Are you willing to offer mobile subscriptions to your current clients? Do you need a fleet of SIM cards for your connected objects?
If so, your project may require to create a mobile operator.
Firstly, note that there is a big difference between providing mobile subscriptions and becoming a mobile operator. You could provide a mobile offer overnight, if you accept that this offer will not be provided under your brand. You will simply be the reseller of an existing offer.
Nonetheless, if you want to offer a mobile subscription in your own name (and at your own pricing), it is not the same approach. To do so, you will need to become a mobile operator. Fortunately, creating a mobile operator has become very simple nowadays, thanks to the model called "MVNO".
Become an MVNO to offer a branded mobile offer.
"MVNO" stands for "Mobile Virtual Network Operator". The MVNO model is a form of partnership where major operators (such as EE, O2, Orange or T-mobile) enable other companies to become operators on their network. As you can guess, in the mobile value chain, the network of antennas is the key component. Of course, the huge investment represented by a network of radio antennas is obviously the main barrier to entry into the mobile market. And, somehow, it kept innovators away for a long time!
However, about fifteen years ago, the MVNO model has unlocked the access to the mobile network!
In an MVNO partnership, the operator owning the antennas allows a third-party company to operate SIM cards on its network.
Since then, this model has gradually developed across Europe. It quickly fostered the rise of significant mobile operators of all sizes: from Virgin Mobile (with millions of subscribers in the UK) to the smallest niche operators.
To better understand the mechanism of MVNOs, see our article on the matter.
How to become an MVNO?
Most of the time, national operators (such as BT, Telefonica or Orange) have delegated the creation of MVNOs to an intermediary, like Legos.
Instead of the aforementioned operator itself, it is this company that will allow you to become a mobile operator. Simply put: this partner, called an MVNE (for Enabler) will create your virtual network and will provide you with SIM cards to distribute to your customers. They can also help you to be legally declared as an operator.
The main advantage is that your are sailing your own ship! You can brand the network name, the web interfaces, the SIM cards, etc. But most of all, you will be able to set your own pricing and your own CRM mechanisms. You can create mobile offers with a given amount of calls, SMS and data. You will then set the price per SIM and the payment method (pre-paid / post-paid). In addition, your supplier will be able to support you on other topics: user interfaces, customer relationship tools, promotional tools, PBX...
A 5-step process
1- study your target:
You probably already know your target very well. However, have you assessed its “mobile consumption” yet? How many calls do your customers make per month (and for how long)? How many texts? And most importantly, how much data do they consume? These elements will be crucial in calculating your average cost per subscriber.
2- study your competition:
Since you cannot compete with the big players from day one, you will have to be smarter! At the early stages of your project, it is very likely that you will position on a niche market. To give you positioning ideas we have gathered a few examples in "Alt-mobile: 17 inspiring MVNOs".
Once you have defined your niche market, you will identify competitors more easily. Be it large or small operators, you will have to benchmark these competitors on the same key points: what is their range (internet, fixed, mobile...)? do they have any special offers? Do these promotions involve commitment periods? Do they make bundled offers (box, content, fixed phone, collaboration tools...)? Etc.
3 - build an offer:
From that point on, you will need an MVNE partner like Legos. This MVNE will allow you to configure your commercial offer: will it be pre-paid or post-paid? How much voice/SMS/data per subscription? Etc. In addition, this partner will help you to create your terms and conditions, so that you avoid some common legal "pitfalls".
4 – Being declared as an operator:
Each government keeps a close eye on its radio frequencies. Each of them have an agency overseeing the use of mobile networks. It is therefore preferable to be declared as an operator to become an MVNO. You can do it in your name or via your MVNE.
5- receive your SIM cards:
Once your offer has been configured (and the declaration is made), your MVNE will send you the SIM cards. You are ready to market your offer! Good luck!
Legos is an expert in creating mobile operators.
Tell us about your project or read our resources for mobile entrepreneurs.