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The path to success as a Mobile Virtual Network Operator (MVNO) requires identifying your market niche. Ideally, a group of customers who are under-served by existing providers. Then, innovating to serve these customers better than anyone else.
MVNOs are mobile service providers that ‘piggyback’ on the network of another provider. Essentially, renting a mobile network, and adding margin on top.
In Australia, MVNOs have access to competitive features – such as 5G, and eSIM – and are winning a growing share of the mobile market.
The challenge of being an MVNO is that competition is fierce. Winning as an MVNO first means winning consumer eyeballs. Ambitious mobile operators need to add innovation if they want to stand out.
We believe there is a lot that Australian MVNOs can learn from providers in the US and UK. So we have scoured these markets to uncover 4 of the most innovative providers.
Region: United States of America
MobileX uses Artificial Intelligence (AI) to help the operator deliver its key differentiator: personalised mobile plans.
Customers on these AI-determined plans can sign up for an initial trial while their data usage is analysed. Based on their usage and habits, the AI platform will forecast how much data the customer needs. The customer will then be offered a personalised plan – often saving money in the process.
Many providers offer a ‘choose your own plan’ approach, but AI solves one important element: humans are bad at forecasting their data needs.
This problem is not unique to the US market. According to the ACCC, Australians use an average of 15.9GB of data per month. But our mobile data plans are often 2-3 times larger – with a higher cost to boot. In 2022–23, the median advertised data allowance was 40GB. Suggesting that, on average, Aussies are paying a premium for mobile data they don’t use.
At its heart the MobileX offering is a modern twist on the tried-and-true low-cost model of successful MVNOs. The use of AI to select a ‘best fit’ plan is a clever way to offer personalisation and tempt new customers with savings. All without positioning as a cheap discount operator.
Region: Canada & the United States
PhoneBox is an MVNO for migrants coming into Canada and the USA. By targeting ‘new Canadians’ and ‘new Americans’ it is reaching a large consumer market with no ties to a local telco.
The company works with banks, universities, and migration providers. So, it reaches customers while they’re still in their home country. By working with institutions, PhoneBox makes it easy for students and migrants to organise a mobile service before having their local bank account or local address.
The company has also tailored their offering in subtle but important ways. Customer service is available in 9 languages. Physical SIMs can be shipped worldwide for free. And SIM activation can be prescheduled – so you’re not paying until you arrive at your destination.
MVNO innovation does not have to be complex or technical. It can be as simple as identifying a growth market and tailoring your offering to fit.
We think that PhoneBox have picked a strong market for growth. It’s no secret that we’re big fans of the student and migrant niche – especially with the availability of eSIM services. In Australia, as with the US and Canada, education and temporary work are the biggest drivers of net immigration. It makes sense for an ambitious challenger to target this growing market.
By tailoring their plans and processes to fit international visitors PhoneBox now have a unique offer that stands out in a crowded market.
Region: United States of America
Helium is a different kind of MVNO. Alongside its main network it has a growing private 5G network crowdsourced from its own customers.
Helium asks its customers to install hotspots in their home or business, expanding their mesh network and filling in coverage gaps. Participating customers are rewarded with MOBILE Tokens. The tokens are accepted as payment for Helium services and can also be traded on a cryptocurrency exchange.
Helium addresses a key strategic challenge of MVNOs: coverage is only as good as what your network partner allows. By adding-on a secondary network, Helium is building both a community and a unique value proposition.
The crypto rewards layer will likely appeal to technology enthusiasts. As will the ability to operate part of a decentralised wireless (DeWi) network.
In Australia, private 5G networks are already being used by universities and industry. However, we don’t have a ‘free’ public spectrum allocation like the US and the DeWi model is far from mainstream. We watch this space with interest.
Region: United Kingdom
Gamma Mobile is a business focused MVNO which delivers its services through a network of hundreds of Channel and Wholesale partners.
The Gamma Mobile product is geared towards business use, and its feature set reflects the unique needs of this market. For example, Data Pooling plans, which share a single large mobile data allowance across tens or hundreds of users within a company.
A key innovation is their ‘tariff optimiser’ which automatically puts customers on the cheapest mobile rate based on their usage. Any savings from their monthly plan fees are then credited back. Gamma partners can choose whether to pass this saving onto their client – or pocket the margin.
Gamma’s ‘tariff optimiser’ is a clever response to mobile commoditisation. In the UK, as with Australia, data quotas are now so large that it’s no longer a differentiator. Tariff optimisation is a way to include unique and tangible value without focusing entirely on the end cost.
It also makes sense for Channel Partners. The IT services business is very competitive and only the most successful providers will ‘graduate’ to become higher-tier telcos.
The return of unused mobile credit is a masterstroke in our view. Some partners will choose to keep the credit – a crucial source of extra margin.
Alternatively, others will choose to return the credited value back to their end customer and earn their goodwill. We see this approach as a clever mix of innovation and integrity.
If you’re an Australian mobile provider, or aspiring to become one, Telcoinabox is the enablement platform that can power your telecom business.
We provide a turnkey suite of wholesale mobile, voice, and data services. Plus, the ability to create plans and pricing to suit your market (and achieve your preferred margins). All customised with your own white label branding.
If you have a big idea for a mobile innovation, we’d love to hear it. Get in touch today and learn more about what’s possible with Telcoinabox.
