What Is a Mobile Virtual Network Operator (MVNO) and How It Drives Value

A mobile virtual network operator (MVNO) is a wireless service provider that doesn’t own the infrastructure it uses. Instead, the MVNO buys network capacity from existing mobile network operators (MNOs). This is a mutually beneficial process for both MVNOs and MNOs, while also creating new channels for customers.

What is a Mobile Virtual Network Operator (MVNO) and How Does it Drive Value

Three reasons why MVNOs bring value

There are many opportunities for service providers to become MVNOs, especially when using advanced platforms like VoipNow. In today’s article, we’ll learn more about MVNOs and the value they bring to the communications ecosystem. Let’s go!

MVNOs allow brands to enter the mobile market

The main benefit is the opportunity for service providers to enter this niche on the communications market without a significant investment.

By using existing MNO infrastructure, MVNOs can start working with customers immediately. They don’t have to worry about establishing a large and reliable network. They don’t have to invest in hardware or spectrum licensing. Their main focus is on acquiring clients and growing their profits. Which basically means their duties fall more on the business side of things.

MVNOs provide revenue streams to MNOs

A common question is why would MNOs allow MVNOs to use their infrastructure. However, there are multiple reasons why MVNOs are profitable to existing mobile networks.

First, MVNOs provide additional revenue streams to existing networks. The network already has the infrastructure. Why wouldn’t it accept others to use the network against a fee?

Think of MVNOs as tenants and MNOs as renters. If a person owns a house and has 2 spare rooms, they still have to pay for the mortgage, electricity, landscaping, and repairs. However, when they rent out each room to a tenant and collect payment each month, the homeowner has two income streams to cover these costs. The same concept applies in our case.

Furthermore, if an MNO loses customers unexpectedly, it can continue to pull revenue from the MVNO. Additionally, they can use the MVNO income to improve the existing infrastructure, creating a better experience for all customers involved.

Increased competition is good for customers

Customers are the third-party beneficiary of MVNO development. Most customers don’t know that the MVNO they choose for their service provider is actually powered by a larger MNO. Some MVNOs will advertise the network that their service is powered by, but not all customers will pick up on this connection.

The main benefit of MVNOs to customers is increased competition in the market. As of 2021, there are three major players in the United States wireless carrier market. AT&T has 44 percent of the market share, Verizon has close to 30 percent, and T-Mobile has 25 percent. What is a consumer supposed to do if they don’t want to work with these three companies but still needs a reliable mobile network operator?

MVNOs increase the number of service providers. They often provide competitive rates or discounts and they create additional value through the other advanced PBX services they provide. This creates market competition and makes people feel like they have more choices in the network provider they go with.

Use case: Use VoipNow to be an MVNO

Our team has worked with many service provider partners to help them configure their VoipNow infrastructure and become MVNOs. This way, they can deliver business telephony services through both fixed and mobile lines.

Here’s a way to do this with VoipNow.

A mapping server connects to the GSM server on one side and with a VoipNow infrastructure on the other. The GSM DID (the mobile number) is mapped into a VoipNow extension.

Next, the call gets initiated through a SIP channel. This is either a GSM call, when it’s terminated through the GSM provider, or a VoIP call, when it goes through the SIP providers.

With such a setup, our providers deliver a smooth call experience for their business customers. This way, their customers make the best out of both worlds while enjoying enterprise-level communication and collaboration services.

Become an MVNO now!

Competition and diversity are beneficial in almost any field. They open up opportunities for customers while encouraging companies to provide the best services possible. The same applies to the development of mobile virtual network providers that use existing networks.

MVNOs create revenue streams for MNOs and market diversity for customers. They are valuable for the companies that establish them, along with the vendors and clients they work with. Through MNVOs, the mobile network field is stronger and better.

What’s more, by delivering more services on top of their current communications offering, MVNOs are able to upsell to existing customers, improve their stickiness factor, and gain new customers.

Becoming a MVNO and delivering mobile lines on top of business communication and team collaboration services to your customers has never been easier. Contact the 4PSA sales team today and let’s get you started!

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