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Mobile Virtual Network Operators (MVNO) to Gain Ground Through Greater Bandwidth Leasing by MNOs, reports TMR

Posted on Feb 22, 2016

Tier I mobile virtual network operators in the world in 2015 were Virgin, AT&T, and Verizon. Each of these top tier companies has had their share of mergers and acquisitions on a global scale. 

As stated by Transparency Market Research in its recent publication on MVNOs, a large number of vendors are looking towards solidifying their standing in the global market through mutual agreements and partnerships. Key vendors have been at the forefront of adopting cutting-edge technologies at competitive pricing.

The global market for mobile virtual network operators is expected to reach US$75.25 bn by 2023. This is possible through a consistent projection of the markets CAGR at 7.4% from 2015 to 2023, on the basis of revenue. This revenue is projected to achieve a revenue of US$45.86 bn by the end of 2016.

Full MVNO operational models are expected to be not only the leading segment till 2023, but also the segment with the leading CAGR from 2015 to 2023. By the end of 2023, this operational segment is expected to reach US$48.62 bn in revenue.

Consumer-based subscribers are expected to retain their lead over business subscribers till 2023. By the end of 2023, consumer subscribers are expected to generate US$66.62 bn of the total market revenue. Meanwhile, owing to the implementation of low cost and large-scale professional applications and communication portals, business subscribers are leading in terms of growth rate between 2015 and 2023.

Europe to Retain Leading Regional Share in MVNOs

By the end of 2023, Europe is expected to generate a revenue of US$28.90 bn in the global mobile virtual network operator market. This is attributed to the high level of support shown by governments and concerned regional bodies such as the European Commission. They have enabled many large-scale implementations of MVNOs, and MNO and MVNO mergers.

Meanwhile, Latin America is showing a massive CAGR of 10.4% from 2015 to 2023 owing to a very high demand for mobile virtual networks in the region. North America is expected to continue being in the second place in terms of MVNO demand, but shows a very open ground for large-scale implementation on high-speed networks.

MNOs Leasing Network to MVNOs at a Greater Scale Globally

“At the moment, mobile virtual network operators hold a great advantage that comes from the mobile network operators themselves. MNOs can rent parts of their bandwidth to MVNOs that are otherwise unused, especially in 3G networks across developed economies. This allows MVNOs to provide cost-effective services to their virtual customers, and MNOs get a large usage volume and profit through the MVNOs,” states a TMR analyst. This is expected to drive the global market for mobile virtual network operators over the immediate future, but provide a lesser impetus in the long term.

ARPU May Reduce as Competition Intensifies

The average revenue per user that MVNOs are earning has a good chance of reducing over time, as a greater number of mobile virtual network operators enter the market and competition grows stronger. Over the recent past, MVNOs have only been prominent in about one-third of the globe, in developed economies. These regions are already saturated with MVNOs and their market penetration was equally high. But the incoming number of new entrants could create pricing complications for all existing players in a market where service differentiations is already a challenge. For instance, the ARPU among MVNOs in Europe had already fallen by 7% per year from 2011 to 2014.

“To make the most of the booming demand for MVNs, operators can set shop in the largely untapped regions in Latin America and Asia Pacific. Latin America, especially, shows a strong promise of demand in the coming years, and players can certainly achieve progress by penetrating these regions,” adds the analyst.

The information presented in this review is based on a Transparency Market Research report, titled, “Mobile Virtual Network Operator (MVNO) Market - Global Industry Analysis, Size, Share, Growth, Trends and Forecast 2015 - 2023.

Key Takeaways:

  • Full MVNOs expected to achieve US$48.64 bn in revenue by 2023.
  • Discount type MVNOs to continue lead in MVNO types, expected to generate US$20.45 bn by 2023.
  • Consumer-based MVNO subscribers expected to generate US$66.63 bn by 2023.

Key segments of the Global Mobile Virtual Network Operator (MVNO) Market

By Operational Model

  • Reseller MVNO
  • Service Operator MVNO
  • Full-MVNO

By Industry Vertical

  • Business
  • Discount
  • M2M
  • Media
  • Migrant
  • Retail
  • Roaming
  • Telecom

By Subscriber

  • Consumer
  • Business

By Geography

  • North America
  • Europe
  • Latin America
  • APAC
  • Middle East and Africa

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