The MVNO market was valued at USD 61.9 billion in 2020, and it is expected to reach a value of USD 91.63 billion by 2026, registering a CAGR of 6.75% over the forecast period 2021-2026. New Technology enablers, like e-Sim, AI, ML, and edge computing are creating new opportunities for MVNO.
- MVNOs are well-established in developed markets and will become increasingly important in developing markets as they mature. In recent years, competition in the MVNO market has shifted from pricing to value-added services and product differentiation, owing to the prominence of MNOs in the low-cost cellular services market in both developed and developing countries.
- Growing penetration of mobile devices is driving the market growth. GSMA predicted that the number of unique mobile subscribers increased from 4.66 billion in 2015 to 5.59 billion in 2019. Additionally, it predicted that 72% of the global population would be subscribed to a mobile service by 2020.
- Increasing number of services such as cloud, Machine to Machine (M2M) transactions, and mobile money are further expected to augment demand for mobile virtual network operators over the forecast period.
- Additionally, increasing government initiatives like the Digital Single Market (DSM) strategy, to eliminate copyright issues and geo-blocking problem and to deliver better network service access for consumers in Europe is anticipated to boost the market’s growth over the forecast period.
- In order to ensure business continuity owing to the COVID-19 outbreak, business organizations, especially in highly affected countries, are allowing their employees to work from home (WFH). Vodafone UK has witnessed a 50% increase in internet traffic. Orange Espańa is offering customers access to the free data bundles.
- COVID-19 outbreak will accelerate the demand for agile and flexible work styles and further push the adoption of communication services that tend to enhance work-life balance. However, telecom regulators have postponed their plans of 5G spectrum auction amidst the global pandemic.
Key Market Trends
Consumer Segment is Expected to Hold a Significant Market Share
- This is the primary and the most focused on segment among MVNOs. The growing number of single mobile subscribers and the increasing penetration of mobile in emerging economies are the major factors fuelling the segment growth.
- It is expected that by the end of 2020, there is likely to be 20.4 billion connected devices, and the number could reach 82 billion by 2025. In the recent past, Verizon invested USD 2 trillion on networked endpoints and related services market. This offers a huge opportunity for the telecom sector and the studied segment.
- Traditionally, B2C or consumer segment dominated over B2B part regarding innovation and pricing. Billing a fleet of devices and managing them is much more difficult than a simple consumer service. Due to convenience and more profit margin, MVNOs also prefer investing in the consumer segment.
- The growing adoption of e-SIM is also expected to expand the scope of the studied segment. The e-SIM, with the remote provisioning standards created by the GSMA, provides the simplicity and flexibility to MVNOs’ vendors.
- According to G+D Mobile Security, it is estimated that there are likely to be around 1 billion devices connected by e-SIM by the end of 2020. However, this is expected to grow at an exponential rate, reaching almost 2 billion shipments by 2025. The studied segment is further expected to be driven, both by increased adoption of M2M technology, but also by e-SIM in the consumer market, as the IoT creates more and more crossover in B2C markets.
China is Expected to Hold a Major Market Share
- China accounts for a major market share in the region as the country has always remained at the forefront in the adoption of technological advancements like 5G technology, connected mobile devices, smartphone penetration, amongst others.
- China’s mobile market has planned to open up to commercial licenses for MVNOs after the Ministry of Industry and Information and Technology (MIIT) launched a public consultation seeking industry input and feedback on the government’s proposal to allow commercial MVNO licenses, including foreign-invested firms.
- According to CNNIC, the number of mobile internet users in 2018 in China was approximately 816.98 million. Also, according to GSMA, the number of SIM connections in 2019 was 1.65 billion, which is expected to reach 1.73 billion by 2025. Moreover, according to MIIT, in 2019, about 449 million broadband connections had been installed in China. These trends are expected to boost the revenues of MVNOs in China during the forecast period.
- The Chinese government has also been pushing the development of its 5G industry, favoring its own companies, such as Huawei and ZTE, which both make equipment necessary for the technology to work. Moreover, according to GSMA, there will be 807 million 5G connections by 2025. China is expected to account for the largest number of 5G connections globally in 2025.
The MVNO market is highly competitive primarily owing to the presence of multiple players in the market. The market is leading towards fragmentation, with the major players in the market adopting strategies like service innovation, strategic partnerships in order to expand their client base and stay competitive in the market. Some of the major players include Lebara Group BV, TracFone Wireless Inc., FRiENDi Mobile, among others. Companies are involved in providing sales service, customer service, and mobile service to subscribers.
