EE, Argos, Sky and TalkTalk are all tipped to bid for Phones 4u’s MVNO, Life Mobile, which has gone into administration alongside the rest of the Phones 4u group.
EE is deemed the favourite since it was Phones 4u's MVNo partner on the Life Mobile deal.
Phones 4u administrators, who were appointed by Price Waterhouse Coopers yesterday, have made clear that finding buyers for the Phones 4u business including its MVNO is their primary option.
Argos is considered another front runner for the MVNO by MVNO industry insiders. The retailer has clear ambitions in the mobile space. Last year Mobile revealed the retailer was in exploratory talks with operators about launching its own MVNO. It was also in talks with Phones 4u this summer about inking a retail partnership which would have seen Phones 4u concessions opening in Argos stores.
One mobile executive said: ‘Argos needs to get into the mobile arena for several reasons, not least because pre-pay sales have fallen. It was in talks with Phones 4u but obviously that has come to nothing. Phones 4u’s MVNO would offer it a very easy way of launching its own MVNO.’
Sky is considered a strong contender. The media giant has long been tipped to launch an MVNO. Analysts say the need to enter the mobile market has become much more pressing for Sky as competition from BT on the quad-play front increases.
TalkTalk is also on the cards as a potential bidder. The telecoms company already has an MVNO with Vodafone. TalkTalk added 24,000 new mobile customers during Q1 this year, taking customer numbers to 308,000.
One MVNA source said: ‘Sky has been looking to come into mobile for many years and now may be the right time to do so. They are facing competition from BT and the opportunity is there with Life Mobile on offer.’
Phil Kendall, director of global wireless, at Strategy Analytics said: ‘All three have their obvious motivations.
'Sky has always said it has no imminent plans to enter mobile but Sky said that about broadband and fixed line right until launch. Virgin is doing really well in mobile and BT is getting into the game now, so do Sky start to look weak from that perspective?
'As for Argos it very likely could follow the example of other retailers in tapping into their customer base with an MVNO. That would be a logical step.’