It seems to me that you need billions of dollars and many years to build a major infrastructure to provide nation-wide cellular service. Now new mobile phone companies are appearing overnight. Companies like Virgin Mobile, STi Mobile, Boost Mobile, Tracfone, and Net 10 have already claimed millions of subscribers. Right on their heels even more new companies like Helio, Amp'd, ESPN Mobile, and Disney Mobile are set to launch in 2006.



Welcome to the era of the Mobile Virtual Network Operator or MVNO. A MVNO buys airtime from a major wireless provider and turns around and sells its own branded phones and services. They've been around in the United States for a few years, mostly as pre-paid companies. But now suddenly, they're hot.

Virgin Mobile is the largest MVNO in the U.S., using the Sprint network and targeting the hip youth market. One of the reasons for the more recent larger scale success is that US mobile carriers are now willing to accommodate MVNOs more aggressively.

Previously MVNOs just remarketed cellular services under their own brand, but now a new wave of what I call Muscle-MNVOs are not only using the major carriers network, but are providing new value add-ons. STi mobile utilizes their international calling card network to allow for cheap direct dial international calls from their phones while using Sprint as a backbone. Boost Mobile and Ampd Mobile are providing multi-media downloads. ESPN Mobile and Disney mobile will provide exclusive media capabilities as well. Helio, a joint venture between SK Telecom (Korea) and Earthlink.net, will take its already successful Korean muscle phones, muscle media, and muscle services model from Korea and introduce it here in the United States. I think these guys are very interesting.

Why are most of the major US mobile companies finally welcoming MVNOs (because many did not in the past)? It is because much of the main stream plan subscriber base is saturated, but the growth opportunities for MVNOs marketing in the prepaid markets, youth, and specialty areas is huge. The Yankee Group, a technology research firm, projects that mobile virtual network operators will generate $11 billion in service revenue by 2010, up from $1.9 billion last year.

Sprint has been the most aggressive MVNO service provider. Let's hear it for Sprint. I hope they are rewarded highly for their support of competition and creativity in the Mobile Marketplace.