Six (6) less common questions to ask your MVNE

With the rise in popularity of Mobile Virtual Network Operators (MVNOs), and subsequently, the amount of capital coming into the telecom industry, let’s talk about what to look for when choosing a Mobile Virtual Network Enabler (MVNE).

Today you will hear terms such as “MVNO-in-a-box” or “one-stop-shop” from Mobile Virtual Network Enablers (MVNEs) to try and sound all-encompassing for MVNOs. Some have even successfully raised 10’s of millions of dollars touting just this. Here’s the problem, do you as an MVNO want to have to fit into such constraints? Hopefully, you said no.

While an MVNE may be well funded, this should never trump the following, which I admittedly feel are much more important offerings.

*Disclaimer; you won’t find common topics below such as an API offering, because, frankly, if the MVNE doesn’t even offer an API stack, turn and run, there is zero scalability for your business without an API stack. Therefore, here is a less common, but perhaps even more important list.

Expertise

Arguably the most important element is industry expertise. With MVNOs being a hot topic, you are finding many new SaaS players coming in and flashing fancy platforms. The issue is that very few are what I would deem “experts” in telecom and many have very little to no prior telecom experience in starting their MVNE. So, don’t be afraid to ask about their experience. A tough conversation upfront will save you from even more pain in the long term.

Hidden Cost

The old adage “if it sounds too good to be true it probably is” reigns true once again. I have several conversations a month that start with something like “X MVNE said their costs are $X”. With just that information I can tell if an MVNE is withholding costs. And if after you sign the agreement you see costs on your invoice that weren’t disclosed, be prepared to argue those. I am finding costs such as taxes, surcharges, and even transaction fees are rarely mentioned when verbally discussing pricing. While the above fees are not prevalent with each MVNE, they are in many cases so make sure you understand all fees involved.

Coverage Map

Most MVNOs would not even think about asking if they have access to the same coverage map as retail (direct with the carrier), but this is often not the case. With some networks, if the MVNE has not negotiated with the Mobile Network Operator (MNO) a full coverage map in their contract, you as an MVNO will be on a reduced coverage map…and it is a horrible customer experience, which ultimately will turn into a horrible experience for you as the MVNO.

QCI band

Another topic most MVNOs won’t even know to ask is what QCI, or “band” do you have access to? Similarly to the coverage map, if the MVNE hasn’t negotiated for the right (or best) QCI, you as an MVNO (and your subscribers) will not have the same priority access that going direct with the MNO would bring you. Not being on the best QCI will affect things such as priority access, latency, and speed.

Value-adds

When setting up your MVNO, your MVNE should supply most of what you need to run your business. However, increasingly, value-adds have become even more important to MVNOs. At a minimum, you as the MVNO should receive APIs, a platform to manage your business outside of APIs, and some level of customer support. Going a step further, receiving additional value-adds will make your MVNO that much stronger. Some value-adds such as device and accessory sourcing are becoming a necessity to help differentiate your MVNO. Device financing and insurance are also becoming more prevalent in the industry. When it comes to device financing, you will want to make sure you are using a reputable company and one that is flexible with its terms (interest rates and payment terms) based on your MVNO and potentially even your subscribers.

Registration & Taxes

As an MVNO, you will need to file in every state (USA) in which you plan to sell cellular services. The documents, costs, and time for approval vary by state. You will also need to make sure you are collecting the correct taxes. There are thousands of taxes in the telecom industry when you break down federal, state, and local that need to be collected (and paid), per state. While registering in each state and making sure you are collecting the proper taxes may seem daunting, your MVNE should be tied into companies that can help you do this with relative ease. If they can’t, find another one!

There are several other questions you as an MVNO should ask. If you would like to know more then reach out to me.