O2 is planning to expand its MVNO business by offering a range of digital services such as O2 Media and O2 Wallet in bespoke form to suit the requirements of its partners.
In an interview with Mobile, O2’s MVNO chief Magnus McDonald said the plans fit in with the operator’s strategy of ‘evolving its mobile business’. He aims to extend its MVNO business beyond traditional mobile to other digital services.
Pointing to Tesco Mobile, O2’s largest MVNO, as an example, McDonald (pictured) said it was ideally suited to using an adapted version of the O2 Wallet.
He added: ‘Tesco Mobile could have a mobile wallet Clubcard giving customers certain advantages when purchasing certain products. The options are almost endless and can be tailored to any kind of business.’
McDonald said he felt the operator’s unique selling point in the MVNO market was its direct relationship with its MVNO partners. Unlike its rivals O2 does not use an aggregator to set up and manage its MVNO partnerships. O2 currently has four MVNO partners – Tesco Mobile, Lycamobile, Manx Telecom and giffgaff.
McDonald said: ‘Our MVNO business is focused primarily on partnerships. By selecting the right partnership we can be much more successful and make sure we bring to bear all the capabilities of Telefónica to help our partners grow.’
He argued that MVNAs can dilute the relationship an operator has with its MVNOs. ‘The problem with aggregators is they are incentivised to sell as much network as they can and immediately lose the selective nature and focus a direct relationship brings.’
McDonald said both Lycamobile and Manx Telecom act as MVNAs on occasion, ‘in particular fields they understand better than us’.
He refused to rule out O2 using MVNAs in the future, saying: ‘I would never say never since this market is very fluid. That would depend on how, for example, LTE develops and the market in general. So we will continue to review that policy but we don’t require an aggregator at the moment.’
Looking forward, McDonald said O2 was examining MVNO opportunities in a variety of markets including the retail, e-tail, gaming, content services, media and automotive markets.
He declined to reveal whether O2 had any new MVNO deals in the pipeline, and said its strategy was more about the quality of its MVNO partnerships rather than the quantity. He added: ‘We are very much open for business but we are very, very selective about who we partner with.’
Mobile revealed last month that the Post Office is the latest major company to explore rolling out an MVNO. When asked if the operator would pitch for the business, McDonald said: ‘We have met with and been speaking with the Post Office for years and we are very interested in what they want to do.
‘It’s a phenomenal brand and if it can execute an MVNO with a brilliant, clear strategy then it could be very successful.’