There has been speculation recently that Google is already a communications provider, competing for the broadband accounts of a great swathe of customers in the US. It is also playing a game of chess in the payments game, where, according to industry sources it is about to buy the company that rhymed with crisis, ISIS, now called Softcard. The latest evidence of Google piling into the communications space is talk that it is becoming an MVNO.
T-Mobile USA and possibly Sprint are in the frame as the networks favoured by Google.
Not only will the announcement, when and if it becomes official, cause fundamental rumblings in the sector, but it throws up important questions about business models. To date, Google has managed to avoid the dirty business of billing customers, instead favouring the reverse model of funding its business through advertising.
Will it try for the some version of the same model if it becomes an MVNO or will the search giant finally roll up its sleeves and offer some form of billing? If it does, will it, as one might guess, go with the simplest of billing models? Are we going to see flat rate billing make a comeback, or a subscription based model make an appearance, or complex charging and real time functionality? For the first time, the world will be looking closely at how a company is going to bill its customers. And perhaps it will provide a lead for the more ‘established’ telcos who are thinking of changing their business models.
The other thing, of course, is that for a while now we have been discussing whether it is the ‘year of the MVNO’ and also for a while now we have known that BillingViews’ most popular article ever is this one on the five things that make operating an MVNO tough to do right. It seems that this could very well be the Year of the MVNO.
The other issue, of course, is if Google is becoming an MVNO, who else is planning to do the same. Will some car manufacturers commit, will the IoT arena open the door to a whole new wave of specialist ‘MVNO’ companies that will provide the type of connectivity that is needed by different verticals.
The good news is that, in any of these scenarios, except the one where nothing happens and nothing changes, the opportunities for vendors just got very exciting again.
How about Google Fiber? They’ve been billing customers there for a year now, though it’s looking more and more like a sandbox investment, not clear if the prices they charge are enough to sustain profitable service. Maybe the MVNO will help them offer quad-play to folks in KC, Austin, Provo…
Your hunches are generally pretty accurate Mr Behan, thank you.
Not a billing opportunity in the conventional sense of telco billing, I reckon. Complex settlements perhaps; maybe analytics driven arbitrage systems. More generally, soft sim and the untethering of the device from the network will drive similar requirements and a need for clearing and peering. Just a hunch…