What are the world's most competitive MVNO markets? What do they look like? MVNO Monday Editor Tom Leins decided he was going to take a closer look. First up: Tom explores MVNOs in the United Kingdom.
1. Virgin Mobile is the oldest MVNO in the UK
Virgin Mobile has been synonymous with the MVNO sector’s development since launching in the UK almost 20 years ago.
The trailblazing virtual operator launched back in November 1999–over the One2One network–and such is the enduring appeal of the well-known Virgin brand, it has outlasted a number of defunct UK mobile brands, including: BT Cellnet, Orange UK, T-Mobile UK, Everything Everywhere, and even that of initial launch partner One2One.
Today, Virgin Mobile offers services over the EE network, and ranks as the second-largest MVNO in the UK, behind only Tesco Mobile.
2. Sub-brands are mobile operators’ secret weapons
O2 UK-backed online-only player giffgaff has carved itself an impressive reputation since launching in November 2009 with its online-only proposition, and extensive network of “members” (they don’t refer to them as customers).
Pitched as the “edgy little brother” of O2 UK, giffgaff now has around 2.7 million members and remains a big influence on MVNOs across Europe. Given the level of success enjoyed by giffgaff, it was surprising that none of O2’s rivals sought to replicate its approach—until the summer of 2017, when both Vodafone UK and Three UK entered the MVNO space via VOXI and SMARTY, respectively.
3. The world’s largest mobile operator has entered the UK MVNO market
In December 2017 China Mobile International, a subsidiary of China Mobile – the world’s largest mobile operator by subscribers–launched an MVNO in the UK under the CMLink brand name.
The new virtual operator piggybacks on the EE network and targets the 433,000-strong Chinese community living in the UK, alongside the 82,000 Chinese currently studying there on student visas.
The new virtual operator piggybacks on the EE network and targets the 433,000-strong Chinese community living in the UK, alongside the 82,000 Chinese currently studying there on student visas. Interestingly, the launch means that all three Chinese mobile network operators are now active in the UK MVNO space; China Telecom launched CTExcelbiz over the EE network back in May 2012, while China Unicom launched CUniq over the O2 network in December 2016.
4. Utility firms are leading the multi-play charge
In Europe and beyond, the ability to offer so-called quad-play services is a key motivator for fixed line operators and cablecos to launch MVNOs, with Virgin Mobile/Virgin Media and TalkTalk key examples in the UK.
A trend that is likely to come increasingly to the fore, however, is that of utility providers embracing telecom to boost their business propositions. The best known exponent of this in the UK is Telecom Plus (trading as the Utility Warehouse), which supplies gas, electricity, fixed line broadband, and mobile services to both residential and business customers.
MVNO growth remains modest, however, and the company’s MVNO user base stood at 214,243 as of September 30, 2017, with electricity and gas customers continuing to account for the lion’s share of the company’s end-users.
MVNO growth remains modest, however, and the company’s MVNO user base stood at 214,243 as of September 30, 2017, with electricity and gas customers continuing to account for the lion’s share of the company’s end-users. The slow uptake has not dissuaded other from embracing the same strategy, however. Founded in 2016–and following in the footsteps of its Italian sister company–Smartplay Group offers mobile, fixed line, broadband, electricity, gas and insurance. And 2017 saw the launch of Coventry-based Economy Mobile, which is backed by independent utilities company Economy Energy.
5. Wales has its own dedicated MVNO
Wales, the third largest country in the UK behind England and Scotland, has had its own dedicated MVNO since the launch of RWG Mobile in July 2016.
RWG, which offers services over the Three network, pitches itself as “the mobile network for Wales. Run by people in Wales, for people in Wales…wherever you are.” Speaking to TeleGeography, as part of the MVNO Monday executive Q&A series, CEO Andrew Davies said, “Our target market in those who live and work in Wales. We have created a national brand with a bilingual service for the Welsh population.”
Tom Leins
Tom Leins is a Senior Research Analyst for TeleGeography’s GlobalComms Database. Based out of the company’s UK office, he also contributes to the company’s daily CommsUpdate newsletter, which includes his popular weekly MVNO Monday round-up. MVNO industry aside, Tom has developed a strong specialization in the U.S., Latin America, and the Caribbean, tracking mergers and acquisitions, spectrum auctions, regulatory developments, market opportunities, and growth trends.