Future of Mobile Virtual Players is Bright in India, Provided Regulations at Place

By August 28th, 2014 AT 2:34 AM

In my last article I explained how Indian ventures via ‘PSEUDO-MVNO’ route failed to sustain. But in the changed situation in the telecom sector, which includes less competition, exit of most new operators, power to incumbents, standardized tariff regime, expansion of 3G coverage & hence more uptake, upcoming 4G based mobile broadband, aggressive growth of mobile internet in urban areas, interest in mobile internet in rural areas, gross difference between rural & urban teledensity and establishment of a new government believing in corporate work culture; the market can find a sustainable & profitable niché for mobile virtual network operators.

There are few steps are needed to boost this never-properly-explored segment of Indian telecom.

A Proper Rules & Regulations for MVNO in India:

Government of India is yet come up with a proper policy for MVNO. Once it comes, several companies from domestic & overseas market may be interested to enter in India via MVNO. But nobody knows when the final outcome would come in.
In 2009 TRAI sent some suggestions to DoT but ultimately DoT is yet to publish final draft. It was decided that 5 cr, 3 cr & 1cr will be the entry fee for category A, B & C type of circles respectively.

Existing Telecom Players must not worry

Existing players (Mobile Network Operator or MNO) may think about more competition but actually they may find more revenue earning routes due to MVNO in their network. Selling of huge amount of voice, text & data to MVNO at a wholesale rate will definitely make their revenue stream positive. MNO can be Mobile Virtual Network Enabler or MVNE for these virtual players. And most importantly Indian operators offer straight forward approach to the customers. MVNO can target specific user base segments. In short MVNO can help better utilization of resources & assured revenue for the companies.
Apart from the above mentioned criteria, a solid planning, marketing strategy & focus on a selected audience are required from the companies who are willing to enter the market.

Types of MVNO business models

There are several parameters which differentiate types of MVNO offering. In a broad way we can discuss types of MVNO under two headings.

Operational models

There are four operational models in general, which generally rules out the strict formula for MVNO. MVNO can be thin or thick layered. Thick MVNO means MVNO with all telecom assets except the spectrum while thin MVNOs have only marketing and sales.

mvno-indiaBusiness models & market approach

There are basically tons of business models for MVNO, say for eg – discount, media/entertainment, business focused, lifestyle, community focused, M2M, roaming, data/internet, brand, quad play etc. The business models can be different in India as here diversity of people is too much. It can be a challenge for the MVNOs in the country to find a target audience with proper service offerings to make a successful business model.

With the tremendous growth in the mobile internet sector in India, and upcoming 4G revolution MVNOs may find the data market with endless opportunities.

 Pseudo-MVNOs in India:

Companies who showed the interest to enter Indian telecom market as MVNO:Global roaming based MVNO players like Clay Telecom,Lyca Mobile and others, Indian ISPs like You Broadband and Cable,Tikona Broadband, entertainment companies likeBCCI orIPLT20 are really interested to beMVNO. The smaller players like MTS India,Telenor andVideocon can go pan India viaMVNO easily. Aditya Birla’s retails presence More can offer more-branded SIM cards via Idea, similarlyBharti Retail can sell its own SIM via Airtel. Few days back few media reports suggestWhatsApp is also waiting forMVNO policy in India.But most companies incl. telecom operators remaintight lipped as there is noMVNO policy. When sharing of spectrum will be allowed I think then Govt will definitely have to come out with aMVNO policy.

MNOMVNONotes
Tata Docomo CDMAVirgin Mobile CDMA (Virgin Mobile)First pseudo MVNO in India. Fails as it was CDMA.
Tata Docomo GSMVirgin Mobile GSM (Virgin Mobile)After CDMA did not gain momentum VMI intros GSM connections too. VMI GSM is still operating with moderate amount of userbase who use it for offer.
Tata Docomo GSMTalk24 (with Future Group)Acts as Future’s Retail customers’ loyality SIM card. Has more than 2.5+ million customers. Probably the most successful pseudo MVNO in India, thanks to Future Group’s pan India powerful retail existence.
MTS IndiaVodafone NetCruiseOnly EvDO Rev A based data cards. No separate data available.
AircelBlykLaunched in 2010, Blyk operates as Ad based free/discounted service provider. Lukewarm response and still operating.
AircelSimpossibleStarted in May, 2013 in Andra & Karnataka. Did not get much traction from them or Aircel. Now totally silent.

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