Showing posts with label LTE. Show all posts
Showing posts with label LTE. Show all posts

Thursday, 11 July 2013

MVNO Conference 2013 Rome LTE MVNO opportunity

I though I would share my slide and thoughts on LTE and the MVNO, having written many of the requirements, negotiated a major full MVNO with LTE and now building the full LTE MVNO, here in the UK for yet another FTSE 100 company entering mobile.
The Opportiunities for LTE in MVNO and LTE wholesale are huge
I feel in a strong position to talk about the opportunity because I have negotiated a lot of MVNO agreements over the last 10 years across mostly Europe, which has seen the advent of 2G MVNO and 3G MVNO and its contractual, organisational and other issues. Also because at Virtuser we run a lot of value added services for MVNOs, like top-up over SMS and OTA data settings for MVNOs so we see what handsets are being used, what data propositions are being used and other first hand experience of not just walking the talk, but walking the walk, to use the consulting analogy (consultants are often accused of only being able to talk the talk, or at most talk the walk :))
In assessing the LTE MVNO opportunity, we need to look at the facts, not 3G+
Its important that we look at the facts when assessing the LTE opportunity and not make the 3G mistakes, not only on the commercial proposition side, but also from a network and business side. That is: its clear that 4G handsets are slower in uptake than 3G, and that so far this service, as such, commands a premium over 3G. We also know that data currently represents high double digits percentages of network running costs (87% in the case of a major MNO in the UK) but no where near these levels of revenues. We also know that while mobile data costs in the region of 5X the cost to provision, it does not command a yield price 5X that of fixed broadband data due to strong competition on the MNO retail market... Wholesale therefore is a significant opportunity for MNOs and MVNOs to charge the higher yields and returns to MNOs and MVNOs alike in this space. This will require the MNOs, and their notorious contracts to adapt and enable all new MVNOs with "4G ready" status.
Please can we not see MVNOs still launching with 3G SIM cards 7 years from now like with 3G
 I was still negotiating 2G SIM card deals for MVNOs in 2007, 7 years after 3G! All new MVNOs should be 4G ready MVNO or LTE ready MVNOs, however you wish to call this. This means 4G MVNO SIMs, but also 4G LTE MVNO on the MNO roadmap, in the commercial contracts and support services.
4G has had a lot of marketing spend and will be big, but a 4G MVNO campaign does not need  huge spend
A lot of marketing money has been spent on 4G and it will be big, but that does not mean 4G MVNO marketing needs to be big. Sure, EE has spent tens of millions, if not hundreds, on Kevin Bacon on prime TV ATL campaign... but they also launched #OM4G around the social networks and hit exactly the same audience for the cost of a couple of your marketing execs and some creative freedom free of corporate risk constraints (unlikely in an MNO :)) Data MVNOs like Bliep* launched and grew almost entirely on Twitter. Cheap marketing and a niche = low SAC, the mainstay of wholesale. add the fact that MVNOs are generally attracting a higher yield for their data and we have an ideal scenario for 4G to pull us out of the 3G hell we have, where heavy competition and unlimited packages mean 5% of the users are using 95% of the data and nobody can get a fast connection when they need it, reliably at least.
Clever Twitter and social marketing by MVNOs that is too risky for MNOs can hit at core 4G data market with low SAC
So the dawn of clever MVNO marketing is already here, and shifting the focus of MVNO marketing spend from being like MNO spend (mainly ATL with some dabbling elsewhere) to very experimental, experiential and social marketing... exactly what internet savvy 4G target market consumes. So no need for an overcomplicated six degrees of separation to attract a market and generation who are more 4G aspirational than 4G ready.
So you got past 4G and LTE contractual, MNO roadmap and other issues: is your MVNO platforms operationally ready?
Many MVNOs today have 3G, however nobody uses it as they are obsessed with competing with MNO bundles. The fact is that 50% of UK smartfone users use less than 100mb of data, and the rest use around 200mb. That means that by paying as much as 5p to 10p per megabyte on an MVNO, these users will be better off than getting an unlimited MNO tariff. What is more, the host MNO is better off, as retail yields are around ten times less than this. The MVNO is better off, as these data revenues are what shifts MVNOs form what I call a "£10 minus ARPU MVNO" to a "£10 plus ARPU MVNO".

