In this article, you’ll learn:
- Why AltNets are exploring MVNOs as a route to growth.
- How mobile can increase ARPU and strengthen customer relationships.
- Why fixed-mobile convergence is becoming harder to ignore.
- What makes an MVNA model attractive for AltNets.
- How Gamma can help AltNets move from broadband-only to a broader mobile proposition.
Alternative networks (AltNets) have spent years building the fibre foundations for faster, more competitive broadband. But as the market matures, the growth challenge is changing.
The next opportunity is around increasing the value of existing customer relationships. That’s where mobile starts to matter.
It’s a topic covered by James Gray, MD of Graystone Strategy, and Sam Burckhardt, Business Development Executive – Service Provider at Gamma Communications.
As Sam explains, many AltNets have already built their core broadband proposition, with home phone and TV often sitting alongside it. Launching a mobile virtual network operator (MVNO) is ‘the natural next step that lots of these AltNets are looking at.’
What is an AltNet?
AltNets are network providers that offer broadband connectivity outside the traditional incumbent network model. Many AltNets have focused on fibre rollout, but are now looking at additional services such as mobile.
Think of them as ‘the challenger brands to your BTs, your Virgins, your Skys.’ Their focus on fibre optics allowed them to ‘differentiate themselves’ through better connectivity and a higher quality of service.
It leaves AltNets with a more loyal customer base. That loyalty is the driving force behind future AltNet success.
Why are AltNets interested in MVNOs?
Major network providers already operate through a ‘quad play of products.’ Broadband, home phone, TV and mobile are all bundled together into one convenient offering.
AltNets have already built customer relationships through broadband, with home phones and TV acting as secondary products. If AltNets want to compete with major providers, as well as with other AltNets, they need to be furthering this multi-play proposition.
For Sam, the market is shifting away from a ‘build it and they will come’ mindset to one of customer consolidation. Growth through new connections will slow, meaning AltNets must find new ways to build revenue.
That’s why mobile is due its ‘moment in the sunshine.’
How can mobile help AltNets increase ARPU?
Broadband connects a household, but mobile connects the individual. This creates, as James highlights, a ‘significant multiplier effect.’ One fixed broadband customer could become multiple mobile relationships.
Consumers can pay as much as £45 a month for gigabit-capable services. Adding on mobile means there’s ‘more revenue up for grabs.’ AltNets can nearly double their ARPU by adding mobile services to an average household of 2.2 people.
To summarise:
| Existing relationship | Mobile opportunity | Commercial impact |
| One broadband connection into a household | Multiple mobile users in the same household | Higher ARPU potential |
| Fixed data at home | Mobile data away from home | Broader customer relationship |
| Broadband-only provider | Multi-product connectivity provider | Stronger retention and differentiation |
Why does customer stickiness matter for AltNets?
When customers take more products from one brand, they tend to stick around for longer. While James does describe it as ‘entanglement theory’, it’s not as complicated as quantum entanglement. Albert Einstein wouldn’t be calling it ‘spooky at a distance.’
If customers receive broadband, TV and fixed connectivity from one brand, the chances of them leaving ‘are much diminished.’ Again, it gives AltNets the chance to expand on this multi-play proposition.
From this one relationship, customers gain more value, more integration and more convenience. Their willingness to stick with one brand increases once an AltNet chooses to diversify its portfolio. These AltNets are the ones creating upsell and cross-sell opportunities that generate more income.
Why is fixed-mobile convergence becoming a strategic issue?
AltNets are having to compete against providers that already offer broader bundles. Their multi-product offering is the foundation for boosting customer retention.
From previous research, James notes how 74% of customers are open to buying multiple services from one provider. AltNets need to consider how they protect their relationships and avoid being outplayed by larger competitors.
This has created a ‘virtuous circle.’ It makes ‘good commercial sense’ since customers want it to happen and AltNets can drive ‘a stickier product.’
Adding mobile allows AltNets to:
- Protect their customer relationships from incumbents.
