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International Opportunities for Asian MVNOs and Service Providers
 

International Opportunities for Asian MVNOs and Service Providers

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With over 77 million Asian-born people living abroad, Cartesian considers the opportunity for Asian MVNOs and Service Providers to serve these overseas communities.

With over 77 million Asian-born people living abroad, Cartesian considers the opportunity for Asian MVNOs and Service Providers to serve these overseas communities.

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  • CSMG Vice President Mike Greening will be giving a keynote presentation at the Prepaid MVNO Local Networking Event in London on 7th March 2013.
    http://www.csmg-global.com/event/prepaidmvno-local-networking-event
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  • CSMG has published our latest thought study on the opportunities and challenges for MVNO in Africa. Check it out on Slideshare or view it on our website: http://www.tmng.com/knowledge-center/insights/mvno-africa
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  • CSMG will be at the MVNOs Industry Summit Middle East taking place in Dubai next week from 4-5 December 2012. Mike Greening will be Chairman for Day 1 and delivering a presentation on Day 2 on 'Global Learnings with Relevance to the Middle East'. http://www.csmg-global.com/events/mvnos-industry-summit-me-2012
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  • CSMG will be speaking about emerging MVNO opportunities for 2013 in a webinar on 15th November 2012. For further information and to register for free, check out: http://lnkd.in/SU6kxV
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    International Opportunities for Asian MVNOs and Service Providers International Opportunities for Asian MVNOs and Service Providers Document Transcript