By enabling the most advanced OTA MVNO data settings on the market we have seen huge growth in data usage in even markets which the MVNO would never assume they could generate usage.
The key issues around negotiating LTE MVNO and getting an MVNO 4G ready

The back-end is still critical, even the slickest MVNO architecture from tier 1 providers does not come with the back-end to enable MVNO friendly OTA and APN data settings, some of them incur up to 50% of customer care calls, which at an average of around £4.50 cost to an MVNO of a customer care call today, can easily wipe out the increased ARPU from data, and even all the profit from a user. Finally, the proposition needs to work. From running the SMS tariff top-ups form MVNOs we have great insight to the propositions MVNO customers actually buy, and they are very different from what most MNO propositions are, and a world away from the tizzy that MVNO management and proposition consultants can whip themselves into.
Every informative case study should end with a shameless plug for our services Virtuser MVNO consultancy :)

Thursday, 24 January 2013

MVNO 2013 Rome Conference

The MVNO 2013 Rome

The MVNO conference is moving to Rome from Barcelona!

MVNO Awards

There is an exciting new MVNO Awards to recognise innovation in MVNO, I will be on the judging panel and really looking forward to this exiting new development


There will be some interesting discussions on LTE in the MVNO MVNE space during a breakfast briefing and a panel, etc I will be chairing, so look forward to that as well! 

Meet MVNO Blog

I shall be there for the whole event, use the MVNO contactify link top right or one of the social network links to get in touch...

...and much more, see below:

MVNOs World Congress 2013
Date: 22-24 April 2013

Event description: The event is in its twelfth year and is the flagship event in the seven-event global #MVNOIS series.  Moving to new venue city Rome in 2013, the event will focus on the global opportunity for MVNOs with dedicated streams on CEM, M2M, LTE, WiFi, Quadplay, Retail, Brands and Roaming.

Event Highlights:
·         NEW! MVNO Start-up Summit – introducing the CEO’s of the newest MVNOs to the stage to answer audience questions on wholesale SLA’s funding, marketing, launch and gaining those vital subscribers!
·         NEW! MVNO Awards - celebrating the latest innovations and success in the MVNO industry
·         Dedicated Focus Day on Brand, Retail and Roaming – featuring Poste Mobile Italy, The Post Office UK, Tchibo, Trace and Virgin Mobile, Dobrytel and Roam Mobile.
·         Dedicated Stream on CEM and Partnerships – featuring Solavei, *bliep and Ting
·         NEW! Breakfast Briefing: 4G Wholesale by Alex Besen - In-Depth Look at 4G LTE Wholesale Business Models & Partnerships
·         NEW! The Congress moves to Italy this year.  Make the most of your opportunity to network and socialise in the beautiful city of Rome.
·         Global Focus – Global MVNO update covers Europe, Asia, the Middle East, Africa, Latin America, Central and Eastern Europe for the most comprehensive insight into international MVNO activity
·         NEW! Focus on Central and Eastern Europe – reviewing and analysing the latest MVNO launches in CEE
·         Extended Exhibition, on-site demos and networking opportunities. See the latest innovations and meet leading MVNEs, MVNAs and technology specialists.

Sunday, 20 January 2013

Converged MVNO

Original Converged MVNO article 2008:

Converged MVNOs

Convergence and the Mobile Virtual Model work well together, in principle
I once set-up a converged MVNO with my own hard-earned cash, that was in 2001... It seems that this model is now about ready for market! However, it is a very different model and a very different market.
In 2001 I set up a converged MVNO based on business use, where the primary focus was voice, as other such as bluephone, then BT fusion were focused on voice. However, the focus has now shifted to data; the reason? One is that regulators have pushed down roaming charges, the other is that users are more savvy and have multiple phones. The real reason is that voice, which is what GSM was invented to do, not data, is very effective over licensed spectrum, with multiple slots giving high(ish!) quality, and within the present price landscape, the ability to "bargain bucket". That is, there is nothing stopping any mobile operator bundling more and more minutes to squeeze out converged competition, at least in the single-country environment in which spectrum is licensed.
Data, however, is a different matter, with the idea that we will all be walking around watching IPTV, downloading MP3s, email attachments, pictures and videos, while having a video call... well the licensed spectrum bandwidth is just not there, at any price.
It is an interesting twist that just 7 years after I first spoke at 3GSM Cannes and caused silence over my intention to push email and voice over Bluetooth in offices, a silence caused by the imminent threat of losing money, that you can download an application called truphone for free to do just that over wi-fi, you can get your email over the mobile network via blackberry, using sms that are not charged for... and nobody is making the money that I was offering the host mobile networks (MNO) back then by operating a converged MVNO.
There are converged MVNOs however, and many MVNOs have invested in broadband in order to facilitate the already undertaken testing and research, some examples:
  • O2 have bought Be, one of the better broadband ADSL2+ providers, the parent Movistar already has Broadband
  • Orange have bought Wanadoo, multinational
  • Vodafone not only have broadband, but also host the BT converged MVNO, one of only a few commercially available
  • Cingular, Bell, Orange, Vodafone, and many others were testing the earliest convergence products by 2002 and 2003, shortly after I began testing them in 2001
However, there have been very few commercially rolled out services:
  • BT Fusion, was Bluphone, to a small UK MVNO audience
  • Tesco in simple VoIP format
  • Bell have rolled out trials, but it has not been the next mobile killer application a la PTT by a long shot
  • ... hopefully coming soon
originally posted by Christian Borrman 18:51pm 07/05/08, last updated 13;11 25/05/08

