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Mobile Section 6: Questions regarding facilities-less service providers

Question 6: Is it a viable business strategy to be a facilities-less mobile service provider as Virgin is attempting?

As we have noted elsewhere in TelecomVisions, the mobile industry has witnessed the emergence of several facilities-less mobile service providers, that is sellers of mobile services who do not own their own networks but purchase mobile network capacity from mobile network owners. Virgin's mobile services in the UK, which run on One2One's mobile network (now owned by Deutsche Telekom) is a case in point.

But will facilities-less mobile service providers be able to compete in the longer run in the same services markets with the very companies from which they are buying network capacity?

Or will the latter, as the suppliers of network capacity, have a decisive cost advantage?

In short, are facilities-less mobile service providers a temporary phenomenon whose days are numbered by the logic of cost and competition?

Or will facilities-less providers be able to use the strengths of their brands and their access to customers to remain in business and prosper?

If you wish to express your views on questions such as these go to the Mobile Workshop. To compare your visions with those of others go to Vision Check - Mobile.