Xiaomi has managed to grab the eyeballs, yet again with their Mi 4c smartphone, which is one of the most affordable unlocked devices powered by Snapdragon 808 and available in the price range of $200. Amidst all the hoopla, Xiaomi has announced another important service called Mi Mobile, which essentially is a MVNO service.
Mobile Virtual Network Operator is an arrangement in GSM technology wherein an operator who doesn’t own a licensed spectrum and is without any network infrastructure will resell the wireless services under their brand umbrella. This is done by fostering a business deal with the licensed telecom operator and then resell the usage to their customers, more like subletting a building. In fact Virgin network was the first example for MVNO way back in 1999 and it has contract with most of the operators across UK, Australia and Canada.
Those interested in the MVNO services can buy the Mi Mobile SIM card online and they will get a triple cut SIM card pack which can be used in phones with varying size of SIM cards. In the Chinese context, Xiaomi has roped in Unicom’s 3G and 4G networks and it will offer data and voice packs starting from $0.018/MB for data and the best part is that you can pay as you use without any minimum package.
Google had created quiet a hype when it announced Project Fi, a MVNO Wi-Fi offering that would offer access to over 1 million U.S Wi Fi hotspots for $20, calls and low cost international texting to more than 120 countries. The best part of the deal was the fact that customers will be credited back for their unused data by the end of the month. Although this plan seems cheaper at the outset, it is in fact costlier than the friends and family pack, which the users usually opt for in the US.
In India, TRAI had recently brought the MVNO under the purview of licensing framework, so that it would be easier for new players to enter the market and offer better and more competitive services to the customers. One could become a MVNO operator in India by paying a certain license fees apart from the one time entry fees.
Although MVNO has been touted as the next big thing, it is not much of a game changer. Moreover, the recent debacle on spectrum shortage clearly outlines the incapability on the operator’s end to fulfill the spectrum requirements. We doubt if the telecom operators would be able to carry the extra load of the MVNO operators without buckling. That being said, Xiaomi has taken a big leap introducing MVNO services in China and this will be yet another step to fortify the Xiaomi ecosystem.