Saturday, 9 June 2012

LTE data MVNO and wholesale LTE


I get asked a lot about LTE and the MVNO, and well be speaking about it and chairing a panel on it at the 2013 MVNO conference. Imust get asked about LTE and MVNO as much as I get asked about LTE and mobile apps if not more, and given that apps is a much, much bigger industry, well then it must be a big question!

Like many "MNO things" in MVNO, if you apply them without any thought, i.e. in what we will call a legacy manner, again, it will be your quickest route to MVNO failure, as you will just be selling what a bigger version of you is selling and spending more on marketing on and has bigger margins on so can squeeze you. However, I also get bored silly at conferences and meetings on LTE and the MVNO and how LTE will impact the market in general, and the main reason is that a lot of people are applying the same old principles as they did last time and the fundamental mistake:

Technology does not solve problems; it presents opportunities that can solve problems, but then this solution comes with its own set of problems, like everything in life...

The Fundamental mistake in terms of an MVNO is the fact that most MVNOs are still not leveraging 3G or even 2G data, how is evolution going to make a difference: the answer is manifold and varies depending on where we are talking about and the market there:

  • In general: in general the only difference could be that hopefully LTE will make the MNOs a little more open to discuss data propositions for the MVNO. At present, MNOs, even the good ones, tend to have a mental seizure with data, as they expect the MVNO to assume the risk of arbitrage. MVNOs in turn, then have a similar level of mental breakdown when they insist they need bundles... when in fact they can get on selling at least 30% to 50% of the data they can sell by simply selling data to the 50% of the market that use under 100mb of data per month as I mentioned in a recent post and not worry their MNO with potential capacity strains that cause their MNO mental seizure in the first place. The reality here is that the MNOs should stop flat rating data that causes this issues in the first place, however they will not for fear of churn, or if they all do it price collusion, so LTE may well be the catalyst that spurs proper MNO data pricing that does not let 5% of the data leeching users ruin the experience and business models of the rest of the world!
  • US market. Here LTE will be different, in that the CDMA players will finally have a play in the multimedia IMS space and a much more equal pegging that the two tier wholesale market at present, where the CDMA wholesale rate reflects the lower desirability of end users and business over GSM based solutions. We can expect the LTE players to be able to launch more, and more exciting MVNOs with LTE
  • Data SIM usage. I have been saying for a long time (5-10) years that there will be a rise of SIM usage and that the MNO will not want to, let alone be able to fulfil all of these opportunities themselves. Indeed, if they do not, many of them will find less appealing alternatives that cut out the MNO all together. An example is GPS, at present people either tether to their phone when they can be bothered for probably 5% of journeys, or download off-line or even use a dongle: in essence, the MNO is making nothing here as this data will inevitably be an unseen blimp on a flat rate data tariff, or an extra 2mb twice a year on a standard tariff, or at worse be by-passed altogether (download via ISP). if they do a deal with an MVNO that manages these SIMs (maybe 1,000,000 SIMs to an HLR and low QoS, latency, etc that these devices will work fine with, vs. high availability, fully loaded generic SIMs or even MNO M2M SIMs which are still engineered towards an average scenario and over engineered quality that IBM requires, not what Joe Blogs wants for his 10 different devices....) the user will happily pay Tom Tom or Garmin £5 per month for the SIM and some other services they bundle, like auto updates, being able to track where you have been on a website, and even pay another £5 per month for the data; for every journey. This could be £2-5 per month incremental revenue for every TomTom or Garmin in car navigation device sold. As, I believe KPN coined the phrase; "wholesale is better than no sale". at present 95% of PAID mobile data solutions go unfulfilled... (I have run some numbers for this based on business models that have not made it, vs. the whole of business models I have put to market, and the lack of extra data sold on those that did go to market - its shocking!)
  • M2M, as above, M2M has been engineered to the early adopter solutions that were defined by consultancies and technologists to cater for the first proposals, like tracking shipping containers around the world. Without going into details, the MNO is geared presently around small amounts of data over long periods of time and usually extended or wide spread distances. There are many other niche opportunities that have been aching to get to market, but have not been on thee in-house radar. All LTE will add, I hope, here is the ability for a two tier model of large local bandwidth and widespread lower bandwidth, which is not catered for at the moment without using wi-fi for the high bandwidth. While this may seem like a solution, if you think getting mobile coverage in your home, office and other locations is hard, try covering whole company locations and warehouses with wi-fi and integrating it with thee mobile network: there are many who will say its easy, and they are either lying or have never had to project manage the mess they designed! an all-mobile solution for this will be a game changer, assuming it changes the mind-set
The worst part? that the first and the second two could be done now, just that LTE will change the way a) people perceive data at the wholesale level, and b) will drive MNOs to drive usage and so we will see the business plans that were possible technically 5-10 years ago, finally be enabled, not by a technology, but by the circumstances that the arrival of a new technology has created.

