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

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13 May 2019

After an eight-year review, the Federal Communications Commission (FCC) has denied China Mobile USA’s application to provide telecoms services between the US and foreign destinations, scuppering its hopes of launching an MVNO in the US. In denying the request, the FCC noted: ‘After an extensive review of the record in this proceeding, the Commission finds that due to several factors related to China Mobile USA’s ownership and control by the Chinese government, grant of the application would raise substantial and serious national security and law enforcement risks that cannot be addressed through a mitigation agreement between China Mobile and the federal government.’ As per FCC documentation, China Mobile had intended to offer MVNO services in the US, as well as providing international interexchange services and international private line circuits. TeleGeography notes that in December 2017 China Mobile International (CMI) launched an MVNO in the UK, under the CMLink brand name. According to the CMLink website, the company is also active in Japan and Thailand.

Aerospace giant Airbus has announced that it launched MXLINK – a secure mobile virtual network operator (SMVNO) for Mexican public safety and defence authorities – on 3 May. MXLINK takes advantage of the deployment of the open access Red Compartida 700MHz wholesale network, and also supports interoperability with the existing Tetrapol public safety network and delivers end-to-end voice and data security from a domestic datacentre platform. First deployed in 1999, the nationwide Tetrapol network covers 85% of the population and 50% of the Mexican territory and employs more than 100,000 active terminals.

US cableco Charter Communications added 176,000 mobile lines in the first quarter of 2019, to take its Spectrum Mobile MVNO user base to 310,000 at end-March 2019. The MVNO business generated revenues of USD140 million in 1Q19. Speaking on a conference call with analysts (as quoted by Seeking Alpha), CEO Tom Rutledge noted: ‘We’re currently testing the possibility to broaden the mobile capabilities of our network using a combination of dual SIM technology, with unlicensed and potentially licensed spectrum deployed in home, in business, on strand and across our 51 million [cable] passings.’

Sticking with the US, Altice USA says that it is on target to launch its own MVNO this summer, having already deployed 19,000 small cells, with which it augment its wholesale agreement with Sprint. Altice – which will launch as a Full MVNO – says that its core network infrastructure is ready, and it has major mobile handset partnerships in place.

Switching our focus to Europe, PosteMobile, the MVNO owned by Italian state-owned postal services operator Poste Italiane, increased its mobile user base to 4.2 million at 31 March 2019, up from 3.9 million one year earlier. The MVNO notes that in 1Q19 it sold an average of 3,300 SIM cards a day.

The Telefonica Deutschland online-only sub-brand BASE is being discontinued, the latter has confirmed, with all subscribers set to be migrated to its sister brand Blau. TeleGeography notes that BASE is the former E-Plus brand, that was repositioned from a premium sub-brand to an online-only service in 2016. The BASE brand was originally launched back in August 2005, and as such pre-dates Blau, which was introduced by its original owners in September 2005. Both brands were inherited via Telefonica’s October 2014 takeover of E-Plus. No completion date has been mentioned for the switchover, although the process is understood to be underway.

KPN of the Netherlands shut down the retail stores of its budget mobile/fixed sub-brand Telfort at the start of May, as planned. Furthermore, the Telfort website confirms that the sub-brand no longer offers new subscriptions from 1 May, with new customers directed instead to KPN’s website. Existing Telfort customers may renew their subscriptions or switch to KPN at no charge, and are also offered extra bundling benefits if taking multiple KPN/Telfort fixed/mobile/TV services at the same address under the Telfort Complete banner – e.g. double mobile data, a EUR5 (USD5.62) monthly discount or a free channel package. For the time being, Telfort online/call centre customer support remains in operation, whilst all Telfort user accounts will eventually be transferred to KPN at an as-yet undecided date. Underlining the tough competition faced by KPN/Telfort in the discount multi-play market, rival VodafoneZiggo’s sub-brand Hollandsnieuwe last week launched the offer of a year’s free premium TV package for its mobile customers who also take Ziggo cable services; the offer is open to Hollandsnieuwe consumers on monthly tariffs of EUR7-and-above.

Finally, in a decision dated 24 April 2019, the Belgian Institute for Post and Telecommunications (BIPT) has imposed a EUR394,070 (USD442,569) fine on Lycamobile Belgium due to its non-compliance with a previous decision relating to the identification of pre-paid SIM card users. The watchdog has also applied a new series of mandatory measures on the MVNO, which has 60 days to pay the fine, or register an appeal.

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