Mobile virtual network operators (MVNOs) should leverage network expansion and 3G deployments by creating strategic partnerships with the carriers. MVNOs are emerging as one of the better options for carriers due to their focus on specific market segmentation, differentiated services and customization; however, developing innovative partnerships is critical.
New analysis from Frost & Sullivan (wireless.frost.com), North American Mobile Virtual Network Operator Markets, reveals that the market earned revenues of $3.2 billion in 2006 and estimates reach $10.7 billion in 2013.
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"With the upcoming 3G network standards, MVNOs will be able to leverage their underlying carriers’ network strength and capacity to offer an array of differentiated products and services to both consumer and enterprise markets," says Frost & Sullivan Program Manager Samir Sakpal. "This will encourage stickiness with the consumers and will help MVNOs realize incremental subscriber and revenue growth, while providing solid value through services."
Considering MVNOs are not likely to emerge as mass market wireless service providers, they will have to devise a strategy that will help them achieve a balance between costs and revenues. They also need to design and offer the most compelling segment-specific data, products and services to guarantee customer loyalty among their target audience.
So far, the North America operators have merely scratched the surface of the money-spinning MVNOs market. They have shown no urgency to make further forays into the market, and have catered mostly to the youth segment by offering interactive games, music and videos.
Once the MVNOs recognize the potential of the market, they will begin to serve the more lucrative segments by developing a broader reach. Newer MVNO models will spawn innovative growth and tap into the still latent opportunities for MVNOs in the North American market.
MVNOs can also leverage 3G network technologies to gain subscriber and revenue growth by providing inventive products and services to diverse market segments.
"With 3.5 million 3G subscribers in 2006, the subscriber base estimates to grow to approximately 30 million by the end of 2012, at a solid growth rate of 94 percent," notes Sakpal. "The upgrades in network technologies and the growth in the subscriber base will enable MVNOs to offer interactive and innovative mobile content suitable to their chosen market and thereby, garner substantial revenue."
Market participants should plan meticulously and ensure adequate funding for operations, so their efforts to enlarge their subscriber base are not stalled. They could partner with mobile virtual network enablers (MVNEs), carriers, device manufacturers, and content providers to implement back-end and operation systems such as billing, customer service, and content development and management to ensure continued growth.
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