On the Economics of 3G Mobile Virtual Network Operators (MVNOs)

Authors:
D. Varoutas;D. Katsianis;Th. Sphicopoulos;K. Stordahl;I. Welling
Affiliations:
Department of Informatics & Telecommunications, University of Athens, Athens, Greece GR 157-84;Department of Informatics & Telecommunications, University of Athens, Athens, Greece GR 157-84;Department of Informatics & Telecommunications, University of Athens, Athens, Greece GR 157-84;Department of Informatics & Telecommunications, University of Athens, Athens, Greece GR 157-84;Department of Informatics & Telecommunications, University of Athens, Athens, Greece GR 157-84
Venue:
Wireless Personal Communications: An International Journal
Year:
2006

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Abstract

The paper assesses the market conditions and dynamics, the architectures and the different approaches for deployment of 3G Mobile Virtual Network Operators (MVNOs), in an attempt to address specific advantages and pitfalls. Following the definition of appropriate service sets and tariff structures, and taking into account demand scenarios, a techno-economic model has been developed, in order to compute key economic indicators. The paper presents techno-economic results of specific business cases and deployment alternatives for an average "large" European country and a smaller, Nordic-type country. Fixed and variable costs have been identified and the business case shows how different service sets lead to different costs. Different MVNO business profiles have been investigated. Profitability for all scenarios and business profiles has been calculated, presented and discussed. Major opportunities and threats, as well as critical parameters and uncertainties have been identified through sensitivity analysis.