project on mvno

8/6/2019 Project on MVNO

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Project onMobile Virtual Network Operator

Submitted to Submitted by

Ms. Parul sinha Ram kumar Raikwar

Assistant Professor-IT PG20095248

IILM Gurgaon PGP 09-11


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M il i t l t t (M )-Abst t

Mobile virtual network operator do not come from the telecom sector

but they rent the network of mobile operators to become fully mobileoperators on their own. So they compete directly not only with the

other mobile operators but also with their hosting mobile operator.

Hosting MVNOs, supporting them from both operational and

commercial perspectives are new challenges for the mobile

operators: they have to set up a specific internal organization

because they used to be a vertically integrated industrial structure.

All of this represents tremendous changes for them.

The aim of the thesis is

to research and analyze the current status of the MVNO industry,

present different views on implementation approaches, identify

markets and market segments served, note weaknesses and strong

points, refer to successes and failures, research current legislation(s)/

regulatory aspects (that are an essential driver for the liberalization

of network economies) and in general show the industrys evolution

path over time.

The key element is to see if the MVNO is able to increase

the efficiency and competitiveness of mobile markets in specific.

Additionally, starting from the Western European market, an effort

will be made to specifically analyze the case in the Greek MVNO

market by providing some specific data such as type of service

(prepaid/post-paid), airtime replenishment volumes (prepaid case),

brand awareness, market segments, penetration/ adoption rates, etc).

Having gone through the MVNO insights at the end, a description of

all the steps involved for an entity/ business, in becoming an MVNO

from scratch (in the form of a generic guide) will be prepared. A step-

by-step approach will be used for implementing a Mobile Virtual Network Operator (MVNO), stating actions to be adopted and

mistakes to be avoided. Given that most of the current

implementations have followed different/ diversified paths (depending

on the market needs to be served each time as well as the intended

capital investment by the MVNO candidates), an effort will be made

to come up with guidelines (hopefully the most suitable ones, having


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learned from former/recent MVNO adoptions) for aiding such future

implementations. Another important aspect is the modelling of a

mobile network: the MVNOs will use some components while other

components are un-useful for them. Without such model, it is

impossible to derive the right costs and price to be charged to the MVNO in order to have a win-win industrial model for both the

MVNO and its hosting operator.

The M bile vi t l net operators

There is a lot of definitions for MVNOs in the sector but a sounddefinition of virtual operators would consist in saying they are actors

not totally integrated who lack at least a part of the asset at the basis

of the network. Applied to mobiles, this means they do not own the

radio access.

However they supply to the market a complete mobile service and

they own partially or totally their customers.

They rent at least the radio access to their hosting operator but

nothing prevents them to rent more than that to the operator as someelements of the service provided to the end user (billing, contact

center). They also complete the radio access by their own assets like a

transport network or some switching infrastructure.

However MVNO today are most of the time simple resellers of mobile

services that the hosting operator operates technically.

Scarcity of spectrum has allowed only 3 to 5 mobile operators with a

full infrastructure per country via a licensing process. However it

appeared quickly this number was insufficient to have a fully efficient

(and competitive) market despite the existence of 3 to 5 competing

networks.

National Regulatory Authorities (NRA) has seen MVNO as a (too)

quick remedy at least for the access mobile market. This new kind of

actors was deemed to bring more competition (which is not an

objective in itself) that would boost innovation and economic welfare.


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The Beginning of Mobile Virt al Net ork Operators

It all started in 2000 in Denmark with what was then a small start-up

called Telmore. Using the mobile network of the former state operator

TDC, Telmore launched an MVNO business solely online. Customersbought SIM cards only (solely on-line), using phones they already

owned. They prepaid a single per-minute rate regardless of what time

of day they made a call or whether they called a mobile or fixed line.

"In the beginning, it went slowly, but gradually it increased mainly by

word of mouth. Within three years, Telmore had attracted 10 percent

of the mobile market. Perhaps more importantly, within a 10-month

span, the price of a prepaid minute in Denmark had dropped by 50

percent.

MVNOs though will only really have an impact if the incumbents losetheir nerve on price and try to follow them down. If they can hold

their nerve and not panic and accept some leakage, the market can

accommodate a few extra niche players.

Along those lines, however pioneering, this first online SIM-based

concept was a niche concept and targeted only a small share of the

market.

This first MVNO model however has paved the way for others to

follow.


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Characteristics of an MVNO

(1) MVNOs are new breed of wireless network operators whomay not own the wireless spectrum, or wireless infrastructure

but give a virtual appearance of owning a wireless network.

These operators lease the wireless capacity from traditional

operators and then repackage it for a specific vertical

industry application

(2) Main added value that MVNO provides is billing andcustomer care functions. In that sense MVNOs own the

customers.

(3) MVNOs generally provide both voice and data services toend users through a paid up subscription agreement.

(4) To become an MVNO, one should cobble together apartnership that consists of a connectivity of a regular Telco,

a customer base, and a sales channel. Most important, they

need unique and compelling data services

(5)

An MVNO usually provides: Brand, Marketing, Portal,Rights management, billing platform, Customer base


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At picalMVNO BusinessModel

At its most basic level, an MVNO is a standalone entity. It buys access from a

host carrieroften per-minute or per-megabyteand resells it under its own

brand and marketing. MVNOs typically have a strategic intent focused on a

recognized brand, with existing points of distribution and an already installed

base of customers. That doesn't mean upstarts wanting to become MVNOs can't

succeed, as evidenced by Virgin or Boostneither of which were pre-existing

brands in the mobile space at their inception. Succe ss for those companiesdepended on delivering high-quality service, rather than just a brand. The term

MVNO' has become a catch-all for any consumer reseller, so there can be seen

a variety of business models. But a classic MVNO minimizes capEx and keeps

expenses as success-based as possible. That means leveraging outsourcing

solutions for billing, customer care and content delivery. Considering the

typical retail and network elements involved in an MVNO, there is a range of

MVNO classifications/ types between Service Providers (SP) and full MNOs.

