5 MVNO challenges for UK brands (and how to overcome them)

Brands are actively seeking innovative methods to boost customer engagement, foster loyalty, and generate new income. Launching a UK Mobile Virtual Network Operator (MVNO) has become a compelling tactic to achieve these aims. Entering the telecommunications industry, however, presents unique obstacles. Here are five key hurdles brands face when establishing an MVNO, along with solutions:

• Finding the right MVNE partner
• Protecting and extending your brand via new UK MVNO services
• Achieving rapid activation of UK MVNO services
• Navigating regulatory and compliance fundamentals
• Executing a successful UK MVNO go-to-market

The challenge: Selecting the right Mobile Virtual Network Enabler (MVNE) is crucial. The wrong partner can lead to technical difficulties, operational inefficiencies, and increased costs. Brands need an MVNE that offers a "plug-and-play" solution with robust support, seamless integration, and full MVNO capabilities.

Overcoming it:

• Due diligence: Thoroughly research potential MVNE partners. Look for experience, client testimonials, and a track record of successful MVNO launches. Consider their platform's flexibility, scalability, and integration capabilities.
• Full MVNO capabilities: Opt for an MVNE that offers full MVNO capabilities rather than just reseller models. This ensures more control over branding, pricing, and customer experience.
• Plug-and-play solutions: Choose a partner that provides a comprehensive, ready-to-launch package, handling network integration, billing, customer support, and compliance. This minimizes upfront investment and accelerates time to market.
• Transparency & control: Ensure the MVNE provides good visibility of operations, allows full control over your data and commercial opportunities.

Cost considerations:

• Avoid hidden costs: Clarify all potential costs upfront, including support fees, integration costs, and any additional charges for specific features or integrations.
• Check for any MVNE fees: These may vary based on the chosen partner and the level of service. "Plug-and-play" solutions often come with packaged pricing, which can include setup fees, platform access fees, and per-user charges – or the costs may be partly or fully absorbed into the margin model.
• Scrutinise cost scalability and flexibility: Look for flexible pricing models that scale with your growth, such as revenue-sharing arrangements or pay-as-you-go models.

In summary:

Grapple with the mechanics of becoming an MVNO to find the right MVNO partner. Partnering with an MVNE involves leveraging their platform and infrastructure. The MVNE handles the complex network integrations with Mobile Network Operators (MNOs), billing systems, and customer support, allowing brands to focus on their unique offerings.

The challenge: Launching an MVNO means extending your brand into a new kind of service with high user expectations. Maintaining brand integrity and ensuring a seamless customer experience across mobile services is vital. There's a risk of diluting brand value if the mobile service quality or customer support falls short.

Overcoming it:

• Control the customer journey: Choose an MVNE partner that allows you to maintain full control over the customer journey, from onboarding to ongoing support; augmenting this with existing digital journeys for a seamless brand CX.
• Brand alignment: Ensure all aspects of the MVNO service, including billing, customer support, and digital interfaces, align with your brand's voice, tone, and values.
• Data & insights: Leverage data insights to personalize customer experiences and tailor offers, enhancing customer satisfaction and reinforcing brand loyalty. The process of obtaining, analysing, and applying these insights can be fully automated.
• Safeguarding brand CX: Consider that high quality, AI-driven customer service and support is of paramount importance to overall CX, and therefore, protection and strengthening of your brand.

Cost considerations:

• Branding investment: Allocating budget for branding, marketing, and creating new customer touchpoints – e.g. designing a dedicated app, customizing billing interfaces, and training support staff – may be necessary, or could be avoided with a smarter approach using existing touchpoints, facilitated by the right MVNE partner choice.
• Customer support costs: Similarly, providing high-quality customer support may require investment in training, tools, and potentially additional staffing, especially in the initial stages of launch – it depends on how support triage and escalation is managed with the MVNE.
• Data analytics tools: Investing in data analytics platforms and expertise may be necessary to effectively utilize customer insights and personalize offers – or could be included in the MVNE wrap.

In summary:

You shouldn’t need telco experience to optimise the user experience. Protect your brand by remaining user-focused at all times. While you don't need extensive in-house telco experience, it’s highly beneficial having a mindset to engage with the right MVNE partner and collaborate in pursuit of a clear strategy to prioritise the customer experience.

The challenge: Lengthy activation timelines dampen commercial opportunity and early-mover advantage, frustrating customers and negatively impact the brand experience. In today's digital-first world, customers expect instant access and seamless onboarding. Likewise, launching an MVNO proposition should be an accelerated process with minimum barriers.

