Oct 2009: Helping MVNOs get their profit margins right

While lean times may be hitting many people’s pockets around the world, the truth is that they’ll still need to make telephone calls and, increasingly, use messaging and data services to stay in touch with friends and communities. As mobile network owners large and small struggle to remain profitable, they’re increasingly coming to realise that opening up their networks to third parties - the Mobile Virtual Network Operators (MVNOs) - can add up to a win-win situation for all concerned.

In the UK alone there are now more than 15 MVNOs with, interestingly, some of the most successful service providers specifically targeting ethnic groups in their marketing and service support strategies. Given the continuing trend towards increased global mobility - for work, migration, study or just tourism - these MVNOs are able to exploit the increasingly narrow profit margins that affect the whole industry by operating lean, technologically efficient and highly focused operations that are marketed from the street or community upwards level.

For the network owners - such as Vodafone and Orange in the UK, the last supporting - partnering with the right type of MVNO is an attractive proposition. They get additional traffic and revenues coming to their networks, while the actual leg work of getting customers is carried out by the MVNO themselves. The key issue however for both of these parties is how they manage their relationships, who does what and where the boundaries of control exactly lie.

Of particular importance - especially for the MVNO - are the platforms and techniques they use to manage their customers and their revenues. Given the price sensitivity of their particular marketplace, it’s essential that they have as much control and flexibility as possible to be able to respond quickly to changes in market conditions or exploit particular seasonal or regional opportunities as they occur. On top of this, they also need to be acutely aware of the dangers of fraud - always a threat with a highly distributed route to market - and be able to respond rapidly to first identify and then halt any exploitation of inherent loopholes.

In this context, having the ability to easily manage the technical environment involved in account authorisation and roaming - specifically DIAMETER and CAMEL technologies - means that the MVNO can stay very much in control of their own operational and financial destinies. Additionally, they also need to be able to extend a large degree of control to their own customers, utilising real time reporting and marketing info, web interfaces and other tools to give them much greater flexibility to set their own tariff packages and service preferences as their own personal conditions change.

This is an issue that DIGITALK has long understood well and, as a result, provides exactly these kinds of functionalities in its platforms. Using standard industry, ETSI/ITU and 3GPP interfaces to billing, rating and e-payment systems - along with a highly flexible solution for real time reporting and web-enabled self-care - several MVNOs around the world are now using DIGITALK systems to drive both their revenues and customer loyalty. Our innovative support for this part of the industry has just been recognised with an Excellence Award from INTERNET TELEPHONY magazine specifically for our MVNO Prepaid Mobile solution.

Justin Norris
Chief Executive Officer