Fixed-line operator Pure Telecom seems certain to enter the mobile market following the European Commission’s recent endorsment of the Commission for Communications Regulation’s (ComReg) ruling that mobile virtual network operators (MVNOs) were needed to increase competition in the Irish market.
Speaking to siliconrepublic.com, Pure director Paul Connell revealed that the firm was looking to become an MVNO on the network of 3, Ireland’s fourth mobile operator, whose launch is seen as imminent. A condition of 3 being awarded a 3G licence was that it would carry an MVNO on its network.
Connell said that negotiations with 3 were at an advanced stage and that Pure Telecom would “most definitely” be in a position to become an MVNO with 3, which is run by Hong Kong-based telco Hutchison Whampoa. As soon as 3 is launched, it “will look to host an MVNO straight away,” Connell felt.
He added that Pure’s MVNO would target the lucrative postpay market rather than the more competitive prepay side.
While last Friday’s decision by the commission paves the way for new entrants to the mobile market via an MVNO model, Connell acknowledged that it could be some time before this actually happens. Both O2 and Vodafone have vowed to appeal ComReg’s controversial decision to the Electronic Communications Appeal Panel, a process that could take several months to complete.
Commenting on Pure’s other plans for 2005, Connell said the firm would be looking “fairly aggressively” at making acquisitions and was in the process of identifying suitable acquisition targets. The company made two significant buys last year. Last june it bought out MCI’s SME customer base and in September it acquired Comac voice and data.
“This is a volume-based business and we need volume,” he said.
Connell also revealed that Pure Telecom planned to expand into central Europe from a base in Austria, where it opened offices last September. “We’ll be trying to mirror what we’ve done in the Austrian market in the Czech Republic and Poland,” he said, acknowledging that the success of another Irish-owned telco, eTel, in the region had shown what could be achieved.
Pure Telecom’s turnover doubled to €4.5m in 2004 and Connell expected this to rise to €10m this year. The company also turned its first profit last year and profits would continue to grow during 2005, he predicted.
Pure Telecom was founded in 2002 by Connell and business partner Alan McGonnell, both of whom previously held senior posts at GTS.
By Brian Skelly