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

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2 Nov 2020

Private equity firm GTCR has signed a definitive agreement to acquire Consumer Cellular, one of the largest independent MVNOs in the US. Headquartered in Portland, Oregon, Consumer Cellular provides post-paid wireless services to the over-50s demographic. The company currently serves approximately four million subscribers nationwide, while the deal is expected to close in the fourth quarter of 2020. While the specifics of the transaction have not been disclosed, Light Reading – citing sources familiar with the matter – claims that the final deal was valued at USD2.3 billion. Intriguingly, the site asserts that GTCR secured the deal after a taking part in a bidding war that included the likes of DISH Network, British investor Cinven and a consortium spearheaded by Boost Mobile founder Peter Adderton and backed by Marlin Equity. Cablecos Comcast and Altice USA also monitored the sale process.

Comcast Corporation has reported that its Xfinity Mobile MVNO ended 30 September 2020 with 2.580 million subscribers, up from 1.791 million one year earlier. Quarterly wireless revenues reached USD400 million, up 22.8% from USD326 million one year earlier.

Sticking with the US cable sector, Charter Communications (Spectrum) added 363,000 mobile lines in the third quarter, taking its subscriber total to 2.060 million as of 30 September 2020. Quarterly mobile revenues surged 91.8% from USD182 million in 3Q19 to USD368 million in 3Q20.

In addition, Altice USA-backed Altice Mobile has signed up more than 162,000 mobile lines since its commercial MVNO launch in September 2019, equivalent to net adds of 18,000 in Q3 2020. The MVNO generated revenue of USD19.7 million for the quarter.

Over in Australia, Optus has unveiled plans to ‘disrupt and reinforce its presence in Australia’s MVNO market’ via the takeover of Australia’s largest MVNO, amaysim and the parallel launch of a new digital brand Gomo. Optus will acquire the shares of amaysim’s mobile holding company and its customer base of approximately 1.19 million subscribers for AUD250 million (USD175.7 million), subject to completion conditions, including amaysim’s shareholder approval, and payment adjustments. Meanwhile, Gomo customers will have a digital interface – the Gomo app – which can be accessed 24/7 for onboarding, service and payments. Optus notes that the new service leverages learnings from parent company Singtel’s successful Gomo apps in Singapore, the Philippines, Indonesia and Thailand.

South Korean satellite TV provider/ISP KT SkyLife launched its long-awaited MVNO service on 30 October, via the KT Corp network. KT SkyLife CEO Kim Chul-soo commented: ‘With the release of SkyLife Mobile, we have solved the final [piece of the] puzzle … in addition to [our] existing satellite broadcasting and internet [services]. The company will be reborn as a cost-effective wired and wireless service provider.’

In Japan meanwhile, KDDI has launched a new sub-brand, KDDI Digital Life, as it seeks to complement its primary au brand. The new unit will be a low-cost, online-only provider, that will aim to sign up subscribers using eSIM technology. In other news, KDDI has inked what it describes as a ‘comprehensive partnership’ with Singapore-based MVNO group Circles.Life, suggesting a new MVNO venture may be on the cards. Abhishek Gupta, co-founder and director of Circles.Life, commented: ‘We are grateful for this opportunity to realise our customer-first vision in Japan as well.’

Norwegian ‘smart payments’ specialist Vipps has launched an MVNO over the Telenor Norge network. Local news site Tek.no quotes Elisabeth Haug, Head of Vipps Mobile, as saying: ‘Through user testing and insight work, we see that very many people perceive their mobile subscription as difficult and confusing. Therefore, we thought that here was a good opportunity to use our simplification experience in new areas and solve a new tangle with Vipps Mobile and our mobile app!’

Brazil has a new MVNO in the form of Santa Cruz do Sul-based B2B player Contel. The newcomer will utilise the TIM Brasil network. Interestingly, Contel seeks to tap into a wider potential user base by opting not to exclude people who have a poor credit rating with the Credit Service Protection (Servico de Protecao ao Credito, SPC).

Mobile Vikings Belgium has reached the 300,000-subscriber milestone, the company has informed local site Data News. When factoring in customers using sister company JIM Mobile, the total figure reaches 334,000, the report adds. Mobile Vikings launched back in 1Q09, initially over the BASE network, but switched to Orange in April 2019.

Spanish financial institution Caja Rural de Navarra has acquired a 10% stake in Grupo MASMOVIL’s Basque-focused sub-brand Guuk for EUR3.2 million (USD3.7 million). MASMOVIL’s stake has been reduced from 70% to 64%, while co-founder Dominion has seen its stake fall from 30% to 26%. According to Expansion, a fourth, unnamed investor is set to come onboard in the near future.

Ill-fated Russian MVNO DANYCOM filed for bankruptcy on 29 October. After a series of defaulted bond payments, Krasnodar-based holding company Dani Call opted to file a bankruptcy petition with the Russian Arbitration Court. The financial strife follows DANYCOM’s well-documented issues with host network Tele2 Russia and would-be merger partner MCN Telecom.

The Branch Association of Bulgarian Telecommunications Operators (BABTO) has confirmed that it supports proposals to amend the Electronic Communications Act in a way that paves the way for the introduction of MVNOs. Streaming provider Neterra – which targets Bulgarians abroad – has stated its intention to become the country’s first virtual operator. A process of transposing the European Electronic Communications Code into Bulgarian legislation is currently underway.

MTN South Africa has opened its networks for MVNOs, in a move which will see it go head-to-head with Cell C, the company that supports the bulk of the country’s virtual operators. Tech Central quotes Quintus de Beer, acting executive for managed network services, as saying: ‘With its extensive national network that covers rural areas, MTN offers MVNO partners a high-quality network experience and opportunity to deliver innovative solutions that reach even more South Africans. We expect MVNO subscribers across the country to double over the next five years, with several large players introducing offerings.’

Finally, US-based Telrite Holdings has announced that its H2O Wireless and Pure Talk brands will begin supporting eSIM functionality in Q1 2021. Telrite explains: ‘eSIM streamlines the onboarding process for consumers and wireless providers by eliminating the physical SIM card, allowing new customers to switch immediately without waiting for a SIM card to ship. Retailers also benefit by not having to keep physical SIM inventory in stores.’

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