- Increase household value through a broader connectivity proposition.
- Move from broadband challengers to multi-product connectivity providers.
Why haven’t more AltNets launched mobile already?
If the opportunity is strong, then why hasn’t everyone done it?
Launching an MVNO isn’t as simple as adding a new tariff page. AltNets need network access, commercial agreements and the right support network in place to keep things running. That’s why they turn to the experts to make their MVNO a reality.
AltNets have two choices:
- Work with a mobile network operator (MNO), such as O2 or Vodafone.
- Work with a supplier that already has existing MNO relationships.
Who should AltNets be launching MVNOs with?
Working with an MNO is seen as the more traditional route. The alternative is to align with a mobile virtual network aggregator (MVNA) or a mobile virtual network enabler (MVNE).
Sam describes how MNOs are only interested if brands ‘can deliver significant sums.’ They’re looking for ‘a million-plus connections’, which is certainly easier said than done.
Working with MNOs can come with strict revenue commitments, inflexible commercials and a higher technical barrier to entry. James also mentions how MNOs ‘don’t have the ability’ to set up smaller organisations. This is why MVNAs and MVNEs were able to enter the market.
Large-scale organisations with major volume commitments would be better to pursue a direct MNO agreement. AltNets are better suited to work with MVNAs as a more practical route into mobile. More consultancy-led support can help shape the proposition and perfect the go-to-market (GTM) strategy.
What should AltNets look for in an MVNO partner?
AltNets should assess whether a potential MVNO partner can:
- Support mobile access through established MNO relationships.
- Create realistic growth without excessive upfront commitment.
- Simplify integration and provisioning.
- Shape the proposition and support both eSIM and physical SIM use cases.
- Build deeper customer relationships without undermining existing reputation.
- Scale effectively as subscriber numbers increase.
What matters here, for James, is trust. AltNets are heavily dependent on their customer base, meaning trust and reputation need to be maintained.
What does the future look like for AltNet MVNOs?
James mentions the ‘huge opportunity in the AltNet sector.’ In his eyes, the next 18-24 months could see a succession of AltNets coming to market with ‘some sort of mobile partnership or mobile proposition.’
While it might be equivalent to ‘London buses’ in which 3 or 4 will come at once, the fact remains that AltNets have an incredible commercial opportunity through MVNOs. Utilising existing customer bases and developing a multi-play proposition should be high on the AltNet agenda.
Working alongside an MVNA like Gamma can help deliver that reality.
A consultative approach, combined with structured onboarding and customer-centric support, gives AltNets the foundations required for an MVNO. Our experts manage the technical relationship with the MNO, with advice readily available throughout every aspect of the GTM approach.
AltNets don’t need to become traditional mobile operators. They just need to decide whether an MVNO has a role in the next phase of their customer proposition.
Quick Answers: Why AltNets are Turning to MVNOs to Grow Beyond Broadband
What is an AltNet?
An AltNet is an alternative network provider that competes with incumbent broadband providers.
Why are AltNets interested in MVNOs?
AltNets are interested in MVNOs because mobile gives them a way to grow beyond broadband, increase customer value and strengthen customer relationships. The AltNet market is moving from network buildout towards customer consolidation, making new products more important for revenue growth.
How can mobile increase ARPU for AltNets?
Mobile can increase ARPU as it lets an AltNet sell services to individuals within a household, rather than just the premises.
Why does mobile improve customer stickiness?
A mobile proposition allows customers to buy multiple services from one provider, meaning they’re less likely to leave.
Should AltNets go directly to an MNO?
Some AltNets may explore direct MNO relationships, although MNOs are generally less interested unless organisations are ready to meet high commercial returns.
What is the role of an MVNA?
An MVNA acts as an intermediary between an MNO and MVNOs, helping simplify access to network services.
Why work with Gamma for MVNO enablement?
Gamma has existing relationships with many AltNets through home phone solutions, which creates existing trust. A consultancy-led approach guides AltNets throughout the GTM process while managing the technical relationship with MNOs.
