MVNO Types & Operational Models

A Full MVNO represents the highest level of independence and control for a virtual operator. It is responsible for the entire operation, including customers and data, giving it complete authority over the services and products it offers. While it still leases access to the radio access network (RAN) and spectrum from a host MNO, it owns and operates its own core network infrastructure.

Significant Advantages:

Complete Control: Full MVNOs have full control over their own SIM cards, numbering ranges, Home Location Register (HLR), Gateway GPRS Support Node (GGSN), Short Message Service Centre (SMSC), Multimedia Messaging Service Centre (MMSC), and Gateway Mobile Switching Centre (GMSC).

Independent Roaming and Interconnect: They can negotiate their own roaming and interconnect agreements with other mobile network operators.

Customer Ownership and Customization: Full MVNOs have complete customer ownership and relationship management, allowing them to set their own tariff bundles and packages independently and gain deep insights into customer data for tailored services.

Differentiation and Flexibility: This level of integration provides greater flexibility in designing and deploying new services, offering significant opportunities for differentiation, segmentation, and fostering customer loyalty.

Significant Disadvantages:

High Costs: There are heavy OPEX and CAPEX costs associated with the extensive IT platforms and core network elements required.

Telecom Expertise: Operating as a Full MVNO demands a significant level of telecommunications know-how and understanding.

A Full MVNO can own and operate a wide range of core network elements, which provides significant advantages in terms of control, flexibility, and service differentiation. These elements include:

Mobile Switching Center (MSC): Controls call routing and generates usage information, allowing for independent wholesale relationships for voice/SMS routing.

Serving GPRS Support Node (SGSN): Handles packet-switched data, mobility management, authentication, and charging functions.

Gateway GPRS Support Node (GGSN): Manages subscriber access to the internet network, enables mapping and internet gateways, and allows for monitoring/controlling data usage.

Home Location Register (HLR): Registers SIM cards, stores subscriber information and privileges, maps internet access points, and enables management of dedicated IMSI series, special number allocation, and activation/deactivation of various services.

5G Core / User Plane Function (5GC/UPF): Separates user data from control data, handles high-bandwidth traffic, enables network slicing, and supports  use cases like IoT and VR/AR.

Policy and Charging Rules Function (PCRF): Enforces policies related to data usage and quality of service (QoS), manages service access and billing, and enables granular control over data plans and flexible billing models.

User Data Management (UDM): Stores and manages subscriber data, provides a single source of truth, simplifies subscriber management, and enhances security and privacy.

Operations & Business Support Systems (OSS/BSS): Manages the business side of the network (billing, CRM, service fulfillment), automates operational processes, improves customer service, and provides a unified view of the customer.

Short/Multimedia Message Service Center (SMSC/MMSC): Manages the store-and-forwarding of text and multimedia messages, ensuring reliable delivery and allowing independent control and customization of messaging services and pricing.

Owning these elements grants the Full MVNO the ability to customize services, gain deep customer insights, establish its own roaming and interconnect agreements, and truly differentiate its offerings in the market, providing a level of independence similar to an MNO, albeit without owning the radio access network.

Advantages:

Low Startup Costs: Reseller MVNOs require minimal initial investment and have a quick time to market because they don’t need to invest in network infrastructure. The MNO handles most technical aspects.

Core Business Uplift: The MVNO can be leveraged to boost the reseller’s primary business by offering bundled services.

Disadvantages:

Lack of Control: The MNO retains ownership of customers, user data, post-sale interaction, SIMs, and infrastructure. The MNO also sets tariffs and receives revenues from incoming traffic.

Brand Translation Challenges: An existing brand might not translate effectively into the mobile sector.

Limited Industry Expertise: Branded resellers often lack the necessary telecom experience, making it difficult to gain market share without a deep understanding of the mobile industry.

A Thin MVNO (Service Provider MVNO) offers significantly more ownership and control compared to a Reseller MVNO (Branded Reseller).

Customer and SIM Ownership: A Thin MVNO can own its own SIMs and customer relationships, which is not the case for a Reseller MVNO where the MNO retains customer ownership.