Overcoming it:

• Automated processes: Partner with an MVNE that offers fully automated, end-to-end customer lifecycle processes, ensuring rapid provisioning and activation.
• Cloud-based platforms: Utilize cloud infrastructure for scalable, flexible, and cost-efficient solutions, facilitating rapid service deployment and integration.
• eSIM technology: Embrace eSIM technology to eliminate the need for physical SIM cards, enabling instant digital activation through QR codes or app-based journeys – and eliminating SIM card logistics and associated costs.

Cost considerations:

• eSIM integration: If you’re left integrating eSIM capabilities into your systems then this may involve initial development or integration fees.
• Automation tools: Similarly, your MVNE may leave it to you to invest in the necessary automation tools and platforms for provisioning and customer lifecycle management – meaning upfront and ongoing costs.
• Cloud infrastructure costs: Cloud-based platforms have subscription fees that vary based on usage and features. However, these costs are often offset by reduced infrastructure and maintenance expenses.

In summary:

Demand to know how long it should take for your unique MVNO opportunity to achieve operational, commercial, technical and regulatory readiness. With the right MVNE and eSIM technology, activation can be remarkably fast. The overall launch timeline depends on regulatory approvals and internal setup, but "plug-and-play" solutions aim to significantly reduce time to market.

The challenge: The UK telecommunications industry is regulated by Ofcom, which sets rules for network access, pricing, and customer protection. Ensuring compliance with Ofcom’s General Conditions of Entitlement is essential for MVNOs.

Overcoming it:

• MVNE expertise: Choose an MVNE partner with deep knowledge of UK regulatory requirements and experience in navigating the Ofcom framework.
• Regulatory support: Look for MVNEs that stay up-to-date with regulatory changes and provide support for matters such as service accessibility.
• Number portability & transparency: Ensure your MVNE handles number portability and offers transparent pricing, as required by Ofcom.

Cost considerations:

• Compliance consulting: If necessary, engaging regulatory consultants or legal experts to ensure compliance with Ofcom regulations can incur additional costs.
• Regulatory fees: There may be regulatory fees or charges associated with obtaining licenses or approvals, depending on the specific requirements and the chosen MVNE model.
• Ongoing monitoring and updates: Depending on the chosen approach, it may be necessary to budget for ongoing monitoring of regulatory changes and updates to systems or processes in order to maintain compliance.

In summary:

More MVNOs is what regulators want, as is encouraging you to achieve compliance. Ofcom regulatory requirements are your responsibility, so get acquainted: Compliance prevents anti-competitive behavior and protects consumers – and the requirements are achievable for non-telco brands. These include, but are not limited to, transparency, accessibility, quality standards, switching and porting, etc. For more information, read up on your responsibilities on Ofcom's website.

The challenge: Launching a successful MVNO proposition to existing and/or new subscribers requires a well-defined go-to-market strategy to attract customers and differentiate your offering. Without proper planning, it's easy to get lost in a crowded market.

Overcoming it:

• Define strategic goals: Determine whether your goal is loyalty, revenue, data insights, or a combination of these.
• Identify target audience: Clearly define your target audience and tailor your services and marketing efforts to their needs and preferences. Segmentation of existing customer cohorts will be a key step.
• Value proposition: Develop a unique value proposition, such as bundling mobile services with existing offerings, exclusive benefits, or mission-driven tariffs.
• Marketing & promotion: Utilize digital marketing channels and your existing customer base to promote your MVNO services.
• Flexible commercial models: Partner with an MVNE offering flexible pricing structures and modular service packages to reduce financial risks and allow for growth.

Cost considerations:

• Marketing budget: Allocate an appropriate budget for marketing and promotional activities, including digital advertising, content creation, and social media campaigns.
• Customer acquisition costs (CAC): Calculate the estimated cost of acquiring each customer and factor this into your pricing and financial projections.
• Target upselling and long-term customer retention: Model the impact upon your chosen strategic goals of converting existing customers to the new mobile service, plus additional upselling and long-term retention.

Launching an MVNO is a strategic move that can significantly enhance brand engagement, drive revenue, and deepen customer loyalty. By carefully selecting the right MVNE partner, leveraging eSIM technology, understanding regulatory requirements, and developing a solid go-to-market strategy, brands can overcome the challenges and successfully own the connection with their customers.

The future of MVNOs is bright, especially for brands with the vision and willingness to meet customers where they are – on mobile.

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