The opening keynote of the MVNO Nation Africa event was delivered by Valde Ferradaz, CEO of MVNX. It set the scene well for the whole event, as it provided a breakdown of the current market, changing market trends, and key success factors for MVNOs moving into the future.
Current changing trends and market drivers
Valde began by identifying two significant trends that are driving change and influencing the market in Africa, and also globally, right
now.
1 – Regulatory changes
Valde explained, “Regulation has triggered an investment from the networks. Whether they’re MVNOfriendly or not, these different operators have to onboard wholesale to compete, and MVNOs in order to comply with the latest award of spectrum, which they bid for.”
Of course, regulation stipulates a lot of what MVNOs can and can’t do.
“For example, in the Middle East, the government limits people rolling out base stations, networks, infrastructure, and backhaul,” added Valde. “The rest need to compete at the wholesale level, and some people need to compete at the service provider level, so the
regulators control consumerism and the competition in the marketplace.”
“And we all know what’s happening in South Africa. We can see it happening in lots of different countries. In some parts of the world, the regulator is having an anti-MVNO effect, where they pull back some spectrum, and that kills
the MVNO market.”
2 – Technological advancements
Technology is the single biggest driver of change, in Valde’s view.
“If you haven’t got a good technology platform, you can’t compete, because you can no longer compete in telco only and survive. You’re trying to convert your services, and digitisation of your customers, which includes connectivity, and connectivity is no longer just mobile. Connectivity can be any carrier technology, such as fixed wireless, fibre, satellite technologies, and others.”
So, MVNOs should be thinking carrier-agnostic, product-agnostic, and MVNO-agnostic. On the technical side, that means your platform needs one view of the customer with multiple billing capabilities.
“If you’re stuck with a telco solution, you’re out of date,” said Valde. Mobile operators evolved a long time ago. They don’t compete in just telco alone anymore. They provide FinTech, value added services, rewards, and so on. So, if you’re only immersing
yourself into the telco game, you’re narrowing your opportunities to compete.”
How should MVNOs respond to this change?
The marketplace is changing because of these two factors. Valde believes that the marketplace is going to see increasing competition coming in, but that only makes the fundamentals more important for MVNOs.
“We see a lot of businesses now offering technology through mobile apps, web apps, API Interfaces, billing engines, and it’s causing confusion in the market, because there’s a lot of choice out there but not everyone does it well,” said Valde.
While the market has woken up to the opportunities, many still need help getting their strategy, decision making, and execution right.
“Today, almost any business can launch their own branded MVNO quickly. It’s not that expensive and, if you choose the right partner, it’s already integrated to multiple operators.”
“But getting it launched isn’t the hard part. The hard part is everything required for success, like your strategy, value proposition, brand differentiation, customer experience, technology, and everything else.”
Success factors for MVNOs amidst this change
So, in today’s market, what are those fundamental success factors for MVNOs?
1 – Commercial strategy
Valde believes that the strategy behind your business must be absolutely sound before you hope to grow and succeed. For example:
• Financial modelling
• A clear value proposition,
• An effective go-to-market plan
• Comprehensive customer value management.
2 – Technological flexibility
MVNOs should be looking for flexibility and the autonomy to make their own decisions. Aim to be entirely agnostic.
Valde said, “For example, we’re helping some of our clients with integration so they’re using fixed wireless from one operator, and mobile voice and data from another operator. You should find that flexibility, and not be tied to just one operator, so you’re not in the hands of whatever strategy your one operator is using.”
“You need to be able to offer all sorts of different products and services to attract and retain customers. Your technology platform should not limit you with those products and services.”
“This is just a personal view, but if you’re an MVNO without a technology system, so you integrate through an operator, that operator then controls your pricing, time-to-market of your products, any change requests, and any config. you need. You have zero
power in that scenario.”
“MVNOs should be carrier-agnostic, operator-agnostic, and productagnostic.”
3 – What is the optimal operator relationship?
“Don’t get me wrong. It can work,” added Valde. “It does work. But it’s important to understand operators have very different strategies. We work with all the operators, and some of them are really good, but they clearly have different strategies and agendas around the MVNO market.”
Valde broke this down as follows:
1. Some operators will want to grow market share by competing directly in the MVNO space, through partners, by themselves, and so on.
2. Some are very independent. They provide the network, the core, and MVNOs go to market, but they recommend two or three companies to work with.
3. Some are going to go completely in-house and just comply
4. And others will just tick the box from a regulatory perspective, and not be MVNO-friendly.
So, this is an important decision for MVNOs, which may often require the support of a partner or enabler to ensure the best fit from a business strategy perspective.
4 – Non-telco strategy driving telco growth
Valde also pointed to the trend of non-telco strategy driving telco growth.
Valde said, “For example, if a new MVNO is a big retailer, offering a credit card to customers, you can load that FinTech value on to the system that also does telco, then you can offer those customers a SIM with their credit card.”
“So, the growth of MVNOs is connecting all their value added services, rewards, and other products together to better capture and retain their customers.”
Additionally, aligned with this trend, eSIM is fast-becoming crucial to the digitisation process of MVNOs and their customer relationships.
5 – A simple approach
The MVNOs that think about this wider ecosystem, as a way to provide more value to their customers, are the ones that are successful today.
According to Valde, the leading MVNOs are:
• Keeping it simple
• Using value added services to build more trust
• Engaging customers across multiple touch-points
• Rewarding their customers to increase retention.
The value of a converged platform
The value of a converged customer management and billing platform is growing as this new model of MVNO gains momentum.
Gaining a single view of your customer across various different products and services creates the ability to better serve and nurture those customers.
Valde explained, “When you can see everything your customer is using with you in this one system, with intelligent analytics, you can decide what you offer the customer for free, and you’re making yourself more strong in terms of competition, so that customer
doesn’t want to churn.”
“Maximise the spend at the point of interaction with the best possible digital engagement, so that you can get your customers to stick.”
Key take-aways and guidance for MVNOs
Valde’s key take-aways and advice for MVNOs trying to navigate this fast-changing landscape, and continue to experience success in future, were:
• Remain agnostic and retain your flexibility and autonomy
• Find a partner who understands your vision and can help you with your strategy
• Your technology platform provider should have proven success and full capabilities
• Diversification of services, recurring usage, and pervasive customer engagement should be your priority.
