Telecom

Considerations for starting a mobile virtual network operator company

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In a previous article, we discussed what a mobile virtual network operator, or MVNO, is and what their role is in the wider telecommunications ecosystem. We also discussed what sets them apart in the industry and their importance to the consumer.

What we did not discuss is what an enterprising telecoms entrepreneur ought to consider when start their own MVNO.

The trends

MVNOs are a fast-growing trend in today’s telecoms industry. MNOs are increasingly realizing the importance and significance of partnering with MVNOs in reaching out to niche consumer groups with interest in different data plans.

In the most basic terms, MVNOs buy bulk network access from large MNOs and resell them to consumers through their MVNO network under their own brand or in specific packages, such as student plans as an example.

There are four main business models for MVNOs, they are:

  • Branded Reseller
  • Light-MVNO
  • Full-MVNO
  • MVNE

So, what does one have to consider before starting a mobile virtual network operator business? There are numerous paths to take, and many factors to consider.

It is important to consider the size of the MVNO you wish to open when determining costs. Having a direct relationship with a host network might cost you more than working through an MVNA, or Mobile Virtual Network Aggregate.

Therefore, if you are going for imposer simplistic business model, like that of a branded reseller, according to Mehul Vora from Pareteum, expect at least $25,000 to $80,000 in initial costs. That if you have a good relationship with the host network in question, otherwise, the price may rise.

The path of branded resellers, however, is among the cheaper options and saves you the hassle of legal and technical things. The downside of that is that you will not have much control over your offerings, and that you must start selling as soon as possible. Also, advertising is a central part of your role as a branded reseller.

On the other hand, the path of the Light MVNO or Full MVNO. Costs do go up significantly, but the benefits might outweigh them. Light and Full MVNOs tend to have much more control over their offerings, applications, services billings and ratings, customer care, sales and marketing

There are companies out there that specialize in helping to launch MVNOs that an aspiring communication businessperson might want to reach out to. In any case, the ground is fertile for the establishment of a an MVNO.

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