Despite problems and hardly satisfying performance, more companies are joining the ranks of those willing to enter the MVNO (or quasi-MVNO) business in Poland. Market-research firm PMR estimates that about 20 Polish firms are seriously interested in entering the mobile market. Moreover, a number of foreign businesses are negotiating MVNO deals with operators which have their own infrastructure.

PMR analysts believe that, as a matter of fact, any firm with a brand name which is valuable and known on the Polish market can consider developing MVNO operations. Apart from mobile operators, top thirty most valuable brands mainly include banks and financial institutions (PZU, PKO BP, Pekao, Lukas Bank, ING), breweries (Tyskie, Zubr, Zywiec, Warka) and TV stations (TVN, TVP, Polsat).

On the other hand, the range of possible entrants on the MVNO in Poland is, theoretically, not limited - in terms of financial potential - only to the largest players and most known firms that are well-positioned to incur considerable capital expenditure. Though, undoubtedly, advertising and promotion of a new operator can be a heavy expense for smaller companies.

In total, over 20 MVNOs can emerge on the Polish market presently, but fewer will survive.

In three or four years' time, acquisitions can be expected on the market, as a result of which the number of MVNO players will shrink. Consequently, only the strongest few will stay on the market. In the opinion of PMR analysts, due to a high penetration rate of the Polish mobile market, MVNOs will not seek to target customers not using mobile services at all. Conversely, they will try and exploit the increasingly common usage of multiple SIM cards by individuals. As at the end of 2007, 14% of mobile users in Poland had more than one active SIM card. According to PMR forecasts, the ratio is expected to rise to approx. 25% at the end of 2011.

Factors fostering the emergence of MVNOs can be hypothetically divided into external and internal ones. At the current development stage of the telecoms market and the mobile market in Poland, the latter is of utmost importance for prospective MVNOs.

Thus, the success of new virtual operators on the mobile market in Poland principally depends on finding the right market niche and addressing a product and service offering to a specific group of customers. The key issues include the added value offered and widespread advertising, especially at the early stage. Potential for integration and offering of mobile services bundled with other services is an important factor as well. Another key issue remains a well-developed distribution network. The existing MVNOs, who have entered the Polish market so far, have not taken all of these factors into account.

Furthermore, it should be added that the success of virtual operators should not be measured by the same standards as the success of network market players, for whom mobile telephony is the core and strategic business activity. Strategies of mobile virtual network operators in Europe show that a large portion of MVNO projects do not aim at winning a significant mobile market share or achieving high margins on this business. Objectives pursued are quite frequently different and include, for instance, addition of variety to or expansion of companiesÃ' service portfolios (convergence element and packaged sales), synergies of loyalty campaigns and programmes with telecommunications services or enhanced company image.

Posted to the site on 24th April 2008

Posted to: www.cellular-news.com/story/30746.php