TSSF: Nigeria’s MVNOs Get Commendation for Contribution to Economy
- Urged to offer more tailored-made, generic services to consumers.
The Mobile Virtual Network Operators (MVNOs) which emerged from the evolution of the telecommunications industry and mobile market have received commendation for their contributions to the nation’s economy.
Mrs Bukola Olanrewaju, Telecoms Sector Sustainability Forum (TSSF) Convener, gave the commendation during the second edition of the TSSF with the theme: “Creating Awareness & Ensuring Sustainability of mobile virtual network operators (MVNOs) in Nigeria’s 5G ecosystem held in Lagos.
Bukola described the mobile virtual network operators (MVNOs) as wireless communications services providers that does not own the wireless network infrastructure over which it provides services to its customers.
According to her, they are believed to be of immense value to the mobile telecommunications industry as they provide services at an affordable rate to customers and work with Mobile Network Operators (MNOs) who own the telecommunication infrastructure.
“According to GMSA’s Sub-Saharan Mobile Economy Report for 2021, mobile networks have become a lifeline for people and businesses during this time, especially where the adoption of mobile services such as mobile data and mobile money is concerned. It is estimated that, across Sub-Saharan Africa, there will be 120 million new subscribers by 2025, taking the total number of subscribers to 615 million (50% of the region’s population).
“The increasing number of mobile subscribers, technological advancements, and demand for connectivity have also played an important role in creating a significant opportunity for MVNOs to thrive in the sector,” she said.
She cited the McKinsey paper which states, “The latest evolutionary wave is seeing MVNOs capture 10 to 40 per cent of mobile business in developed markets”.
The TSSF convener posited that with the appropriate regulatory environment and access to infrastructure, MVNOs in emerging markets like Africa can be steered in the same direction.
In addition, she said, mobile technology plays an increasingly important role for consumers and businesses alike, and for many Nigerians, mobile broadband is the first and only option for accessing the internet.
She explained that this increased growth and adoption has created an opportunity for MVNOs to provide new digital solutions for small and large enterprises and customers.
“This is primarily because MVNOs have the flexibility, agility, connectivity, and competitive pricing to develop new value-added solutions, innovative B2B, B2C, IoT applications, rich communication messaging, and offerings,” she added.
She noted that by 2020, some estimates put the total number of MVNO subscribers on the continent at upwards of 110 million – not far off four times the total number in the USA.
According to Adroit Market Research, “the MVNO market will reach USD 112.0 billion by 2025 due to this growth, although the market in the United States is considered mature and developed. Europe is the region that stands out the most in the results since it accounts for 60% of the total existing MVNOs. It is then safe to say Europe is the world’s oldest, largest and most mature MVNO market ever recorded.”
She pointed out that the United States Mobile Virtual Network Operator (MVNO) Market was valued at USD 13.15 billion in 2020, and it is expected to reach USD 16.24 billion by 2026.
In recent years, a limited number of MVNOs, she said, have managed to break into the African market, stressing that South Africa has had MVNOs operating in the country for some time, while MVNOs were recently awarded licenses in Kenya, Rwanda, Uganda and Tanzania.
“Up until recently, MVNO penetration across Africa has been relatively slower than in the rest of the world. But, the COVID-19 pandemic has shifted this and created more opportunities for MVNOs to position themselves as competitors within this market,” she said.
The introduction of Mobile Virtual Network Operators (MVNOs) she stressed, is believed to add value for both operators and customers; for the operators by using their available excess capacity and for the customers by offering innovative and several niche value-added services that were not offered by Mobile Network Operators (MNOs).
However, from the consumer side, she revealed that MVNOs can provide more competitive offerings, which means lower costs without compromising on service, but utilizing network capacity without having to own it frees up costs that are then passed down to the consumer.
Bukola opined that the MVNOs can also offer a more tailored-made service via MNOs, which tends to offer more of a generic service that suits the masses.
“TSSF wishes to notify you that this series will run for five years to harness and evaluate the successes recorded in this segment of the Nigeria telecom sector,” she announced.
