Mobile virtual network operators will play a major role in driving mCommerce.
Mobile network providers are becoming increasingly aware that basic services are not enough to earn customer loyalty. WAP-enabled phones are already providing basic, interactive information services, such as traffic and weather updates. There will be 95 million wireless data/WAP subscriptions in the US by 2005.
However, as value-added services become more important, network providers fear that content and service providers, all aiming to gain a degree of ownership of the customer relationship, will clutter screen space and make their brand less visible to the customer. This will leave an opening for mobile virtual network operators (MVNO) that leverage well-known, trusted brands to act as sales and distribution channels for licensed wireless carriers. Currently, the best example is Virgin Mobile. It has virtual network services in Britain, Australia and Singapore and plans to launch services in the US market within the next two years.
The US market is especially attractive for the MVNO business model. An MVNO can sidestep the standards and licensing issues that characterize the market, building national coverage out of a patchwork of CDMA, TDMA, and GSM infrastructure. It can also provide a solid platform for mCommerce transactions and brand marketing.
The advent of 3G wireless networks will also be a strong enabler of MVNOs in the US. Not owning the network infrastructure will free up capital to concentrate on marketing. The MVNOs will also be able to avoid the problem of different standards, offering all consumers the same pricing and services nationally. They will provide the appropriate phone and eliminate buyer confusion.
Overall, as content becomes a major factor in mobile services, customers will want products and services tailored to fit their particular lifestyles, coupled with outstanding customer service. The leading players in retail, finance and commerce have experience in tailoring products in precisely this way, so they should be able to extend this coverage into the mobile sphere, especially since they can design their services based on consumer preference, rather than on the limitations of their chosen technology. MVNOs are likely to become major players in the US mobile market over the next few years.
