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3G fears push operators to consider MVNO model

OXFORD, United Kingdom-As operators in Scandinavia call for a relaxation of 3G license conditions or opt to share the cost of network deployment, the concept of the mobile virtual network operator (MVNO) business model has come back into sharp focus. New findings from the market research firm Tarifica claim that many European cell-phone operators are, or have plans in place, to share their networks with other firms.

According to Tarifica, of the 12 European operators polled, five already sell airtime to an MVNO and of the remaining seven, six are contemplating doing so. One of these operators admitted that on average 10 percent of its overall revenue is generated from the MVNO it hosts on its network.

All operators agree that wholesale will play an increasingly important part in the mobile value chain, claimed Tarifica, certainly with the introduction of General Packet Radio Service (GPRS) and third-generation (3G) services. According to Dutchtone, wholesale is even now an essential part of a mobile operator’s business, and Netherlands-based Ben foresees that its wholesale business will account for up to 40 percent of its overall revenue within the next five years.

However, the Tarifica study discovered that only a handful of operators had dedicated wholesale departments within their organizations, and a significant minority still have a “let them come to us” mentality as far as wholesale is concerned.


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