Building an MNO is Very Difficult

Management · Technology · Solutions · Leadership

Building an MNO from scratch comes with quite a few regulatory obstacles, technical complexities and financial hurdles to overcome.

The decision to start a new mobile network operation is a tremendous obligation and without the necessary resources in place will very likely not succeed.  Regulations, competition, finances and complexity pretty much sum up the obstacles you will face when building out your own physical mobile network.  Building the right team and having a clear business target will make all the difference.

Regulations

By definition, a consumer-level wireless carrier provides last-mile service; which requires at least one cellular tower, a spectrum license, network identifiers, and the appropriate radio and network equipment to provide service to customers within range of your towers.

As with most public services, access is regulated.  Specifically in this case, tower locations are regulated.  Spectrum is regulated.  Network identifiers and line ranges are regulated.  Radio power and coverage are regulated.  If you would like your customers to be able to roam on other networks or would like the roaming revenue from other network providers on your towers then there are more regulations to work through.  All in all there is an enormous amount of bureaucracy to navigate in order to acquire and certify these resources.

Radio Spectrum

The real blocker is radio spectrum.  There is only so much spectrum available and the largest carriers of each country have the resources and the lobbyists to control the vast majority of the available frequencies.  Some governments have made provisions within spectrum auction rules to allow smaller players a chance, but by and large the big carriers control the show.  If your need requires a large spectrum coverage area, then come prepared with a lot of cash or an innovative revenue share concept.  Otherwise, leasing spectrum frequencies from a spectrum broker or one of the larger carriers might be your only option, so plan your P&L appropriately.

Competition  

As we learned in the previous section, the acquisition and control of wireless spectrum frequencies is one major example of industry competition.  Other areas of concern for the new cellular provider include access to cost effective network equipment and resources, skilled telecommunications talent, constantly evolving standards bodies (controlled by the largest carriers and equipment providers) and obtaining consumer mobile equipment at cost effective rates.

If your business model includes support for service roaming, then identifying and partnering with other networks cost effectively will be another challenge.  The GSMA will provide a general framework and support for starting a dialog with other providers, but to be truly effective you will need a solid business model to get the best rates.  As with most service agreements, volume drives price, so come prepared with realistic forecasts and the confidence to hit minimum service levels to get the most disruptive rates.

Complexity

The last major hurdle to overcome is complexity; which starts at the point a connection is made at the tower and ends when a consumer bill is generated or roaming charges are reconciled.  Making everything in between work effectively requires considerable planning and knowledge to be successful.

There is so much that occurs within mobile network operations, and so many different ways of implementing, it really becomes a case-by-case scenario dependent upon the targeted business objectives.  

Functional Complexities to Consider

Operations Support

  • Provisioning Portals and APIs
    • Subscriber management
    • Usage and access controls
    • Rating and charging rules
    • Data throttling and limits
    • APN and data routing
    • Roaming partner configuration
  • Administrative Systems
    • OCS interfaces and billing proxy
    • Usage auditing and reconciliation
    • Device and line management

Technical Functions

  • Mobile device to radio protocols
  • User session management and security. 
  • Tower to tower session handoff 
  • Subscriber registration management
  • Roaming authorization
  • Voice, VOIP and VoLTE support
  • SMS and MMS support systems
  • Packet core signaling and gateways
  • Usage policy and charging rules
  • IPX/GRX roaming interconnects
  • uSIM/eSIM configuration

Business Support

  • Usage mediation, rating and metering
  • Wholesale and consumer billing
  • Service line price plan configuration
  • Service line network features / options
  • Account and line management
  • Audit reporting and reconciliation
  • Financial and data roaming settlement
  • Realtime metering and usage controls
  • Customer service administration
  • SIM profile management
  • IMSI / MSISDN / IP range management

Building a full-fledged cellular network from scratch is a very daunting, expensive and challenging undertaking.  It is imperative that any team attempting a new build have a well balanced skill set with real experience and knowledge of telecommunications operations, technical systems, their local country’s regulations and the mobile industry in general.

Only those with a clear ROI and the necessary resources will be successful…

AVEMAC CONSULTING | Business Solutions | Mike Schmidt | Founder | Consultant | Executive | Engineer

Mike Schmidt

Founder and CEO

"After decades working as an executive leader and solutions architect for corporations, small businesses and startups, I founded Avemac Consulting to share this knowledge and to build a first class team of consultants dedicated to helping companies solve their most difficult problems, develop innovative services and plan their future growth initiatives."

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