Want to become a MVNO?

For a company planning to become a mobile operator, two alternative ways to enter the market exist. In addition to the traditional way of acquiring a spectrum license and building a mobile network, market entrance is also possible by becoming a virtual operator and utilizing the existing networks of incumbent operators.

Potentially, virtual operators will have an important role in shaping the mobile market structure and competition. In these type of projects, we normally advise our client with techno-economic modelling methods, used to analyze the position of a potential virtual operator in the mobile market industry subject of the advisory work.

Four alternative virtual operator scenarios are mainly analyzed using a linear, deterministic, and quantitative techno-economic model. The results highlight the importance of wholesale contracts with incumbent mobile network operators in determining the virtual operators’ business profitability. Unbalance in termination prices between fixed and mobile networks is shown to give incentives for virtual operators to invest in their own network infrastructure.

So, case you have to develop a MVNO business case as we are actually doing in several Eastern European countries, define the appropriate service sets, and take into account demand scenarios established within the project, focusing on developing a techno-economic model, evaluating tariff structures to be applied to compute the key economic indicators, Net Present Value (NPV), Internal Rate of Return (IRR) and payback period.

Have a nice weekend. CVA

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