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Monday, March 26, 2007

BT - building a patchwork of MVNO deals?

Interesting to see that BT has persuaded Vodafone Spain to allow it to become an MVNO. The Spanish regulator CMT has been forcing the market to accept MVNOs over the last year or so, and there is a long queue of operators wanting to launch services, including Carphone Warehouse and KPN. BT's service however, is aimed firmly at "businesses and the public sector" - a very wise move in my view, as there are remarkably few operators that are able to grasp both mobility and the practical realities of corporate networked IT. I've talked before about the opportunity for enterprise MVNOs, and I'm surprised there hasn't been more movement in this field to date.

The fact that BT is working with Voda again is highly significant. The UK MVNO deal raised eyebrows at the time - including quite a few inside Vodafone itself. I remember being at the original launch of Fusion, and there seemed to be an underlying attitude among the lines of "it'll never work, so what have we got to lose?". I think it's actually quite a wise move - there's clearly a demand for some hardcore PBX-centric bits of FMC, and other top-end international IT outsourcing-style comms services, that Vodafone isn't really positioned to service but BT is. Wholesaling - especially if it's done in multiple markets with similar technical architecture - offers Voda a hedge against limits to mobile substitution in the enterprise.


Anonymous said...

theres a very good reason there are no enterprise MVNOs: there's absolutely no margin it at all. NONE. By any calculation method you care to use. And i mean a real calculation, not the back-of-a-stamp doodle analysts are so fond of.

i assume you have an amazing solution for this given all your years of experience in the acronym industry? because of course NONE of the operators have looked at enterprise MVNOs and tried to see if it would work....

Dean Bubley said...

No margin for whom, and doing what? For the host operator, or for the MVNO itself?

And you're assuming that the MVNO isn't just using mobile services as a necessary piece of a larger puzzle, such as an overall telephony managed service offering, or something related to telematics?

There are a few business MVNOs, as well as a variety of other wholesalers. Timico is a small one in the UK, and I believe that Teleware/PMN has (or is seeking) an outdoor MVNO deal alongside its low-power GSM indoor licence for corporate customers. I'd expect Colt and C&W to follow suit, if they can get a host operator to support them.

BT is intending to use its MVNO deals along with Corporate Fusion and other Global Services offers.

And at an MVNO conference I attended a while back, Swedish VC Brainheart said they'd raised $200m specifically to fund startups in the area.

Given there's "absolutely no margin" for a whole bunch of consumer MVNOs that have failed, I don't expect all enterprise focused ones to succeed either, but I certainly reckon that various players - especially fixed-line corporate telco's and system integrators - should have a decent shot. Not so sure about SME-oriented ones, I'll agree, though.