In this thought study presentation Cartesian addresses the current and future trends, and likely evolution of the MVNO market from research and analysis conducted in late 2011.

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Cartesian Ltd. Registered in England and Wales. Registered Number: 03230513
Registered Office Address: Descartes House, 8 Gate Street, London WC2A 3HP United Kingdom
Cartesian Perspectives
What Does the Future Hold
for the MVNO Market?
January 2012

2. 2Confidential and Proprietary — Copyright © 2014 Cartesian Ltd. All rights reserved.
Cartesian™ is a specialist provider of consulting services and managed solutions to
the global communications, technology and digital media industries
Company Overview
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Our clients are the global leaders in the communications, technology and digital media
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MVNO Expertise
Cartesian has worked on 40+ MVNO projects throughout the US, Europe, the Middle East
and Asia
• Strategy and business case support including detailed cost and
revenue modelling
• Negotiation support for contracts and commercial terms
• Vendor evaluation and selection, including architecture design
• Securing funding
• PMO and launch support (e.g. proposition development,
distribution, platform deployment)
MVNOs
MNOs
Regulators
• Assessment of MVNO policy, regulation and market impact
• International regulatory benchmarking and support with
preparation of NRA’s regulatory licensing framework
• Preparing the MVNO business case, drivers and alternative
operational and commercial models
• Detailed cost and revenue modelling to calculate MVNO /
wholesale commercial terms
• MVNO and sub-branding strategy including scenario analysis
• Cost modelling to determine wholesale pricing
• Identification and recruitment of wholesale / MVNO partners
• Development of optimal operational and technical architecture
• Internal segmentation analysis
• Vendor short-list, assessment and selection
Confidential
Retailers

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Context
In Q4 2011, Cartesian conducted research and analysis to understand the state, current
and future trends, and likely evolution of the MVNO market
Interviews
• Cartesian interviewed a
number of key individuals
within the MVNO space,
including MVNOs, MNO
wholesale teams, MVNEs and
MVNAs
Secondary Research
• Cartesian conducted
secondary web research to
capture details on recent
MVNO launches, failures and
success stories
Thought Leadership
• Cartesian drew on its knowledge
base and experience from over 40
MVNO projects
• We hypothesised trends and
validated with research
Outputs
• The research and analysis was
conducted throughout Q4
2011
• Findings were presented at the
MVNO Conference in Paris on
November 22
• This presentation contains the
results of our analysis, and
focuses on 12 key trends in
MVNO: 6 emerging
opportunities, and 6 trends
impacting the market
Scope of Thought Study

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Key Questions
Throughout this Thought Study, we address the following key questions:
What is the state of the MVNO market today?
What are the emerging MVNO opportunities?
How are commercial and operational models evolving?
What are the emerging MVNO opportunities?
How are commercial and operational models evolving?

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New MVNOs
MVNOs continue to roll out on a weekly basis…
Nov 2011
US
$19/month service
mandating WiFi
offload for calls and
internet usage
Oct 2011
Mexico
Complementing
Megacable’s
existing triple play
offering
Oct 2011
Spain
A low cost service
launched by
Spanish portal
Movilonia and
MVNO Ortel Mobile
Oct 2011
Switzerland
Targeting ethnic
communities.
Already operates in
five other European
countries
Sep 2011
Austria
Retailing via a
network of
tobacconists across
the country
Sep 2011
Australia
Competitions to
Red Bull events and
two handsets with
a dedicated
Facebook button
Sep 2011
Germany
A service provided
by an auction TV
channel from
Germany
Nov 2011
Malaysia
Targeting the youth
sector, offering
365-day validity for
top ups
Oct 2011
UK
Customers pay
upfront for a 1, 3, 6
or 12 month
contract
Nov 11
Netherlands
A low cost service
launched by Dutch
supermarket chain
Dirk van den Broek

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Lack of demand
Lack of funding
Regulatory
Lack of demand
Brand
Rationalisation
Lack of demand
Not as profitable as
core business
MVNO Failures
…However, failures still occur for common reasons
Source: Prepaid MVNO, Mobile News, Cartesian
xx
xx
xx
nutshell
hablafacil
xx
xx
Ethnic (youth British
Asian market)
Charity / donation
1st MVNO in market,
prepaid
Customers with poor
credit ratings
Immigrant
Youth
Quad-play
Nov 2010 – Sep 2011
(11 months)
Oct 2010 – Aug 2011
(11 months)
May 2010 – Aug 2011
(16 months)
Mar 2010 – May 2011
(15 months)
Mar 2009 – Dec 2010
(22 months)
May 2009 – Oct 2011
(30 months)
Nov 2010 – Mar 2012
(17 months)
Reasons For FailureCountry Description Duration

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MVNO Market Share Worldwide
Market share and growth trends vary significantly by market
Sources: Cartesian, Nereo, company websites, press releases
South America
<1%
Hong Kong:
• Total: 8%
Japan
• Total: 2%
• JCI (largest MVNO)
Australia:
• Total: 4%
• Virgin Mobile
• Boost Mobile
Oman:
• Total: 9%
• FRiENDi (6%)
• Renna (3.%)
USA:
• Total: 7%
• Tracfone (19.3m)
Virgin recently acquired by Sprint
(was second largest MVNO with
~2% market share)
Europe (representative sample, not exhaustive):
• Germany, 19%
• Norway, 16%
• Netherlands, 14%
• UK, 13%
• France, 10%
• Denmark, 5%
• Finland, 2.5%
• Czech Republic, 0%

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Operator Focus on Mobile Wholesale
Operators are placing an increasing emphasis on MVNO, driven in part by success stories
“Sprint has more than 100 customers
reselling its network capacity and
plans to increase that number by at
least 10 percent in the next year”
“To expand the reselling business
more rapidly, Sprint has started
offering a broader array of services,
such as billing, marketing support
and competitive analysis”
Matt Carter, President of Sprint
Wholesale Solutions and New Ventures
Wholesale
Retail
Share of Net Adds, Q3 2011
35%
65%
UK
Denmark
US
2.5m 4%
0.7m 14%
19.3m 7%
Country /
MVNO
Subs
Market
Share
Malaysia
1.4m 4%
Example Success Stories

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Trends Impacting MVNO
We see 12 major trends impacting the MVNO industry
Ensuring Success through Evolving
Commercial and Operational ModelsEmerging MVNO Opportunities
7
2
3
4
6
5
Explosion of data and
smartphone adoption
Wi-Fi Offload
Wholesale LTE
M2M
Internationalisation
Roaming
1
Micro-segments enabled
via MVNA
11
8
9
10
Diversification Beyond
Low Cost
MVNO vs. OTT
Evolving commercial
models
Full MVNO Models
12 Data Intelligence
MVNA
MNO
MVNO
MVNO
MVNO

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For a full free copy of this study, or to discuss potential areas of support, please contact us:
Contact Information
Mike Greening
Vice President
mike.greening@cartesian.com
+44 (0) 7739 570829
www.cartesian.com