Networks embrace wholesale change

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The UK MVNO market has caught fire, it seems. Network operators consider it now a means of revenue growth in a saturated market place, which is subject to considerable belt-tightening on the part of consumers.

And a host of new brands have entered the mobile sector suddenly, with apparent ease.
Swedish flat-pack furniture chain Ikea is the latest. Friday (August 8), it launched a prepay MVNO for its loyalty card members via a wholesale contract with T-Mobile, UK leader in the space by virtue of its long-standing carrier agreement with Virgin Mobile.

Orange is expected to confirm a deal this month with ethnic market MVNO Lycamobile, already running in six European markets and expected in seven more by the end of the year.

But the network that has been most aggressive, which has sparked the mad rush by UK airtime providers for wholesale share, is Vodafone.

In September 2006, UK chief executive Nick Read explained to the City Vodafone’s strategy for ‘winning in the market’. Wholesale, he said, was to be a key part of Vodafone’s growth plan at home.

Its share, then, stood at around six per cent, thanks to BT Mobile, originally signed back in 2004. Director of business development and wholesale Tim Stone put together a team of 37 in a standalone business unit in Vodafone’s Newbury headquarters, and set an open-door policy for wholesale – for discussions with potential partners at least.

"Vodafone has a number of ‘red brand’ things it is doing, and then there is the straightforward ‘make more money’ stuff. We sit clearly in that space, of growing service revenue from where it is today," he says.

Full article appears in Mobile News issue 420 (August 11, 2008).

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