- December 2019 - 1&1 Drillisch AG planned to lease spectrum for the installation of its own 5G mobile network at Telefónica. This involves two frequency blocks of 10 MHz each in the 2.6 GHz band. The two frequency blocks will be available to 1&1 Drillisch until 31 December 2025. The agreement is subject to the approval of the Federal Network Agency.
- September 2019 - Lebara Group partnered with ZEE5, the digital entertainment platform from ZEE Entertainment Enterprises to bring the largest library of entertainment content for South Asians. Lebara Australia customers will be able to get a six-month ZEE5 subscription bundled with select prepaid plans.
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1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET DYNAMICS
4.1 Market Overview
4.2 Industry Attractiveness - Porter's Five Forces Analysis
4.2.1 Threat of New Entrants
4.2.2 Bargaining Power of Buyers
4.2.3 Bargaining Power of Suppliers
4.2.4 Threat of Substitutes
4.2.5 Intensity of Competitive Rivalry
4.3 Industry Value Chain Analysis
4.4 Market Drivers
4.4.1 Increasing Mobile Network Subscribers and the Growing Penetration Of Mobile Devices
4.4.2 Rising Demand For Efficient Cellular Networks
4.5 Market Challenges
4.6 Assessment of Impact of Covid-19 on the Industry
5 MARKET SEGMENTATION
5.2 Operational Mode
5.2.2 Service Operator
5.2.3 Full MVNO
5.2.4 Other Operational Modes
5.4.2 Cellular M2M
5.4.4 Media & Entertainment
5.5.1 North America
188.8.131.52 United States
184.108.40.206 United Kingdom
220.127.116.11 Rest of Europe
18.104.22.168 South Korea
22.214.171.124 Rest of Asia-Pacific
5.5.4 Latin America
126.96.36.199 Rest of Latin America
5.5.5 Middle East and Africa
188.8.131.52 United Arab Emirates
184.108.40.206 Saudi Arabia
220.127.116.11 South Africa
18.104.22.168 Rest of Middle East and Africa
6 COMPETITIVE LANDSCAPE
6.1 Company Profiles
6.1.1 Lebara Group BV
6.1.2 TracFone Wireless Inc.
6.1.3 FRiENDi Mobile
6.1.4 Boost Mobile LLC (T-Mobile)
6.1.5 Virgin Mobile USA Inc.
6.1.6 Tesco Mobile Limited (Tesco PLC)
6.1.7 Cricket Wireless LLC (AT&T Inc.)
6.1.8 Lycamobile UK Limited
6.1.9 PosteMobile SpA
6.1.10 1&1 Drillisch AG
6.1.11 Airvoice Wireless LLC
6.1.12 ASDA Mobile
6.1.13 Giffgaff Ltd
6.1.14 Kajeet Inc. (Arterra Mobility)
6.1.15 Truphone GmbH
6.1.16 Voiceworks GmbH
6.1.17 Asahi Net Inc.
7 INVESTMENT ANALYSIS
8 MARKET OPPORTUNITIES AND FUTURE TRENDS
Secondary Research Information is collected from a number of publicly available as well as paid databases. Public sources involve publications by different associations and governments, annual reports and statements of companies, white papers and research publications by recognized industry experts and renowned academia etc. Paid data sources include third party authentic industry databases.
Once data collection is done through secondary research, primary interviews are conducted with different stakeholders across the value chain like manufacturers, distributors, ingredient/input suppliers, end customers and other key opinion leaders of the industry. Primary research is used both to validate the data points obtained from secondary research and to fill in the data gaps after secondary research.
The market engineering phase involves analyzing the data collected, market breakdown and forecasting. Macroeconomic indicators and bottom-up and top-down approaches are used to arrive at a complete set of data points that give way to valuable qualitative and quantitative insights. Each data point is verified by the process of data triangulation to validate the numbers and arrive at close estimates.
The market engineered data is verified and validated by a number of experts, both in-house and external.
REPORT WRITING/ PRESENTATION
After the data is curated by the mentioned highly sophisticated process, the analysts begin to write the report. Garnering insights from data and forecasts, insights are drawn to visualize the entire ecosystem in a single report.