Renna Mobile eyes overseas expansion
MVNO keen to expand operations after breaking even in Oman
Majan Telecommunication, which operates an MVNO in Oman under the Renna Mobile brand, hopes to launch more operations in the Middle East and Africa after reaching break-even point in its home market in June.
Renna launched operations in Oman in May 2009 having secured a wholesale agreement with Omantel and a Class II mobile reseller license from the country's telecoms regulator, making it the country's second MVNO after Friendi Mobile, which launched one month earlier.
Joakim Klingefjord, CEO, Renna Mobile, described reaching break-even as a "milestone" for the operator, which he said has almost 200,000 subscribers.
"We reported our first full month of operational positive cash flow on our operation in Oman. This is obviously a crucial milestone for us since we are able to show to our shareholders, employees and other stakeholders alike that the MVNO model actually does work in this part of the world," he said.
Klingefjord told CommsMEA that as the company moves towards profitability, it is also considering plans for expansion in Oman and the wider region.
"We are in discussions now to look at launching in other markets, since we see the business model is working in this region. We are looking to launch more operations in other countries in the region," Klingefjord said.
He added that the company is looking for investment partners with telecom experience to expand in the region. "It has a positive effect if they are a telecom investor because they know the business models, so it helps the execution in the market," he said.
Klingefjord said that countries including Saudi Arabia and Egypt have significant potential, although the company is in discussions regarding various markets across the Middle East and Africa.
"We have some interesting discussions going on with international players and are really keen to get in touch with operators and other industry players alike," he added.
Oman became the first country in the Middle East to grant licences for MVNOs in 2008. As of March 2011, Oman's resellers had an 11% market share of the country's total mobile subscriber base, or about 11.6% of the pre-paid subscriber base, according to Oman's TRA.
Mikkel Vinter, CEO of Friendi Mobile, said that his company held 6% of the MVNOs' market share as of March 2011, while Renna claims a current share of about 3.5%, which would give the remaining MVNOs a combined market share of about 1.5-2%, depending on growth of the overall MVNO market.
Ignacio Couto, associate director at consulting firm Neoris ME, said that Friendi and Renna appear to be the only two MVNOs that remain active in Oman. Couto said that Samatel, which launched operations in August 2010, had switched to an MVNE (mobile virtual network enabler) model, while all of the other remaining MVNO licencees have "effectively given up".
Samatel was also awarded a full operator licence by Oman's TRA earlier this year, casting further doubt on the company's plans to continue expanding in the MVNO space.