How Many MVNOs Are Too Many?

from the getcher-phones-now dept

It shouldn't come as a surprise to, well, anyone, that ESPN is launching an MVNO. The plans for just such an offering were discussed a year and a half ago, and there has been plenty of talk about the offering since that first story came out. It also shouldn't surprise anyone that Sprint is providing the network, as Sprint is increasingly becoming the NO everyone goes to in the US for their MVNO. What's interesting, however, is the question of how many mobile operators are needed -- whether virtual or not. Part of the reason why everyone was expecting mergers along the lines of Cingular/AT&T Wireless was that there were "too many operators" out there, meaning no one could profit. Does that situation change when the operator goes virtual? Actually, it does. Since Sprint is already running the network and a bunch of other MVNOs, the incremental costs for offering another one isn't that big a deal. Meanwhile, the MVNO company (in this case, Disney/ESPN) doesn't have to bother with the network costs at all. What's going to be tricky, however, is convincing people that they actually want to buy a phone from ESPN -- not a brand most people associate with mobile phones. With all this MVNO niche targeting, however, there are some risks that Sprint may be put in a tough position of competing against their own customers. Will Sprint be happy if they're losing customers to their MVNO partners? They still get money (so it's better than losing them to Cingular/Verizon/whoever), but it may present some difficult choices for Sprint and their MVNO partners.

Reader Comments (rss)

(Flattened / Threaded)

  1. identicon
    VonSkippy, Dec 1st, 2004 @ 2:32pm

    Craptastic Job of Writing Article

    What are MVNO's?????

    reply to this | link to this | view in thread ]

  2. icon
    Mike (profile), Dec 1st, 2004 @ 4:03pm

    Re: Craptastic Job of Writing Article

    Mobile Virtual Network Operator.

    Sorry. We've covered the space enough at this stage that I assumed people were familiar with it. Apparently, I was wrong.

    reply to this | link to this | view in thread ]

  3. identicon
    VonSkippy, Dec 1st, 2004 @ 4:45pm

    Re: Craptastic Job of Writing Article

    Never assume people can't be even more dumber (or unaware) then you can imagine. Thanks for the definition.

    reply to this | link to this | view in thread ]

  4. identicon
    DV Henkel-Wallace, Dec 1st, 2004 @ 6:34pm

    Just branding

    It's like sports team credit cards or airline cobranded credit cards etc. Essentially the market can likely tolerate an infinite number of them, especially with mobile number portability.

    In fact you'll likely flash your affinity-cobranded telephone around more in public than you'll flash your cobranded credit card!

    reply to this | link to this | view in thread ]

  5. identicon
    euman, Dec 2nd, 2004 @ 2:20am

    Re: Craptastic Job of Writing Article

    Never heard the term used before ever.

    reply to this | link to this | view in thread ]

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