• Opensignal surveyed customers of ‘brand MVNOs’ and their host mobile networks in seven markets, including the UK and US
• MVNO users are prepared to accept slower speeds for lower costs
• The MVNO market remains buoyant, with a recent uptick in activity in Europe

A new report has provided some insights into why mobile virtual network operators (MVNO) are continuing to attract more and more customers even when their service performance metrics are poorer than those provided to customers served directly by the host mobile network operators (MNOs).

According to network performance analyst firm Opensignal, customers of what it terms standalone or ‘brand MVNOs’ – owing to their affiliations with big non-telco brands like retail chains – generally observe slower download speeds than their counterparts on host MNO networks (see chart above). 

However, Opensignal’s research found that cost trumps speed for MVNO users, particularly in the US – the firm’s US Household Survey shows that MVNO customers are significantly more cost-conscious than MNO subscribers, with speed and network quality mattering less than affordability.

The report is based on a survey of MNO and standalone MVNO customers in Brazil, Germany, Japan, Mexico, Italy, the UK, and the US (but excludes MVNOs owned by network operators, such as MNO sub-brands). The survey focused on mobile network customer experience metrics. 

One of the broader findings is that MVNOs are consistently gaining more subscribers than they lose, unlike MNOs. Here, Opensignal counts subscribers that switch operator while retaining their existing mobile device. 

Chiming with these findings, Kester Mann, an analyst with research firm CCS Insight who closely tracks the MVNO market in the UK, noted in a recent blog that the number of customers using virtual providers in the UK “jumped 8% in 2024 to almost 18 million”, compared to a 1% fall among the four MNOs (BT’s EE, Three UK, Vodafone UK, and Virgin Media O2). 

Notably, the imminent merger of Vodafone UK and Three UK, which will reduce the number of network-owning UK operators from four to three, has also thrust the MVNO market into the spotlight over wholesale competition fears. This led to the imposition of a three-year guarantee on MVNO wholesale terms by the Competition and Markets Authority (CMA).

Meanwhile, Opensignal also reported that while data speeds might differ, service reliability is comparable for MVNOs and MNOs, while MVNOs such as BAIT (a subsidiary of multinational retail giant Walmart) in Mexico or iD Mobile (a subsidiary of tech retail giant Currys) in the UK benefit from broad distribution networks. “This can be achieved through retail partners, loyalty ecosystems, or brand visibility to attract and retain subscribers,” observed Opensignal. 

New MVNO movers in Europe

The report is timely as it coincides with a recent flurry of activity in the MVNO market. For example, fintech firm Revolut, which has 50 million customers around the world for its financial services and applications, is entering the mobile services markets in Germany and the UK as an MVNO. The move follows the success of the company’s eSIM offer, which was launched last year in the UK.

According to Mann, since the Revolut service will only be offered over eSIM, the “company’s timing appears shrewd as rumours persist that Apple’s next iPhone could include an eSIM-only variant for European markets.”

There has also been speculation that popular UK utilities firm Octopus Group is set to launch its own MVNO. Mann said such a move would make sense since the company would benefit from an existing base of close to 13 million households.

“Having brought disruption to the energy sector, it may feel confident in shaking things up in mobile. In particular, it has carved a reputation for good customer service, something that has often proved an achilles heel in telecommunications. It also has some telecom experience through subsidiary Fern Trading, including retail service provider Cuckoo Broadband,” he commented.

Mann also noted that MVNOs tend to perform best during periods of economic uncertainty “as their discounted mobile offers resonate with people looking for a better deal. Currently, MVNOs represent almost 20% of all mobile subscriptions in the UK (excluding machine-to-machine connections), up from only 12% a decade ago”.

- Anne Morris, Contributing Editor, TelecomTV