The sector of Mobile Virtual Network Operators (MVNOs) is undergoing a major period of transformation and dynamism:
First, there is strong demand for accessible telecommunications services due to the opening of new markets and the increased use of mobile devices. At the same time, we are witnessing a period of technological transition that will bring advances for both telecommunications operators and the rest of the industry, where demand for these services will come from.
All this offers new opportunities and challenges for MVNOs. In this article we want to tell you about the five main trends for MVNOs in 2022.
1 – The search for new target segments.
One of the advantages that MVNOs have over large operators is that they can target very specific segments of the public (a topic we’ve already touched on in this other article about MVNOs), a trend that is set to continue in 2022.
This will be of particular interest to MVNOs that are part of traditional operators, i.e. that act as a sub-brand of the latter, such as O2 (Telefónica’s MVNO) and Simyo (Orange’s MVNO). By reaching customers under a different brand identity, they can adjust their service proposition specifically for that niche, while maintaining their original strategy and message with the parent brand.
As for independent MVNOs, their success also depends on offering a service package differentiated from other operators (especially traditional ones), identifying themselves with their target segment in terms of price, services, image, etc.
Given that we’re going through a period of digital transformation at many levels, new MVNOs are likely to emerge focused on specific industries, including services related to the Internet of Things (IoT), machine-to-machine (M2M) communication, cloud services, etc. With the expansion of connectivity at all levels (vehicles, wearables, industrial and residential equipment, etc.), MVNOswill appear offering “out-of-the-box connectivity” services to cover these new emerging niches.
2 – Commitment to innovation and transformation
The MVNO market is highly saturated and there is strong competition. Just in Spain there is already an extensive list of virtual operators, as this article reveals. New MVNOs continue to emerge to fight for a slice of the pie as the weaker ones are forced to disappear.
In this context, a price-based strategy is becoming increasingly problematic. With a growing number of operators, it’s becoming increasingly difficult to find profitable niches, so operators are forced to look for new ways of differentiating themselves.
This differentiation will come from innovation and the transformation of MVNOs, enabling them to offer more value in their services while reducing structural costs. This has been seen, for example, in the development of new technologies that improve the quality of calls via Wi-Fi, new methods for ensuring the security of data transmission, etc.
This innovation will enable MVNOs to be more flexible and efficient, gaining an opportunity to differentiate themselves in the perception of the consumer.
3 – Incorporation of new technologies.
As mentioned in the previous point, innovation will generate a new range of possibilities for MVNOs. An important part of this innovation will come from the incorporation of new technologies in their operations and catalogue of services.
There are a number of key technologies that present a great opportunity for MVNOsat the moment. The main ones are:
- eSIM: also known as virtual SIM. This is a SIM integrated into the devices themselves, which allows an additional line of connection within the same equipment. This offers a very affordable way for users to stay connected without the need for extra installations.
- Network Functions Virtualization (NFV) and Software Defined Networking (SDN): these technologies will reduce the time to market for new services and enable better cost management.
- Artificial Intelligence (AI) and machine learning: technologies that will enable greater personalization by increasing the processing capacity of data obtained from an ever-growing number of devices, especially those used in the IoT (Internet of Things).
- Blockchain: a technology especially important in everything related to security, such as payments over the phone, online banking, etc. It will also have an important application in multi-organizational relationship environments, as in the case of supply chains.
- Edge computing: this technology allows data produced by devices to be processed closer to the source instead of being sent throughout the network, offering services with lower latency.
The development of many companies will also be influenced by the application of these technologies, which means an increase in demand for these services in the coming months and years.
4 – Market expansion in Latin America
The telecommunications industry is growing in Latin American countries, which offers a great opportunity for MVNOs to expand. In many countries there are significant sectors of the population that do not have a mobile connection and are therefore potential customers for MVNOs, which is why more are appearing every year.
Smartphones are becoming increasingly accessible to people in Latin America and there is a demand for affordable telecommunication services, creating a perfect scenario for MVNOs. In addition, it’s common for many of these countries to look for actors such as administrations or private entities that promote initiatives to drive technological progress in society, which is a plus for the sector.
5 – Transition to the full MVNO model
We’ve already covered in our blog topics such as the different types of MVNO and the main MVNOs in Spain. There we said that the most widespread type of MVNO is known as an MVNO service provider, which is basically a reseller of the services offered by the traditional operator.
We’ve seen that the trend is to seek greater differentiation and customization, something that is difficult to achieve under a reseller model. However, there is another type of MVNO, the so-called full MVNOs, which do offer greater flexibility and independence. Let us remember at this point that MVNOs do not have radio communication infrastructure (which is why they need to operate under the coverage of other operators), but they can have other types of infrastructure, as Full MVNOs do.
This model allows MVNOs to have greater control over the business, thus being able to improve the quality of the services offered. As a result, several MVNOs with other models are tending to lean towards this change.
Specific services for MVNOs
Due to their distinctive nature, MVNOs also require differentiated services for their development. At Centum we are aware of this and that is why we offer services specially tailored for MVNOs. If you are interested, please do not hesitate to contact us.
