India Authorizes MVNOs, Will New Business Models Emerge?

Allowing operation of  mobile virtual network operators in the Indian mobile market will be a game changer, says Ravi Shankar Prasad, Communications, and IT minister.

Others are not so sure, given the intensely-competitive nature of the Indian mobile market and the entry of Reliance Jio into the market.

Perhaps paradoxically, the Telecommunications Regulatory Authority of India believes the new MVNOs will primarily focus on services for customers in rural areas, since that is an underserved niche.

Much could depend on the full details of the enabling regulations, which appear to allow a significant amount of owned facilities, though MVNOs will not be allowed to be assigned spectrum by the underlying carriers or build or least their own “core network” facilities.

It is not immediately clear whether MVNOs will be allowed to separately acquire spectrum.
The definitions will matter.

In any scenario, it appears India could be part of a new  trend for MVNO business models.

Traditionally, MVNOs have rented virtually everything they need from an underlying carrier, without building their own facilities or acquiring spectrum.

But new possibilities are emerging as cable TV operators, for example, explore “Wi-Fi first” models that are a blend of rented capacity and owned infrastructure.

So the interesting angle in India will be whether new forms of wholesale services and owned facilities will emerge.

For example, would a fiber connection from a village to the furthest optical node operated by an existing facilities-based mobile operator be considered “core” or facilities allowed under the rules for MVNOs?

That, of course, assumes MVNOs can own their towers, radios and associated infrastructure, something that typically is not part of the MVNO licensing regime in other countries. But such nuances would not be new.

As in the past, the difference between resellers and MVNOs was sometimes hard to define with precision. In some cases, the distinction turned on such nuances as whether the MVNO had its own billing system, while a reseller used the underlying carrier’s billing system.

So, too, might the difference between an MVNO and a facilities-based mobile operator become a bit more porous.
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