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However, based on a review of the theory and practice of economic regulation specifically for facilitating market entry for MVNOs and the empirical evidence drawn from our surveys of the US and the EU member states, the case for ex ante regulatory intervention on behalf of MVNOs is weak to nonexistent. Thus, at least in countries with robust wireless competition, ex ante regulation to facilitate MVNO entry and participation in mobile markets is neither necessary nor inevitable.
The key is to determine the conditions that lead to the voluntary, not mandatory, formation of a strategic relationship between the two types of service providers. As long as MVNOs can help to widen or deepen markets served by MNOs, voluntary relationships will continue to form in the impressive numbers already evident on a global basis.
The long-term prospects of MVNOs will depend on how effectively the industry can move beyond a cost-based market strategy and exploit opportunities with mobile commerce, global positioning system applications, personal databases, and other offerings. With prices at or near marginal cost, future MVNO success stories will not be based on further discounting, but rather on value-added positioning. Some MVNOs will achieve this by relying on their brand value, innovative marketing, or expansive distribution channels.
Other MVNOs or prepaid operators will succeed in this market by targeting the needs of substantial and well-defined groups, such as ethnic groups, travelers, and youths. The greatest survival challenge for MVNOs, as well as the greatest source of growth, is the ongoing process of convergence and the opportunity to offer a combination of voice, video, and data over any one of several alternative platforms. The challenge for MVNOs is to continually introduce new features and services in order to stay ahead of the game. In this respect, an MVNO shakeout is quite possible, where MVNOs with a weak value proposition or an unsound business plan will be forced to exit the market.
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An SCP is a database residing in a Signaling System 7 network that is queried to determine how a call should be handled e. He specializes in the economics, business, and regulation of the communications and high-tech industries, and the evaluation of economic damages in intellectual property and commercial litigation disputes. The above article is based on a book that he recently authored with Dr. Our 45 years of experience creating strategies, studies, reports, expert testimony, and policy recommendations reflects our specialization in industrial and financial economics.
Our global team of more than professionals operates in 22 offices across North and South America, Europe, Asia, and Australia. This publication analyzes the latest issues in the economics of telecommunications, with an emphasis on regulation and competition. To access previous issues or subscribe please visit our webpage at: www.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. What are MVNOs? Should MVNOs enjoy regulatory protection? When in doubt, opt for regulation? Where do regulators stand on the MVNO question?
Do MVNOs need regulatory protection? Will ESPN be the first of many failures? Volume I Page About the Author Mr. To subscribe This publication analyzes the latest issues in the economics of telecommunications, with an emphasis on regulation and competition. All rights reserved.
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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. What are MVNOs?
Should MVNOs enjoy regulatory protection? When in doubt, opt for regulation? Where do regulators stand on the MVNO question? Do MVNOs need regulatory protection? Will ESPN be the first of many failures? Volume I Page About the Author Mr. To subscribe This publication analyzes the latest issues in the economics of telecommunications, with an emphasis on regulation and competition.
All rights reserved. Do you have a Question or Comment? Interested in the next Webinar on this Topic? Click here to register your Interest. Christian Dippon. Email Firm. Events from this Firm.