BOSTON—The U.S. mobile virtual network operator market continues to take hits from naysayers who believe the segment isn’t living up to its hype.
The latest blow comes from research firm Strategy Analytics, which predicts the majority of MVNOs will fail to make an impact on the marketplace. In its latest MVNO report, Strategy Analytics said much-hyped new MVNOs like Helio L.L.C. and Mobile ESPN L.L.C. have attracted “miniscule customer numbers” while prepaid and youth-focused MVNO offerings like Tracfone Wireless Inc., Virgin Mobile USA L.L.C. and Boost Mobile L.L.C. have established a comfortable niche.
“The new wave of MVNOs has failed to learn lessons from its predecessors,” said Sara Harris, senior industry analyst at Strategy Analytics. “The handsets are boring, pricing uninspired and the distribution strategy is flawed. This is a three-fold recipe for failure.”
Strategy Analytics estimates that Tracfone, Virgin Mobile USA and Boost accounted for 65 percent of the U.S. MVNO market last year.