If you like this article, please like us on facebook/mvnos or follow us / +1 on Google+ and of course follow us on twitter @MVNO_ 

If you want to discuss how you can enable data revenues for your MVNO or MNO wholesale department then use the contactify link at the top right of this page and get in touch

Monday, 21 May 2012

VAS, Facebook and the MVNO continued...


As many of you will know, I feel quite passionately about VAS and the MVNO. This is not just an obsession, its just a realisation that any good business needs a tie-in, a value-add, a "something" that means it does not sell on price alone, and so when a newer, shinier competitor comes along, in order of preference the customer goes:
  1. ah, but, does shiny new things do, this? no, thought not - high value - major competitive advantage
  2. I would have to change the way I do all my...(insert VAS here) to work with the new service, medium value - useful advantage
  3. I would have to update all my details, low value - would just be a pain to move, like moving bank account or electricity provider
The problem is, most MVNOs, and even some MNOs are not even on point 3 level of VAS.

So why not? well there is a list of reasons why from a legacy perspective this was the case, however things are changing

The usual ways to leverage data was content, content, content. were an expensive portal, streaming video, etc, etc. These days are gone, and the proof is the above. Indeed the days were never there, the amount of conferences I have chaired, attended and spoken at where "content" was the supposed issue, and all I could say was, customers have content: its emails (blackberry proved this to be the case!) and the web in general, but on the mobile. 

Facebook is driving MVNO

The proof is hand is this article: showing that facebook access from mobile has now surpassed computer access. I am honestly not surprised. In fact, in app development focus groups even 3 years back, we saw that a good mobile app, like only apple had at the time (an app that did not look like a mobile web browser, allowed upload of images and push notifications, chat) managed to completely shift usage of Facebook from computer to mobile, while more basic ones and now the very good mobile web experience manage to take a good deal of it.

The reasons for this are multiple, 
  • many people do not have access to unrestricted internet access or facebook at work
  • most of those who do would rather not be seen using facebook at work
  • using Facebook on a PC raises probably more privacy issues as computers tend to be shared more and have more browsing history that people may not want plundering so facebook can make more advertising revenue
  • the key one however is convenience, Facebook, and indeed our digital lives, are now round the clock, constant streams of info, updates, feeds, chats and more: mobile just suits this better, whether its from a web browser or an app

VAS is driving MVNO data

In fact, everything that is driving MNO data, is driving MVNO data, unless as an MVNO you make data difficult, like by not having the world's most advanced OTA data APN settings :).

The key is, with it being so simple to get this working, why are so many MVNOs still rendering themselves as a low value, sim-swapping bitpipe when all they need to do is get APN settings set-up, and some simple data tariffs. As we have seen, most users are using less than 100mb per month anyway as per my previous article on this blog, and as per my blog on Apps and App stores showing that even the most basic MVNO type handsets that many MVNOs perceive their user base is using, which means MVNOs can still be very competitive with the average data prices I am seeing while negotiating MVNO agreements (at least the prices I have seen in the last 3-5 years) and/or ones that could be easily and quickly agreed with an MVNO if approached with a plan around social networking, rather than the usual "I need cheaper prices" routine :)

If you like this article, please like us on facebook/mvnos or follow us / +1 on Google+ and of course follow us on twitter @MVNO_ 

If you want to discuss how you can enable data revenues for your MVNO or MNO wholesale department then use the contactify link at the top right of this page and get in touch