    • Opportunities for Asian Service Providers in Foreign Markets By Michael Dargue and William Wadsworth MVNO and OTT voice applications create significant opportunity for Asian service providers to expand beyond their home markets. Many nations, particularly in the Western world, now have a considerable Asian population. MVNOs targeting ethnic groups have thus far proved popular, and despite some Asian operators already moving to capture specific markets of foreign nationals, competition in this space is still relatively low, with many further markets available to capture. October 2012
    • Cartesian: Opportunities for Asian Service Providers in Foreign Markets Copyright © 2014 The Management Network Group, Inc. d/b/a Cartesian. All rights reserved. 1 The Future of Asian Mobile Markets The current state and outlook of the Asian mobile market varies greatly between different countries, but in general, Asian operators are seeing opportunities to grow revenues within their home nation becoming increasingly limited, as competition levels to erode ARPU and as penetration-level growth begins to slow. Despite the revenue potential of new technologies such as high-speed mobile broadband, some Asian operators have concluded that they will need to look beyond their traditional home market in order to maintain the high levels of growth they have previously enjoyed.1 The Developing Global MVNO Market While the MVNO model has not had a significant impact in many Asian countries to date, other nations’ mobile markets are now showing up to 10-20% virtual operator share. The success of the MVNO sector in these countries has been driven by a combination of favourable regulatory environments and innovative market propositions. 1 Ovum, Cartesian 78% 85% 90% 94% 97%88% 95% 100% 103% 105% 108% 112% 116% 119% 122% 113% 115% 117% 118% 119% 131% 135% 137% 138% 139% 50% 70% 90% 110% 130% 150% 2012 2013 2014 2015 2016 China India Japan South Korea Malaysia 11 10 9 9 8 8 8 8 66 63 57 55 54 53 52 51 3 2 2 2 2 2 2 2 36 36 33 32 31 30 30 29 18 17 16 16 15 15 15 14 0 10 20 30 40 50 60 70 2009 2010 2011 2012 2013 2014 2015 2016 Figure 1: Mobile (Voice and Data Services) Penetration Forecast for Selected Asian Markets 1 Figure 2: Mobile ARPU (Voice and Data Services) Forecast for Selected Asian Markets ($ per Month) 1
    • Cartesian: Opportunities for Asian Service Providers in Foreign Markets Copyright © 2014 The Management Network Group, Inc. d/b/a Cartesian. All rights reserved. 2 Figure 3: Total MVNO Market Share in Selected Countries 2 Accounting for 11% of MVNOs worldwide, one of the most prevalent types of MVNO are the Ethnic MVNOs, which serve migrant populations3 . Services which Ethnic MVNOs are able to offer to their target segment include: cheaper voice and messaging services to their home country; customer service in their mother tongue; tailored value-add services such as native language voicemail; “infotainment” services from their home nation; cheap communication services when returning to their home country; and remittance services to send money home securely and easily. In addition, through operating MVNOs abroad, local providers are able to offer better services for their home market – such as providing affordable communication links to the foreign market. For example, an operator in the former Dutch colony Suriname, Telesur, launched an MVNO in The Netherlands to help connect people in the two countries. Telesur offers local rates from, in, and between the Netherlands and Suriname by means of a multi-country SIM which provides subscribers with a local profile in both Suriname and The Netherlands. With customer care and content provided in both languages, Telesur has achieved over 20% market penetration in the target group, with substantially higher ARPU and lower churn than average prepaid mobile operators. The Asian Opportunity With over 77 million Asian-born people living abroad, Asia has produced a larger global migrant population than any other single continent4 . Many of the largest destination nations, are countries where smartphone 2 Cartesian, Nereo, company websites, press releases 3 Wireless Intelligence, Cartesian 4 Migration Policy Institute calculations of the World Bank Development Prospects Group's Bilateral Migration Matrix data
    • Cartesian: Opportunities for Asian Service Providers in Foreign Markets Copyright © 2014 The Management Network Group, Inc. d/b/a Cartesian. All rights reserved. 3 adoption is high and where the MVNO model is popular (see Figure 2) – such as the USA, the UK, Germany and France. Figure 4: Distribution of Asian-born People across the World’s 10 Largest Immigration Destinations 5 Some Asian operators have already launched offshore MVNOs to capture such opportunities (see Figure 5), but there are many Asian communities around the world that are yet to be targeted. Figure 5: Examples of Asian Operator-owned MVNOs Which Have Already Launched 6 5 Development Research Centre on Migration, Globalisation and Poverty 6 Cartesian, company websites, press releases 0% 20% 40% 60% 80% 100% Spain UK India Canada Saudi Arabia France Ukraine Germany Russia USA Destination Nations:
    • Cartesian: Opportunities for Asian Service Providers in Foreign Markets Copyright © 2014 The Management Network Group, Inc. d/b/a Cartesian. All rights reserved. 4 Key Considerations for Entrants Ethnic-focussed service providers will find it hard to compete on price alone due to volume limitations so should focus on the added value they can offer their subscribers, such as connectivity to their home country, language support, and specific appealing content and features. Many Asian operators have a brand which is well trusted by the people of their country, but even with this asset, a very strategic approach to keeping customer acquisition costs low would be needed in order to make the venture profitable. Entrants need to understand the justification for launch. A key question is whether the primary goal is to capture overseas revenues, or deliver revenue uplift to the core domestic business. This in turn will influence the optimum entry strategy: whether full MVNO, light MVNO or OTT voice application. Partner selection and assessment is also of key importance. Entrants pursuing the MVNO route will need significant support from the host MNO, requiring a collaborative and viable pitch and proposition to demonstrate the benefits they can bring. OTT voice offerings may also be developed in collaboration with a partner, reducing time to market, or built in-house. Those seeking international expansion opportunities will have to consider their entry strategy carefully. There is wide variation in local market characteristics across countries of interest; business models, propositions, brand and customer segmentation will all have to be analysed and tailored. Cartesian Experience and Support Cartesian has deep experience in assisting MNOs, MVNOs and regulators achieve their objectives. We have worked on over 40 MVNO engagements globally including supporting Asian MNOs develop and execute their international growth strategies. We can support across a number of areas, including:  Strategy and business case support, including detailed cost and revenue modelling  Negotiation support for contracts and commercial terms  Securing funding  Vendor and partner identification, evaluation and selection  Assessment of MVNO policy, regulation and market impact
    • Cartesian is a specialist consulting firm of industry experts, focused exclusively on the communications, technology and digital media sector. For over 20 years, Cartesian has advised clients in strategy development and assisted them in execution against their goals. Our unique portfolio of professional services and managed solutions are tailored to the specific challenges faced by executives in these fast- moving industries. Combining strategic thinking and practical experience, we deliver superior results. www.cartesian.com For further information, please contact us at cartesian@cartesian.com