3G Expected To Encourage Growth Of Virtual Mobile Operators

The added capacity of 3G means that 'virtual' operators appealing to specific market niches and using the networks of established carriers will flourish.

June 7, 2005

1 Min Read
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Widespread deployment of 3G cellular data services will spur an increasing number of mobile virtual network operators (MVNOs) that sell wireless services but don't have their own networks, a study released Tuesday by U.K. research firm Analysys claims.

Instead of building out their own networks, MVNOs use the services of already-established wireless operators. For example, in the U.S., sports cable network ESPN is creating an MVNO and is using Sprint's network.

MVNOs are already having an impact on the industry in developed nations, according to the study. For instance, there are more than 100 MVNOs in Western Europe and 25 are either in operation in the U.S. or will be soon.

"MVNOs have acquired nearly a quarter of all mobile users in Denmark," Mark Heath, co-author of the report, said in a statement. "In the UK, Virgin Mobile has propelled T-Mobile from last to first place in terms of market share by customer numbers, while in the USA, Sprint PCS hosts more than 15 MVNOs."

Capacity limits imposed by older wireless systems meant that MVNOs couldn't grow rapidly. However, the greater capacity and data rates of 3G mean that those limits will no longer hamper creation of new MVNOs.MVNOs typically target specific markets such as low-income users or those interested in specific types of information or entertainment, such as ESPN's offering, the study notes.

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