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Mobile Virtual Network Operator (MVNO)

Mobile Virtual Network Operator (MVNO) is a GSM phenomenon where an operator or company which does not own a licenced sprectrum and generally with out own networking infrastructure. Instead MVNOs resell wireless services under their brand name,  using   regular telecom operator's network with which they have a business arrangements. Usually they they buy minutes of  use from the licenced telecom operator and then resell minutes of usage to their customers of MVNO. Currently MVNOs are  emerging in fast pace in European markets and beginning in USA also. Slowly MVNO phenomenon catching up in Asia and other  parts of the world also.

An example for MVNO is Virgin Mobile. Virgin Mobile plc is a mobile phone service provider operating in the UK, Australia and Canada, and the US. The company was the world's first Mobile Virtual Network Operator, launched in the UK in 1999. It does  not maintain its own network, and instead has contracts to use the existing network(s) of other providers. In the UK, Virgin  Mobile uses the T-Mobile network. In the US, the Sprint network is the carrier. In Australia, Virgin Mobile operates on the  Optus network. In Canada, it uses the Bell Mobility network. These networks use different technology (GSM in the UK and  Australia and CDMA in the US and Canada).

Usually MVNO's do not have their own infrastructure, some providers are actually deploying their own Mobile Switching Centers (MSC) and even Service Control Points (SCP) in some cases. Some MVNO's deploy their own mobile Intelligent Network (IN) infrastructure in order to facilitate the means to offer value-added services. In this way, MNVO's can treat incumbent infrastructure such as radio equipment as a commodity, while the MVNO offers its own advanced and differentiated services based on exploitation of their own IN infrastructure. The goal of offering value-added services is to differentiate versus the incumbent mobile operator, allowing for customer acquisition and preventing the MVNO from needing to compete on the basis of price alone.

MVNO's have full control over the SIM card, branding, marketing, billing, and customer care operations. While sometimes offering operational support systems (OSS) and business support systems (BSS) to support the MVNO, the incumbent mobile operators most keep their own OSS/BSS processes and procedures separate and distinct from those of the MVNO.

 

Characteristics of an MVNO:

  • MVNOs are new breed of wireless network operators who may not own the wireless spectrum, or wireless infrastructure (also termed pipe, in colloquial terms) but give a virtual appearance of owning a wireless network. These operators lease the pipe or wireless capacity from traditional operators and then repackage it for a specific vertical industry application.

  • Main added value that MVNO provides is billing and customer care functions. In that sense MVNOs own the customers.

  • MVNOs generally provide both voice and data services to end users through a paid up subscription agreement.

  • To become an MVNO, one should cobble together a partnership 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.


MVNO Services

For now MVNO services have been limited, but analysts from EMC Research have predicted that as wireless services grow, so will the availability of niche MVNO applications. For instance, in the future a cell phone user may be able to subscribe to a network operator plus multiple MVNOs for specific data services over the same phone. One MVNO could provide sports news, another weather and traffic and still another could provide instant messaging capabilities.

MVNO's might also offer voluntary MVPN services based on the IPSec or Mobile IP VPN client to their customers, which allows to terminate the IPSec connection at a VPN gateway or HA in the MVNO data center and also supporting multiple access technologies.

In this way, each MVNO and the network operator could focus on their own niche markets and form customized detailed services that would expand their customer reach and brand.

Regulation

So far MVNOs have not been regulated in any country. The ITU has received several requests to study the issue, specifically to provide input on whether government intervention is necessary to allow MVNOs to offer services and applications at a lower price to consumers. This would help to ensure a more efficient use of the spectrum but some incumbent providers argue that the market is already competitive and intervention is not necessary.



MVNO Resources :

Wikipedia - MVNO

MVNO Analysis

Virgin Mobile

MVNO Tutorial

2006 MVNO Summit

How to launch MVNO - Whitepaper