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

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13 Jun 2022

UK-based MVNO group Truphone, which is owned by Russian oligarch Roman Abramovich and his associates, is being sold for just GBP1 (USD1.25), the Financial Times reports. As per the article, Truphone has appointed restructuring specialist FRP Advisory to conduct a sale of the company after sanctions imposed on the Russian billionaire by UK authorities cast doubts over the company’s ability to remain operational. Despite recording 15 consecutive years’ worth of losses, Truphone was valued at as much as GBP410 million in 2020 and has received more than GBP300 million in investment from Abramovich and his Russian business partners, Alexander Abramov and Alexander Frolov.

Back on 21 April this year the US Federal Communications Commission (FCC) proposed a USD660,639 fine against the group’s US unit Truphone Inc for ‘exceeding statutorily prescribed foreign ownership limits’ in its FCC-issued licences without FCC approval, and for ‘unauthorised transfers of control’. While Truphone is an MVNO, FCC documentation notes that it indirectly holds a PCS licence in Butte, Montana, via iSmart Mobile, which is a subsidiary of SmartCall. Because the company is in possession of a common carrier radio licence, the watchdog has been able to hit it with a substantial fine. The FCC explained: ‘It appears that Truphone’s failure to report truthful and accurate ownership information was egregious. As a result of Truphone’s failure, control of a US common carrier passed to an unvetted foreign entity and associated individuals for more than seven years.’ Control of the company has changed multiple times, often being transferred between Abramovich-linked holding companies in Cyprus and the British Virgin Islands.

Singapore-based MVNO Gorilla Networks has been acquired by Society Pass Incorporated (SoPa), a data-driven loyalty and e-commerce platform based in Vietnam. With international borders reopening as the world emerges from COVID-19 related lockdowns, Gorilla expects to market its services to the region’s travellers, and plans to expand its MVNO business to Vietnam, Thailand and Malaysia over the next twelve months.

US MVNO Reach Mobile has secured an additional USD8 million in funding, bringing its two-quarter fundraise to USD16 million, for a total of USD35.6 million in funding to date. The company also announced the launch of ReachNEXT, a Software-as-a-Service (SaaS) platform that ‘accelerates and streamlines how companies bring network-based services to market’. Reach pitches the platform as a one-stop-shop for companies considering launching an MVNO, a fixed wireless access (FWA) service or an IoT proposition. Reach Mobile CEO Harjot Saluja commented: ‘Demand for turnkey mobile and fixed wireless offerings is skyrocketing, particularly among ISPs. The platform provides a clear path to market for innovative offers that have previously taken years and millions to build.’

In a related development, US cableco WideOpenWest (WOW!) has partnered with the aforementioned Reach Mobile to soft-launch its new MVNO offering in Montgomery, Alabama. WOW! says that its mobile service leverages ‘the nation’s largest 5G network’, suggesting it piggybacks on the T-Mobile US network.

Plintron Holdings and Plintron Mobility Solutions, subsidiaries of Singapore-based mobile virtual network aggregator (MVNA) Plintron, have secured a favourable award in an arbitration procedure initiated by Brazilian mobile virtual network enabler (MVNE) Surf Telecom, under the Commercial Arbitration Rules of the American Arbitration Association. The sole arbitrator rejected all claims brought by Surf Telecom arising from a Master Services Agreement (MSA) entered into with Plintron in 2017 and found that Surf Telecom breached the parties’ MSA, awarding damages caused by Surf Telecom’s breaches.

Finally, UK-based MVNE x-Mobility has announced that it has supplied its one millionth UK mobile number. The millionth UK mobile number is being used by a customer of AppVNO provider, Vyke. x-Mobility says that it is on track to reach the milestone of two million UK mobile numbers activated within the next 18 to 24 months. All the numbers x-Mobility provides are powered by Three UK and are fully portable in and out via x-Mobility’s MNP partner, Syniverse.

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