Tariff Setting: Thin MVNOs have some ability to set their own tariff bundles and packages, independent of the host network operator’s retail prices. Reseller MVNOs, on the other hand, have tariffs primarily set by the MNO.

Operational Responsibility: Thin MVNOs are responsible for customer care processes, including CRM, support, billing, tariffs, and associated IT platforms (BSS/OSS), incurring their own OPEX and CAPEX. Reseller MVNOs have fewer operational responsibilities, with the MNO handling most core processes.

Despite these differences, a Thin MVNO still does not own the International Mobile Subscriber Identity (IMSI) and has limited control over network routing capabilities, distinguishing it from Medium and Full MVNOs.

Yes, an MVNO, regardless of whether it is a Thin, Medium, or Full MVNO, does not necessarily need to invest in and own all of its own equipment or network elements.

It can partner with an MVNE (Mobile Virtual Network Enabler) to utilize the MVNE’s infrastructure and services. This partnership model allows MVNOs to reduce their capital expenditure (CAPEX) and operational complexity, as the MVNE provides the necessary technical platforms and support systems.

This flexibility is particularly beneficial for MVNOs looking to enter the market with lower upfront investment or those that prefer to focus their resources on marketing, customer acquisition, and service innovation rather than network management.

Sub-brands, also known as secondary or flanker brands, are telecommunications brands that are entirely owned and controlled by network operators. They are economically dependent on these operators and aim to differentiate offers and target specific customer groups.

However, from a competitive standpoint, sub-brand MVNOs are not considered significant players because they lack independence from their network operators and do not engage in price or innovation competition with them.

In contrast, other MVNO types (Reseller, Thin, Medium, and Full) generally operate with a greater degree of independence, even if they still rely on a host network operator for core network access.

While sub-brands are extensions of the network operator’s own offerings, other MVNOs strive to establish their own brand identity, customer base, and service differentiation, sometimes even owning significant portions of their operational infrastructure.

Hi, and welcome to Yozzo’s podcast dedicated to empowering mobile virtual network operators with the insights they need to succeed.

This is the place where we break down the complexities of the MVNO ecosystem.

Let’s get started.

So, if you’ve ever used one of those smaller, maybe more niche mobile carriers, you’ve actually been a customer of an MVNO.

That’s a mobile virtual network operator. Now, these are the companies that sell you mobile service, but here’s the kicker. They don’t own a single cell tower. So, how on earth do they do that?

Well, that’s what we’re going to break down.

And you know, if you’ve ever tried to figure this stuff out on your own, you get hit with this just this wall of jargon, right?

Airtime reseller, thick MVNO, thin MVNO, enhanced service provider. It’s an absolute alphabet soup. And honestly, it makes it feel impossible to figure out who’s who and what’s what.

But what if you could boil all that complexity down? What if it was really just four simple steps up a ladder?

That’s exactly what we’re going to do. We’re going to cut through all that noise and give you one simple framework to see how a company goes from just being a brand to a real honest to goodness mobile operator.

And here it is. We’re calling it the ladder of control. It’s pretty straightforward. We’re going to start at the bottom on the first rung with the basic reseller and we’re going to climb all the way to the top to the full MVNO.

And as you’ll see, every step up that ladder means more money. Yeah. But it also means way more control. All right, so let’s get started.

We’re on the very first rung of the ladder, the reseller MVNO. Think of this as the easiest, most common way for a new brand to dip its toes in the mobile world.

A reseller, well, it’s pretty much exactly what it sounds like. Their whole job is to focus on the flashy stuff, the branding, the marketing, the sales. They bring the customers in the door, but everything else, all the technical stuff, the heavy lifting, that’s all handled by the big guy, the host network, what we call the MNO or mobile network operator. So, you can see the appeal, right?

The huge advantage here is that it’s super cheap and incredibly fast to get started. You can launch a mobile brand almost overnight. But, and this is a big butt, the downside is massive. You have basically zero control. The host network owns your customer. They own the SIM card. They own all the user data, and they set the prices. You’re really just a sales front.

I mean, just look at how this breaks down. The reseller, their only job is marketing and sales. That’s it. Everything else you’d associate with a mobile company, billing, customer service, the actual SIM cards, the network itself, that’s all on the host MNO.

