By: Amir Mehmood

The telecommunications industry is no stranger to fast-paced change, but the continued rise of mobile virtual network operators (MVNOs) is now reshaping the mobile landscape at a rapid pace. The global MVNO market was worth $84.6 billion in 2023, and that number is set to jump to $116.8 billion in the next five years, with regions like Latin America, Asia-Pacific (APAC) and Africa now gaining on the US and Europe in terms of MVNO adoption.

MVNOs have become pivotal players in the communications landscape. Instead of investing in network infrastructure, they lease network services from traditional “big player” operators and independently retail and brand their own wireless services. This gives MVNOs a great deal of agility, allowing them to target individual customer segments that are typically underserved by larger operators. Because MVNOs aren’t weighed down by the need to invest and maintain physical network infrastructure, virtually any company can become an MVNO or launch an MVNO-based service.

For instance, Amazon recently made its first foray into this new market opportunity, partnering with US-based operator Dish to offer mobile services that can be bundled with Amazon Prime membership and other benefits. Supermarkets, energy companies, and other retailers are also launching MVNO services that speak directly to their own customer bases. If an energy company launches a mobile service, it can offer unique bundles and benefits that build customer trust and loyalty. But even solo MVNOs can offer unique tariff plans and bundled benefits that larger operators struggle to compete with. For instance, Ting Mobile is an independent MVNO that piggybacks off Verizon’s and T-Mobile’s networks. Its unique selling point is that it doesn’t lock subscribers into any specific plan but instead bills users monthly for the least expensive plan based on their usage. This is a perfect example of the type of dynamic models that MVNOs can bring to the market.

Digital Players in a Physical World

The standout benefit of MVNOs is that they are smaller and more agile than the larger operators they lease network services from. They are also true digital natives, meaning they can tailor their services with a high degree of flexibility and personalization. This requires smart use of their underlying digital infrastructure. MVNOs typically build cloud-native systems, meaning they develop applications or services designed specifically for cloud computing environments. It often involves the use of containerization. Instead of using a monolithic legacy platform to run their business, they use individual “microservices” that are contained in their own runtime environments and mesh those components together using APIs. Where a legacy non-cloud-native business might have to tear down an entire building to add upgrades and extensions, a cloud-native business will be able to swap bricks in and out without impacting the structure's overall integrity. In other words, cloud-native businesses enjoy a faster time-to-market for new or upgraded services without downtime.

However, this begs an important question for aspiring cloud-native MVNOs. They must choose the right digital infrastructure model to support their services. Do they opt for a multi-tenant MVNE (Mobile Virtual Network Enabler) hub or go for single-tenant infrastructure? The choice isn’t just technical; it has implications for overall business strategy, market positioning, and long-term scalability.

The Difference Between Single-tenant and Multi-tenant Infrastructures

To understand which approach might benefit an MVNO, it’s first important to understand the key differences between the two options. Single-tenant infrastructure is a bit like renting your own family home. You have complete control over your space, can customize it to your liking, and can enjoy privacy without the concern of sharing your space with others. Translated to MVNO terms, this means having a dedicated infrastructure solely for one MVNO. It offers greater control and customization options but typically comes with higher costs and maintenance responsibilities, not to mention the time it takes to negotiate the lease, move all the furniture in, set up utilities, and so much more. Time is not on your side.

On the other hand, a multi-tenant infrastructure is more like an apartment building with several units. Each unit is independent, offering some degree of privacy and control, but tenants might have to share communal facilities like laundry rooms or kitchens. In the MVNO world, this translates to sharing key infrastructure resources with other MVNOs. It is cost-effective and less burdensome in terms of maintenance, but it might limit how much each MVNO can customize its portion of the shared infrastructure.

Now, let’s look at each scenario in greater detail to better understand the choice facing both new MVNOs and MVNOs already in the market and consider a fresh approach.

The Pros and Cons of Multi-tenant MVNE Hubs

Multi-tenant MVNE hubs are a compelling option for many MVNOs, primarily due to their cost-effectiveness. By sharing infrastructure resources, MVNOs can significantly reduce their operational expenses. It's an efficient use of resources in terms of physical infrastructure and the underlying technological framework, often cloud-native, which ensures scalability and adaptability. For MVNOs looking to enter the market quickly or expand their services without heavy upfront investment, multi-tenant solutions offer an accessible path.

However, this model isn't without its challenges. Data privacy and security emerge as primary concerns, as sharing infrastructure inherently means sharing the underlying network and systems. While each MVNO has its private “apartment” within the larger “building,” the shared nature of the infrastructure could pose risks if not managed