A User Centric Always Best Connected Service Business Model for MVNOs
Mobile Connectivity Platforms
“A User Centric Always Best Connected
Service Business Model for MVNOs”
(Waterford Institute of Technology, Ireland)
Miguel Ponce de Leon
(Waterford Institute of Technology, Ireland)
Summary of the Paper
• Current state of MVNO model.
• Opportunity for MVNOs in IP-based
• Introduces a new MVNO as a Broker (MVNOB)
• Analyses the characteristics of the conceptual
• Limited usefulness of technology-push factor in
the diffusion and adoption of new technology
and services .
- Calls for market-pull business models.
• Growing popularity of flexible and agile business
models (Eg. SaaS, PaaS).
• Service Provider Model is seen as the best
framework to promote innovation in the mobile
communications market .
Limitations of Current MVNO Model
• Current MVNO model is based on the concept of
• MNOs can set the network lease prices high
enough to increase the barriers to entry for
- Long term viability of MVNO is unclear from the existing
telecom industry structure .
• Promotes cost leadership over service
- Higher customer churn rate and lower profit margins.
IP-based Application Services
• Formerly distinct industry sectors like telecom
and content industries are converging over IP.
- Provides better differentiation possibilities for focussed
virtual operators .
• Industry structure has an impact on service
• Vertical network applications can be integrated
into one IP-based convergent network for both
fixed and wireless communication services .
The Missing Perspective
• User-centric view.
- Users contend for a network connection instead of
operator networks contending to satisfy the users
• SAHARA model  considers the service
composition across multiple providers.
- MVNO and MNO agreements are static and agreed
long in advance making user dynamic inefficient.
• Perimeter project 
- Development of services independent and portable of
the underlying access and transport network.
Value Chain to Value Network
• Vertical integration of the telecom industry will
be unable to satisfy the new range of VAS .
- More collaborative business models based on core
competencies are likely to emerge   .
• Next generation mobile services will leverage
robust access platforms , with the emergence
of a dedicated service composer  .
- MVNOs are in a better position to deliver innovative
VAS as more tightly integrated partners with MNOs .
Actors and their Roles
- Role: Technical outsourcing partner to the MVNO.
• Possible candidates: Existing MVNEs, System Integrators,
Equipment vendors, Internet Services Companies, and MNOs.
- Role: Customer facing.
• Possible best candidate: Grocery and General Merchandising
• MVNOB = Service Composer + Retailer
• Cost of delivering mobile data is likely to exceed
incremental revenues and become
unsustainable for the mobile operators by 2013.
Chetan Sharma Consulting 
• Customer life-cycle management is hard to
implement in pre-paid mobile services, 3/4th
the global mobile customers are pre-paid ones.
• Flat-rate-based business model is likely to
commoditise MNOs as bit pipe carriers.  
• Reduces cost by adopting a common standard (IP).
• Promotes successful resource sharing as the actors are
• Encourages service differentiation through real-time
open negotiation for services and network access.
- This will become especially prevalent with the deployment of IMS.
• Capable of supporting various billing plans, and
generating a single bill for the customer of all the
services consumed from multiple-MNO.
- eg. pay-per use/view/time
• Possible Long Tail Effects.
Adoption Prospects 
• Relative Advantage
- Economic benefit of service bundling.
- Micro-segment customer offerings.
- Orchestration of the services from different MNO
platform for customer-specific delivery is probable over
the Internet Protocol.
- Major issue could be non-technical due to the likely
resistance from the MNO to give away control over the
- Shifts product life-cycle management from an off-line to
a real-time process.
- Will mainly depend on service attributes,
personalisation, and the management of personal
identifiable information within the ecosystem.
- Social activities like sharing and recommendation by
the users are likely to have a major influence on the
subscription of the services.
• The suggested MVNOB model:
- Changes the telecom industry structure by introducing a service
composer between the MNO and the customer.
- Envisage dynamic formation and dissolution of user-network
relationships of short time-scales.
- Promotes a unique service by making available the various
services from multiple-MNO under a single umbrella.
• MVNOs need to rethink their strategy and consider
positioning themselves as a broker of services in a
multiple-MNO ecosystem, with MVNE as their technical
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