D’Amp’D & The Troubles Awaiting MVNOs

6 thoughts on “D’Amp’D & The Troubles Awaiting MVNOs”

  1. Hmmm, smells like old (worldcom) times.

    MVNO’s are Sprint’s way of doing EXACTLY what the MCI CFO did, ie. capitalizing operating costs. (Just see today’s buy of Alamosa PCS)

    One of the lessons for the dotcon bubble is that even 95% of wall street either can or won’t do any real math, just follow the money for christ sakes.

    One thing that these deals reveal, and that nobody has really written about (Om!!!) is the industry’s great lie, the scarcity/value of spectrum.

    MVNO deals, be definition, signal a massive OVERSUPPLY of spectrum.

    So, for years the industry has blamed blocks and drops on the “scarcity” of spectrum.

    Bullshit.

    The only scarcity in this business is capital, and the clowns that run the wireless industry invested way too much money, and have been in CYA mode for some time now.

    Hence, MVNO’s, ie. outsourcing the CPGA, only to buy the subs back as a capitalized asset.

    Now Om, ask yourself what happens to industries with massive oversupply, as opposed to overdemand ala Oil?

    What is now happening in wireless is all smoke and mirrors.

    Until the WS debts are paid off, this industry will continue its disinformation campaign of how “competitive” it is, when in fact its completely anti-competitive, as the top 3 carriers have cornered the spectrum market, hording it, but not because of its inherent value, but to block new entrants.

    PS. Watchout for moves from King Ed, wrt to more control over Cingular, err ATT Wireless, next year.

  2. A targeted MVNO Movida seems to be doing well in Texas, California and Florida markets targeting growing Hispanic population, their main attraction are low calling rates to mexico and latin america rather than low rates to rest of US. My personal experience talking to a few folks on Movida service supports my claim.

    Again these are the folks who would otherwise have found it hard to get a moile fone connections through major carriers (reasons: lack of residency, credit etc)

    The demographic, coupled with geriatric shift in US population make hard to be convinced about success of MVNO’s in long run!

    Maybe there is a market for an MVNO targeting the old folks who want a plain vanilla voice phone and rock bottom rates!

    Having observed cell phone usage behavior around the world, I see some stark differences in patterns eg. SMS text messaging; though MNVO’s tout text messaging as a killer app. few folks in the bubble gummer/teen population seem to use it in the US (in terms of percentage). Things as basic as SMS haven’t taken off in a big way, I wonder what applications the MVNO’s should have that will bring in customers’ in droves!.

    Another point to note is the MVNO billing problems that never seem to go away!

    Ciao!

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