are adjusted to absorb European roaming, 90% of MVNO business models will become unsustainable.

The MNOs themselves remained upbeat about the competitive environment, with Nick Wooten, director of MVNOs at BT later dismissing suggestions that MVNO opportunities are shrinking, while noting: ‘We are having more conversations than ever with potential partners’. On the same panel, Steffen Oefner, Head of Mobile Wholesale Business Models at Deutsche Telekom (DT) agreed, stating: ‘There is no fun for us seeing a partner fail.’

An altogether different predicament was on the agenda when Arkadi Panitch, founder and CEO of Belgian mobile virtual network enabler (MVNE) Effortel, spoke of the challenges of launching MVNOs in Russia. He described Effortel’s ongoing cooperation with Tele2 Russia as an ‘MVNO Factory’ and said that – above all factors – the fact that Russia has 85 different regions (and eleven time zones) is the biggest obstacle to successfully launching an MVNO in the country, which is why MVNO launches are staggered, one region at a time. Indeed, he noted that launching one MVNO is like launching ‘85 different MVNOs’ due to the different regional tariffs prevalent in Russia.

Roaming woes aside, fresh challenges are also on the cards for Lycamobile Group, with Chris Tooley sharing news regarding the firm’s expansion plans in a separate conference session. Intriguingly, Lycamobile’s list of 2019 target markets includes Mexico, India, Russia, Uganda, Cameroon and Kenya. The African launches will be in spite of the limited success Lycamobile has experienced in that continent to date; the executive noted that the ‘ecosystem isn’t right’ for MVNOs to do business in Africa and you can ‘get a toe-hold’ but it is hard to succeed.

In other news, Orange Espana has agreed the takeover of local MVNO Republica Movil, which currently presides over a user base of around 130,000. Going forward, Orange is expected to preserve the Republica Movil brand. The MVNO launched over the Orange network back in 2013.

Sticking with Spain, Vodafone Espana has launched a new discount sub-brand called bit as it seeks to address stiff price competition. The new brand charges EUR25 (USD28.3) per month for unlimited calls and 25GB of data, or EUR50 for the same offer plus fibre-optic connectivity. By comparison, Vodafone Espana’s standard 25GB ‘Tarifa Red L’ deal currently costs EUR41 per month. Customer care is only available through the new unit’s app or website.

Elsewhere in Europe, Norway’s Hudya, which offers mobile services, utilities and insurance, has agreed to acquire fellow Telenor MVNO Telipol, in a transaction which will take effect on 1 December 2018.

In South Africa, FNB Connect customers are set to benefit from Cell C’s roaming agreement with MTN South Africa by the end of the year, reports. In May, Cell C announced it had ‘entered into a far-reaching roaming agreement’ with MTN to complement its own network. An FNB spokesperson noted: ‘This agreement will significantly increase coverage, specifically 3G and 4G coverage across South Africa, for our FNB Connect SIMs’. The bank added that it currently has over 500,000 active SIMs.

Russian MVNO Tinkoff Mobile, a subsidiary of online banking giant Tinkoff Bank, has extended its services to a number of new locations, including: Kostroma, Samara, Smolensk, Tambov, Tver, Tomsk and the Republic of Mordovia. Tinkoff Mobile was launched in December 2017 as a Full MVNO and operates over the Tele2 Russia network. The MVNO already covers destinations such as Moscow, St. Petersburg and Volgograd.

Finally, Telecom Italia (TIM) sub-brand Kena Mobile, which went live back in March 2017, has signed up one million subscribers. Local site MVNO News says the milestone was reached at the end of October, and notes that the sub-brand benefitted from the addition of 327,000 ported numbers in 9M18. As previously reported by MVNO Monday, the reseller reached the 500,000-subscriber mark in June this year. Kena is technically a subsidiary of Noverca, the mobile virtual network aggregator (MVNA) that has been wholly owned by TIM since October 2016.

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