India’s telecoms watchdog is reported to have given the green light to the entry of “virtual” network operators, with suggestions that the emergence of such players could prove both a blessing and a curse for existing telcos.
According to Hindustan Times, India’s Telecom Commission has approved a recommendation that MVNOs should be allowed to enter the market, although it still needs a nod from the country’s minister with responsibility for telecoms.
The new players will need to pay for licences and fees similar to those levied on existing operators.
Virtual operators will be able to offer a range of services as provided by the host network, and can also work with more than one partner. Network operators can also support more than one MVNO.
The benefits of the introduction of MVNOs into the market for operators is that they will be able to monetise unused capacity, as well as receiving additional revenue to support ongoing operating expenses.
It was mooted that this might mean the most likely operators to support MVNOs will be those that are less successful, whereas the market leaders already have their networks running much closer to capacity.
And on the flip side, MVNOs will provide additional competition in what is already a price-sensitive market, which has only recently seen tariff stabilisation after a fierce price war. The entrance of Reliance Jio Infocomm into the market is also likely to add to the disruption.
In other markets, MVNOs have often looked to address underserved markets that traditional operators have struggled to reach, such as specific ethnic groups.
But also seeing significant success have been retailers, who already have established relationships and channels to customers.
And fixed line players and media companies also see virtual operations as a way to extend their reach into mobile, through bundled content and connectivity packages.