LIVE FROM MOBILE ASIA EXPO 2014: China Mobile has made a big pitch to attract the country’s newly licensed MVNOs onto its network.
“We need your support. Let’s collaborate and build a win-win situation,” Xu Gang, deputy general manager, marketing department, China Mobile, told attendees to the International MVNO Summit at Mobile Asia Expo.
He said MVNOs could find unexplored niches among China’s vast mobile market which operators are missing. “We do not fill all their needs,” he admitted.
In addition to targeting narrower demographics than operators, MVNOs can devise individual services, he said.
“Content and service differentiation is also possible. MNOs do a single service. If you can find a better service then you can find another win-win scenario.”
He also suggested that the internet of things offered a further market opportunity.
Currently, China Mobile is working with 17 MVNOs, said Gang.
China Mobile’s comments came as GSMA Intelligence published a new report on the global MVNO market. The report has a section on China, a newly created market for MVNOs.
The Ministry of Industry and Information Technology (MIIT) announced plans to license 11 MVNOs back in December 2013.
In fact, it has licensed 26 as of May 2014. So far, three have launched, of which two are hosted by China Unicom. The operator has predicted their arrival will unleash “cut-throat competition” in the country’s mobile market.
Joss Gillet, senior analyst, GSMA Intelligence, told the summit that Baidu and Alibaba – two of the country’s e-commerce giants – are most likely to be market leaders among MVNOs.
MIIT expects 50 million MVNO connections in 2015.
GSMA predicts at this point China will pass 100 per cent market penetration in terms of connections, and 50 million MVNO connections would account for just 3.5 per cent of the market at that time.
“The numbers hint at a lot more growth in the future in the country which we will be keeping a close eye on,” said Gillet.
Globally, said the report, MNOs host 943 MVNOs as well as 255 MNO sub-brands.
This represents a total of almost 1,200 mobile service providers worldwide hosted by operators, a figure which has grown from 1,036 in 2012.
The largest category of MVNOs are discount players who target low-value consumers and represent 28 per cent of the total.