Released on: June 3, 2008, 3:51 am

Press Release Author: Aileen Brucal

Industry: Telecommunications

Press Release Summary: US mobile market set to change significantly in 2008, with a
move of the incumbents towards flat voice tariffs. InfoCom's research shows how this
trend is different from happenings in Europe.

Press Release Body: In some countries the MVNO market is starting to become already
as mature and in some cases MVNOs are even disappearing after a successful business
cycle - at least for some of them.

Though in Spain, this market moves rather slowly: from the first symptoms of market
interest until the point at which MVNOs become established, more than 6 years
passed. And to catch up on the time lost, it seems that Spanish companies find their
own way to bridge the time gap by rebranding existing companies as MVNOs. This is
what happened with Yoigo - an established mobile carrier with license for 3G - and
Euskaltel, the local telecom carrier of the Basque region, offering mobile services
since 1999.

The remaining part of the Spanish mobile market seems also to show rather peculiar
characteristics; and its players can be grouped as follows.
. The Cheap Boys (or the Bubble Waiters), with creative business models, such
players drop tariffs in the hope to quickly push their subscriber base, impacting
massively their business model. This at the risk of not making a profit.
. The Surprise team, the only group, perhaps, that is acting on the base of their
current REAL business and with clear investments plans. They are niche-oriented, for
instance targeting market segments such as business customers or ethnic groups,
pushing data services, using advertising. The market is waiting to see if such
models work.
. The Big Players, for instance retail chains such as El Corte Inglés. The retail
giant was quick to sign a contract with Telefonica's mobile arm Movistar - 3 years
ago, though the service is still on a "Coming Soon" stage. However, establishing and
running a MVNO takes less than 6 months.
. The Mobile Network Operators (MNO), providing the radio interface to the MVNO. In
Spain, all MVNOs have to sign a contract with a MNO (Movistar, Orange or Vodafone).
MNOs cooperate with emerging MVNOs although sometimes the question is who is in
charge.

Despite a jungle of interdependencies among MNOs and MVNOs, the market seems to be
eventually developing positively. The industry shows a lot of activity, with a
market, which could possibly allocate even more players and shows bright prospects,
with some changes due to happen early next year. Still the size of the market for
MVNOs could represent only a small niche. Keeping numbers in mind: with 47.7 million
mobile subscribers in Spain at end-2007, as trends at world level estimate a 3.6%
MVNO penetration in average, this means 1.7 Million MVNO subscribers. These numbers
seem to indicate that, for Spanish MVNOs, a feasible target, in average and
according to the different business cases, could be around 400 000 subscribers each.

About this research
This is part of a larger project that recompiles the analysis of best practises
regarding business plans of MVNOs. Some concrete cases of organisations' strategies
are presented along with the offers they launch onto the market and how new ideas
actually turn to new business opportunities.

About tx soluciones
tx soluciones is a consultancy company, which provides telecom consulting and
solutions in all emerging and traditional telecom sectors, supporting its clients
through a complete product portfolio with market research, feasibility studies,
elaboration of business cases and business models as well as project deployment. tx
soluciones is active in Spain and in Latin America.

About InfoCom
InfoCom is a market research and consultancy company with 20 years experience
providing strategic analyses and planning assistance to stakeholders in the
telecommunications, IT and multimedia industries. InfoCom's independent and
fact-based analyses highlight trends and opportunities, supporting decision makers
to understand market dynamics in order to improve their competitive advantage.
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