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MVNO

The term MVNO stands for ‘mobile virtual network operator’. The ‘virtual’ part of the term is crucial to defining what an MVNO actually is.

As a virtual operator the MVNO typically does not own base stations (mobile phone towers) or the technology and systems which link these from the subscriber using their handset to the completion of their request (such as calling or texting).

Further to this, MVNOs do not typically own licensed spectrum frequency either. This is accessed via their partner MNO which will have purchased this from a telecommunications regulator or government department in most cases.

You will have noted the use of ‘typically’ in referring to what an MVNO may or may not possess. The widespread belief is that MVNOs simply exist as companies which use MNOs’ technology to provide a mobile phone service. However, in many cases MVNOs will have in place their own OSS, BSS and back office solutions, and may in fact have physical hardware in place too, such as switches. The MVNO News recently noted a telco vendor offering MVNOs the technical ability to build out their own base stations in areas where their host MNO has reduced coverage. Licensing of MVNOs also takes place and varies in format from country to country; for some an actual MVNO license is required.

A further incorrect assumption is that MVNOs are only consumer focused and only provide tradition voice and text services. An MVNO can exist to target any demographic which uses a wireless service to perform its goal. For this reason M2M MVNOs exist - such instances include telematics and mobile health. Amazon operates a wireless eBook service; the company retails their own device which provides users the ability to read books electronically on the go.

MVNOs also provide services beyond just voice and SMS. Many virtual operators offer MMS, international roaming, mobile Internet, mobile content applications and any added functionality which their host network will agree to provide access to or allow as part of the relationship.

In defining what an MVNO is the Blycroft Publishing definition takes account of the client relationship. Where a company sells a mobile service and maintains the ongoing relationship with the subscriber then this is essentially what an MVNO does. The MVNO seeks out a target market (often a niche market), wins subscribers onto its order book, bills them for using the service, conducts marketing activity to them and from the subscribers’ point of view, provides them with the mobile service. This means that resellers can be included in the description of MVNOs but from the customer’s point of view that reseller is their mobile phone network. 

This definition does not include resellers who win a commission for signing up customers for an MNO or MVNO and then hands the client management / relationship over to the supplier.

Subpages (3): Failed New Markets Retailers
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