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Mobile virtual network operator

Wireless telecom service reseller

  • 10 min read
  • 5 chapters

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Through Customer relationship management and India

Several MVNO brands have a presence in multiple countries, either as subsidiaries, joint ventures, or through brand licensing agreements with local entity partners.

History

MVNO agreements with network operators date back to the 1990s, when the European and Australian telecom markets saw market liberalization, new regulatory frameworks, better 2G network technology, and a subsequent jump in wireless subscriber numbers. Though the new 2G networks more efficiently managed the limited frequency bands allocated to wireless service, new mobile entrants were still limited by their ability to access frequency bands in a restricted spectrum.

With European markets newly open to competition and new technology enabling better service and cheaper handsets, there was a massive surge in demand for cellular phones. In the midst of this swell, Sense Communications fought for access to MNO spectrum in Scandinavia in 1997. Sense was able to establish an MVNO agreement with Sonera in Finland, but it failed to persuade MNOs in Sweden, Denmark, and Norway. Sense then appealed to EU regulators, citing provisions that required certain MNOs to allow new entrants interconnection. While Sense's claim was denied, in November 1999, the company signed a service provider agreement with Telia/Telenor Mobile for GSM network capacity access, allowing Sense to offer services to its own customers in Sweden and Norway.

Despite Sense's initial failure, the regulator in Denmark saw the promise in the MVNO model as a cost-effective route for telecom companies to enter the market and in May 2000, legislation passed that required network operators with significant market power to open up access to their infrastructure. By August of that same year, the MNO Sonofon had solidified the first viable MVNO agreement with Tele2. This agreement provided Tele2 with access to Sonofon's network for both mobile and roaming services, the latter of which had been requested by (and denied to) Sense Communications. With the new regulations in place, MVNOs in Scandinavia eventually grew to a market share of above 10%.

By 2008, US wireless subscribers had a choice between around 40 MVNOs. According to the FCC, approximately 7% of all U.S. mobile subscribers were served by resellers, including MVNOs, and analysts found that the 15.1 million wireless subscribers served by resellers by the end of 2006 had increased by 1.6 million over the previous year.

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