MVNOs: Benefits, Challenges, and How to Overcome Them

4 minute read

Mobile Virtual Network Operators (MVNOs) are proliferating in the telecommunications service provider market by utilising existing wireless network infrastructure. By buying network capacity from Mobile Network Operators (MNOs), MVNOs have been able to swiftly rise in the market through a business model that passes these savings down to the consumer.

However, competition has picked up immensely in the MVNO market, which has created the need for greater differentiation in order to remain competitive. 

Lower Cost, Differentiated Service for the Consumer

From the consumer side, MVNOs can provide more competitive offerings, which means lower costs without compromising on service. Utilising network capacity without having to own it frees up costs that are then passed down to the consumer.

MVNOs can also offer a more tailored-made service versus MNOs, which tend to offer more of a generic service that suits the masses. Through segmenting the market, offerings can be tailored for different consumer needs, such as offering better international rates for frequent out-of-country callers, for example. This allows MVNOs to take on true unique value propositions to differentiate themselves from competitors.

MVNOs also typically tend to provide a better customer experience since it is focused primarily on providing a service rather than maintaining networks.

Challenges in the MVNO space

While the benefits of MVNOs are clear, the path to a successful launch isn’t always. MVNO start-ups can see initial success, but managing the complexity of the technology, while remaining competitive and scaling wisely – all while remaining profitable – can sometimes create too many challenges to overcome.

One crucial element in an MVNO being successful is the ability to be agile and adaptable. As the mobile market and opportunities change, so needs the MVNO. Take the MNO market, which has been sluggish in adapting its business model which has had direct impact on MVNOs capitalising on the market left open by MNOs. Thinking future-forward, MVNOs need to give serious consideration to agility.

Competition also has watered down the ability to sell MVNO service based on price alone. MNOs have responded to MVNO competition by shifting offerings to provide low-cost options, so MVNOs need to shift, as well, from focusing solely on the cost benefits to the consumer, but to also focus on value-added services.

Mobile Virtual Network Enablement for Best Success

One of the wisest steps MVNOs can take when entering the market is to partner with a Mobile Virtual Network Enablement (MVNE) provider that has the experience in regulatory compliance on both a global and local level. An MVNE provides the MVNO multi-tenancy, scalability, security, transparency, operational efficiency, low operating costs, and carrier capability without lock-in. More importantly, the MVNO can focus on building their own propositions and tailor-made connectivity services by creating their own rate plans and roaming footprint.

KORE MVNE helps MVNO differentiate

As mentioned before, value-added service, as well as flexibility and agility in an ever-evolving market are what will separate MVNOs as competition becomes saturated. KORE MVNE services offer a wide range of value adds to support the overall customer experience, including SMS content, voicemail, and real-time charging.

Additionally, KORE provides a low-cost opportunity to deliver services built and hosted on our network-independent, multi-tenant MVNE platform. We offer a network that provides stability, scalability, redundancy and control, as well as management and monitoring the entire operation of provided services 24/7.

In a recent case study with Simpel, you can read more on the KORE complete MVNE service, including Mobile Network Access, Core Network, Order Flow, Self Service Capabilities, Billing & Customer Service. This allowed Simpel to focus on their customers, without compromising the strong wireless offering that it planned to deliver. 

Want to learn how to launch an MVNO with minimum upfront investment with KORE? Read more in this datasheet.

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