A report by investment bank Goldman Sachs JBWere stating the New Zealand Mobile Virtual Network Operator (MVNO) market has made little progress since the beginning of the year is being panned as “astounding” by operators.
Johnathan Eele, CEO of MVNO Black+White, which is presently beta testing its service, says the report makes “emotive statements” and doesn’t reflect the current state of affairs in the market.
In the report, which doesn’t mention Black+White, Goldman Sachs JBWere analyst Tristan Joll slates the country’s fledgling MVNO market as “immature” and the efforts of contenders in it as “impotent”.
Eele says that on the contrary, in a market that has so far only seen a “two-horse race”, an MVNO stands the best chance of bringing in the changes customers want.
“We have done our research and found a great deal of pent-up desire with customers to have change,” Eele says.
Citing the Australian market as an example of where MVNOs have succeeded, Eele points to Virgin Mobile that was eventually taken over by Optus, its wholesaler. Eele’s Black+White is working through Australian telco M2 that handles billing and support for the MVNO.
Calling the MVNO acronym “bloody awful”, Eele says there’s nothing remarkable about the business model.
“Hotel operators do not own the rooms in the hotels themselves,” Eele says. “Why is everyone so het up about who owns the underlying infrastructure of service providers?” he asks, and claims the telco industry is no different from other businesses in this respect.
The GSJW report considers Orcon to be the most credible player in the MVNO space. Asked if he believes MVNO market development in New Zealand has been relatively slow, Orcon CEO Scott Bartlett says “There are no MVNOs operating or about to operate in the NZ market to my knowledge as the wholesale propositions that have been talked about haven’t launched yet, so I don’t know what ‘development’ the report suggests.”
Joll says the report he wrote was a market update for the wireless market, looking back at February to see what had happened overall since then. There’s no suggestion that MVNOs are “impotent” as such, Joll says.
He was not aware of Black+White, but says it’s not his job to publicise start-ups. Joll says that MVNOs are “a great idea for all concerned” when asked if entering the wholesale market benefits existing telcos with network infrastructure. Anything that leverages investment is good, Joll says.
The report was clearly written before the MVNOs came to market, says Vodafone’s corporate affairs boss, Tom Chignell.
“TelstraClear has launched on Telecom’s network and Black+White is launching on Vodafone’s. “We have more MVNO partners preparing to launch; we have a new wholesale team that is discussing other opportunities and the telecomms marketplace is as dynamic as it’s ever been.”