Different functions can be carried out by the MVNO or MNO. Some may be

carried out by a Mobile Virtual Network Operator Enabler (MVNE) which may

simplify the MVNO provisioning for either the MVNO or the MNO. MVNEs

develop systems and processes to help facilitate MVNOs, such as handset

distribution, channel management or billing.


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MVNO Defined From a Customer Perspective

To Fully understand the MVNO, and moreover Next Generation

MVNOs, we have to look outside the legacy network led definitions of

an MVNO, as an MVNO is a customer driven, and therefore businessdriven business model. From a customer perspective both the MNO

and the MVNO are their "Network Provider". That is in Greece for

example Frog is seen to its customer as their network provider, not

the host MNO (Cosmote), just as Cosmote is seen as a network

provider

Customer experience

The customers perspective is a simple four-stage process:

Buy -> Use -> Pay -> CareBUYa SIM card, handset, or starter pack

USEfor calling, SMS, or other services

PAYrecharge or other payment method

CAREget advice with questions or problems

There are different ways of handling each stage: from the internet

through to stores, other point of sale, invoices, care centres, the

handset itself.

There are different ways of handling each stage: from the internetthrough to stores, other point of sale, invoices, care centres, the

handset itself


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MVNO opportunitiesincrease with 3G rollout

3G offers MVNOs an exciting opportunity to offer users a rich

multimedia experience. While many of the MVNOs today are offering

low-cost pricing (voice and SMS), 3G will allow them to focusofferings equally on data.

Some of the opportunities identified for potential MVNOs include:

-- Focus on offering convergence

-- Focus on a pan-European offering allowing for low-price calling

While roaming abroad

-- Focus on 3G and in particular data such as mobile music or

Mobile sports

-- Focus an offering for enterprises, whether based on voice or data,

That could potentially be broadened to include roaming as well

For any new MVNO, it is important to focus on niche markets and get

to market sooner rather than later. This will certainly provide the

company with a competitive advantage and allow it to build its brand

and raise awareness in the marketplace.

So the market for MVNOs

opens up the space for established and new players such as billing

and customer care companies to sell into. Billing and customer care

is just one opportunity, and there are also opportunities for ITcompanies and those that specialize in data. This in turn will allow

MVNOs to personalize their data offerings, which can increase usage

and reduce churn.

The insight Opportunities for MVNOs in Western

Europe, analyzes developments in some key Western European

countries and major companies. It also addresses opportunities for

new companies looking to enter this space.


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MVNO GlobalMarket


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The future ofMVNOs

Mobile Virtual Network Enabler is increasingly relieving the pressure

that MVNOs continue to experience as they seek to enter markets

quickly and effectively. Outsourcing the complex business of billing

and customer care for converged services to an MVNE c reates real

flexibility for the MVNO. Indeed the very best MVNEs are those that

have given their MVNO clients the opportunity to fine tune their

service portfolio and be most responsive to changing market

conditions or new technologies.

MVNEs are becoming an integral part of a maturing converged

communications industry. This already includes network providers

and the branded service businesses that have a direct relationship

with a customer. As these proliferate and seek competitive advantage,

the role of the MVNE will grow.

Naturally, there is a rush of businesses positioning themselves as

MVNEs, as well as brands evaluating the MVNO model. The criteria

for success in this MVNE field obviously must include assured

capabilities in running a network service business, however close

collaboration between all players is absolutely essential to success.Specialist skills, experience and systems are of little good unless the

MVNE has worked out how to share risks and responsibilities with its

MVNO client and the other third parties involved. An open

relationship with clean demarcations is critical.

Managed carefully and integrated successfully, quite often requiring

the support of an MVNE, Next-Generation MVNOs have certainly got

the potential to cause even more excitement than they already do.


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VALUE TO MNO & MVNO

-Easy start

- Economies of scale

- Time-to-market

- Innovation & differentiated services

- Field trial with light integration work for MNO

- Risk reduction

VALUE TO MVNO

Operational MVNE Platform and team- Critical mass in expertise & skills

- Agreements with GSM operators- On the shelves technologies and services

Financial advantages

- Mutualisation of investment between MVNOs customers

- Lower upfront and operating costs and investments

Multi-country access

MVNE positioning


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ConclusionsMobil i t l N twork Operator (MVNO) i a GSM phenomenon

where an operator or company which does not own a licensed

spectrum and generally without own networking infrastructure.Instead MVNOs resell wireless services under their brand name,

using regular telecom operators network with which they have abusiness arrangement s. Usually they buy minutes of use from the

licensed telecom operator and then resell minutes of usage to theircustomers ofMVNO. In this paper, we have studied aboutMVNO, its

t ypes, concept s, network architectures, how it use GSM networks,

feature, strategies, business models. We have a greatopportunity forestablishing a MVNO networkin our country. This willbe profitable

for MVNO operators, MNOs andthe subscribers as well,,,,


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project on mvno

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