MVNOs marshal their forces

11 May 2005

A growing number of players interested in pursuing a mobile virtual network operator (MVNO) strategy upon the completion of an EU case being pursued by the Commission for Communications Regulation (ComReg) are marshalling their forces with a view to having services available later this year.

It emerged today that Irish-owned telecoms operator Perlico Communications has indicated its intention to expand its current service portfolio of fixed-line and broadband services and enter the Irish mobile market as an MVNO.

MVNOs — companies that offer mobile services on the back of the infrastructure of an existing mobile operator — are enjoying widespread success across Europe and in recent months ComReg chairwoman Isolde Goggin designated O2 and Vodafone as having joint dominance within the Irish mobile market.

Since then a growing number of established telecoms companies have signaled their interest in launching an MVNO play. These include: fixed-line player Pure is hoping to become an MVNO on the back of the network of 3G player 3, which is set to launch its services later this year; pan-European Irish telco BuyTel; and Ireland’s first original MVNO Imagine, which was shut down following a court battle with Eircell back in 2000.

It is also envisaged that incumbent telco Eircom will later this month signal its plans to return to the Irish mobile market, which sources reckon will either be as an MVNO or following an outright acquisition of Meteor. It is widely believed the latter strategy is more favourable to Eircom, which will then seek to leverage its large bill-paying customer base with a view boosting its presence in the mobile sector, offering such options as bundled billing packages.

Perlico recently appointed a founder manager of Esat Digifone Derek Hanley to the role of managing director of Perlico.

Perlico’s chief executive Iain MacDonald explained the company’s reasons for wanting to becoming an MVNO: “With the two leading operators earning substantial profits equal to circa 0.75pc of the entire country’s gross domestic product, there is a definite requirement for more competition within the sector.

“We are confident we can replicate our existing successful fixed line and broadband model and push down charges within the mobile sector. This will deliver the benefits of competition to mobile customers in the form of more choice as well as significantly lower prices,” MacDonald said.

In recent days it emerged that venture capitalist Barry Maloney has stepped down as chairman of O2 Ireland in order to avoid a conflict of interest with a new MVNO start-up he is spearheading with former O2 Ireland finance director Niall Norton called Clever Communications. According to sources, Maloney and Norton are negotiating a potential MVNO play with Ireland’s three mobile operators, Vodafone, O2 and Meteor.

Pictured above are Perlico managing director Derek Hanley and chief executive Iain MacDonald

By John Kennedy