Market Dilligence

For Wholesalers, Wireless Wins and Losses Becoming a Game of Innovation

New wholesale survey results from ATLANTIC-ACM reveal that approximately 30 percent of customers executing wholesale purchases also offer wireless services to their end users. Further, among the seven in 10 that do not, nearly 90 percent indicate they have no future plans to deliver wireless services, suggesting that new prospects for wholesale services from wireless providers will be few and far between. Of the few service providers with future plans, half expect to start an MVNO while the other half will go the resale or white-label route. However, among wholesale customers already providing wireless services, 42 percent expect to increase spending over the next 12 months (down slightly from last year), while only 17 percent expect a decrease, signaling growth opportunities from current buyers.

Looking deeper into current buyers of wholesale services, in both the 2012 and 2013 surveys, MVNOs on average expect see their spending remain flat or decline while resale providers expect double-digit increases in spending. Projections of increased growth in wholesale spending somewhat dovetails with reports of resale subscriber growth from wireless wholesalers, with Sprint increasing wholesale and affiliate subscribers 13 percent year-over-year, AT&T achieving nine percent year-over-year growth in reseller connections, T-Mobile booking a 17 percent increase in MVNO customers and 21 percent increase in branded prepaid customers, and Verizon reporting a million additional subscribers via an MVNO using the Wal-Mart sales channel.

Looking forward, new opportunities for wholesalers to serve the wireless space could potentially come in two forms. First, within the traditional service provider market, wholesalers need to focus on enabling their customers in the delivery of retail bundles and single-vendor solutions. Internally, this means wholesale providers need to move away from traditional, telco-oriented wholesale customer segmentation (ILEC, CLEC, etc.) and reevaluate the needs of wholesale customers based on the retail segments they serve in a modern marketplace colored by bundled, integrated and/or vertical solutions. This involves changing the conversation from traditional wholesale products and services to solutions that meet the needs of bundled service providers.

Finally, as few new service providers plan to roll out wireless services, selling integrated wholesale solutions into non-traditional wireless service models will be key to new growth opportunities. Strategies for making this leap may range from bringing people to the discussion table that historically have not been included in wholesale conversations (think: representatives from key retail industry verticals or segments) to providing new methods for marketing and distributing mobile solutions.

This article originally appeared at B/OSS / Vision2Mobile.

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