Sixteen paths to mobile enlightenment…

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It used to be that operators came in clearly-defined categories, as different from one another as reptiles are from mammals. Fixed operators had fixed lines and telephone exchanges and sold fixed line telephone services. Mobile operators had spectrum and base stations and sold mobile telephony. Cable operators had coaxial cables and sold television services. Then mobile operators started selling wholesale minutes to other operators, who sold them on to end customers under a different brand and the MVNO was born. Mobile minutes started to displace fixed-line minutes, so fixed line operators became MVNOs, adding mobile services to  bundles of television and broadband services. More recently, operators have started to outsource their network operations and to share their networks with other operators, so that even ‘real’ mobile operators may no longer own the network they use to deliver services.

This led us to wondering how many different ways operators could deliver mobile services, and whether all of those ways had been properly identified and investigated. Clearly there are some essential assets which are needed to deliver a service and any aspiring operator must somehow gain access to a complete set of those assets. These could be characterised in various ways, but we think a helpful approach is to consider the following four essential ingredients:

  • Spectrum: Spectrum licences which permit mobile services in bands where mobiles are widely available must be available in order to deliver a viable service.
  • Sites: In order to deliver a mobile service which provides coverage, wide area mobility and a large amount of capacity, mobile operators need a portfolio of sites in appropriate locations and with associated rights to deploy base station equipment.
  • Network: The mobile network itself is clearly an essential ingredient, composed of radio, transport and core elements.
  • Customers: It may seem obvious, but a large and willing customer base has to be available – although the relationship with those customers may not necessarily be direct with the mobile operator, as in the case of MVNOs.

So any organisation with at least one of these four essential elements can play a role in delivering mobile services. Traditionally, all of these needed to be associated with the one mobile operator, but actually recent history has demonstrated that these can be distributed between different organisations, so long as the ‘joins’ between the different elements are sufficiently seamless that the customers ultimately get a good service.

Provided a given organisation has at least one of these four elements, they have a potential role in delivering a mobile service. In fact a mobile apps developer could even deliver a service without any of these elements, resulting in the 16 different players illustrated in Table 1. This includes organisations such as spectrum band managers who may not actively run any part of a service, but have an asset (a spectrum licence) which they can make available to another operator under suitable terms. It’s interesting to note that examples of many of these are hard to come by: does this mean there is no value in such an offering, or just that no-one has thought to offer it?

Table 1: 16 forms of operator
 
Sixteen Types of Operator

 

 

Of course, all of these players (with the exception of the conventional vertically integrated operator – #1 in the table) need to form partnerships with others in order for a complete service to be delivered. Figure 2 shows what we think is the complete set of viable combinations.

Figure 2: Viable combinations for delivering a full service

 

Complementary Combinations

The first combination – a wholesale operator with an MVNO – is well known. Some of the others seem outlandish today, e.g. a site provider with a band manager, a network -only operator and an MVNO. However, the concept of multiple operators sharing the same network and then outsourcing it all to a third party would have seemed like a flight of fancy just a few years ago…

The practical significance of all this is of course that there may be more ways to compete in the mobile market than might at first be apparent and indeed that there  might be ways to deliver niche mobile services – such as those for limited customer segments or geographical areas – with a lower barrier to entry than traditionally imagined.

We’d love to hear your views, and particularly real examples of these potential patchwork mobile service partnerships around the world.

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