The enablers

The market opportunity for mobile virtual network enablers (MVNEs) explored.

With Guy Zibi, director of EMEA, Pyramid Research (www.pyr.com).

Question: I've heard of mobile virtual network operators. But what are mobile virtual network enablers?

Zibi: The definition MVNE is a company that uses its own in-house solutions and combines those in partnerships with third party suppliers to enable services to companies that would like to become MVNOs. The most well known are Visage Mobile and Spinbox in Europe and Ztar in the USA. An MVNE will essential take care of all the facets of the set up and operation of the network, all the business things that will be required from managing the relationship with the network carrier. One point of contact that will take care of managing everything. The company can get to market faster and at lower cost.


Question: How good a market opportunity is this?

Zibi: In the report we actual expressed some level of caution. It is in a growing phase right now. The attractiveness of MVNOs is driving this. All companies looking to become MVNOs has driven demand for the services of MVNE. Ultimately there are a number of things taking place here. One is MVNO business model itself is some businesses cases fairly tenuous, so to speak. What that means in practice forward is that some MVNOs will either get out of business or companies considering the model not move forward. So obviously if that happens the demand for MNVEs goes down. The second point is what will differentiate them is the type of experience that they bring to their customers. Many MVNEs are aggregator of multiple services offered by a lot of third party supplies. They don't have a lot of intrinsic experience. MVNE need internal experience that can complement the third party company's expertise.


Question: What does the MVNE model look like going forward?

Zibi: It's less strength of the model than it is the size of the opportunity. The size MVNE is certainly larger in Western Europe because the market in there is more favorable to emergence of fairly small niche MVNOs. The US market is different in the sense that because mobile operators are fairly controlling of the type of MVNO that they let onto their network, the very small niche MVNO has not quite emerged yet. There is a market in US, but the level of expertise necessary is substantial higher than in Europe.

This 3 Questions originally appeared in a weekly report from IT Business Edge.

This was first published in September 2006

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