A Brief Comment On MVNOs

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I saw a story just now saying there are rumors T-Mobile is interested in buying Virgin Mobile UK, and that it’s planning a bid to counter existing bids from cable operator NTL.

The specifics of the situation aren’t really what I’m interested in here, but some general thinking about incumbent operators and virtual ones. Many MVNOs pitch themselves to the public as the anti-operator, offering low costs, simple tariffs, good service and so on — all the things people typically complain about from their operator. There have been several instances of successful MVNOs selling out to incumbent operators. Instead of spending all that money to buy the virtual operators, why don’t the physical operators just act more like them to begin with?

Feel free to explain what I’m not getting in the comments. That’s fun for all of us.

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