It’s a partnership for sure, but it’s a very, very one-sided one.

Okay, time to climb a little higher. We’re moving up to the middle rungs of the ladder. Now, this is where things get interesting. Companies start taking on more responsibility, a little more risk, but in return, they get a whole lot more say in their own future.

We’re talking about thin and medium MVNOs now. And this is where a brand starts to get really serious. You’re not just a sales agent anymore. Now you actually start to own the relationship with your customer.

You manage your own billing and you can even start creating your own unique services that make you stand out from the crowd. And the key word here is control. The MVNO now runs its own CRM. That’s the customer relationship management system. They have their own BSS or billing support system. Having that control is a gamechanger. It means they can set their own prices, create their own data bundles, and maybe most importantly issue their own branded SIM cards.

That’s a huge leap from being a simple reseller. But you know how it goes. With more control comes more responsibility and more cost. The upside is fantastic. You finally own your own customers.

You can build a real brand for a specific community. The downside though, your IT cost just shot way up, both for day-to-day operations and initial investment. And at the end of the day, you’re still relying on the big M for the actual network connection. All right, we’ve climbed all the way to the top. This is the final rung on the ladder.

We’re talking about the full MVNO, the most powerful, most independent a virtual operator can possibly be. Here’s the easiest way to picture this. A full MVNO is basically a traditional mobile network in every single way except one. They don’t own the radio towers. That’s it. They lease access to the towers, but pretty much everything else they own and operate it themselves.

And the perks of being at the top, they are huge. We’re talking complete ownership of the customer, your own blocks of phone numbers, and your own network switching gear. That last one is key.

It means you can negotiate your own roaming deals with other carriers. You get total flexibility and direct access to all that rich, valuable user data. I mean, the technical complexity here is just on another level.

A full MVNO might own and operate more than 15 separate pieces of the core network. all those complicated bits and pieces that make a mobile service actually work.

So, let’s just zoom in on two of the most important ones to really get what that control means. First up, you have the HLR, the home location register. Think of this as the master brain, the central database that keeps track of every single one of your subscribers.

When you own the HLR, you control your own SIM cards and you get to decide exactly what services each customer can access. Another critical piece of the puzzle is the GGSN. Okay, that’s a mouthful, but it’s basically the gateway to the internet for your customers.

It’s the on-ramp. And if you own that gateway, you can see, manage, and control all the data your customers are using. And in today’s world, that is an absolutely critical power to have.

Okay, so we’ve climbed the whole ladder from bottom to top. But you might be wondering, why does this whole system even exist? Why does any of this matter? Well, it turns out this isn’t just a business model.

This ladder is actually a core part of telecom policy around the globe. Yeah, this isn’t just about business plans. Governments are involved. Regulators all over from Europe to Singapore look at MVNOs and see a way to crank up the competition in the mobile market. They actually make rules to encourage new players.

Some places like Canada even give companies a push up the ladder, saying you have to own your own core network to even be considered an MVNO. So, it’s pretty obvious that getting to the top of this ladder gives you a ton of power.

But let’s be real, it’s also insanely expensive and technically complicated. That’s a huge barrier for most companies. But what if there was a kind of cheat code, a shortcut? Well, it turns out there is.

And it’s all thanks to another player in this ecosystem called an MVNE. That stands for Mobile Virtual Network Enabler. And these companies offer a partnership that, to put it simply, completely changes the game. It’s a B2B company and their whole business is basically selling a full MVNO in a box.

They build out all that complex expensive network stuff and then they rent it out to new companies. It lets an MVNO launch with all the power of being at the top of the ladder, but without having to build it all from scratch.

You could say they’re the ones who build the ladder for everyone else.

So, when you put it all together, what you have is this really clear path for new ideas in the mobile world. You’ve got this ladder of control where a company can pick exactly how much they want to invest and how much risk they want to take. And now with these enablers making that climb easier than it’s ever been, it really makes you wonder who’s going to be the next one to use this system to completely shake things up.

And that wraps up another episode of Yozzo’s podcast. If you want to dive deeper into today’s topic, you can find much more resources at yozzo.com. We’ll be back next time with more insights. Until then, keep innovating.