A multitude of MVNEs

There is a large supply of MVNEs. Some facts: at the end of 2004 there were 686 GSM and 3G networks in commercial operation. At the same time there were, according to our estimates, around 100 MVNOs on the market and more than a third of these were supported by MVNE services – with a growing trend.

Even before the MVNO boom most of the suppliers of so-called enabler services were specialized in a particular part of the mobile value chain such as, for example, billing, customer care or network components. Driven by continuing price pressure in both hard and software the traditional system suppliers are particularly interested in increasing their turnover with the provision of profit-bringing services – which already account for approximately 25% of their turnover. The growing interest in enabler services is perfectly timed to fit in with this trend.

The enabler services on offer are not standardized and vary as much as the existing definitions of the MVNO business model. The complementary offers made by the MVNEs are generally not targeted purely towards mobile entrants, but are also attractive for resellers and service providers who are thus able to develop their business models step-by-step (see figure 1, next page). Detecon defines an MVNO as a mobile provider without its own radio spectrum which provides mobile services under its own brand name, with its own network code (MNC) and using its own SIM cards. Derived from this the minimum requirement is that the MVNO has access to core network platforms such as MSC, HLR, AuC and IN. If the MVNO wishes to differentiate itself further from MNO (Mobile Network Operator) through the provision of its own value added services and content, then VAS platforms and possibly content providers must be added to this list.