Should Facebook Become a Mobile Service Provider?

By

You’ve heard complaints for years from telecom executives that third-party app providers build businesses on the back of telco-provided access services, but that the access providers do not share in the revenue created.

Now you have the reverse being argued, that application providers such as Facebook create huge value for telos, but do not participate in the access revenue stream.

In other words, nobody is ever completely happy with their share of ecosystem revenue. Strand Consult speculates on whether Facebook is willing to look beyond advertising as a source of revenue, and whether Facebook would become a mobile virtual network operator – as a way to create a new revenue stream, as well as to recapture some of the value it believes it is creating in the ecosystem.

As some have speculated about the value of Facebook creating its own branded smartphone, Strand Consult now speculates about the value of Facebook becoming a service provider.

Becoming an “MVNO is a logical step for Facebook the world’s largest communication platform,” Strand Consult analysts argue.

One billion users already consider Facebook as their de facto telephone book for friends and family and use the platform for communicating by SMS, text, image and video, according to the firm.

So adding mobile voice and data wouldn’t be completely odd.

Aside from its huge user base, Facebook has credit card credentials on file already for millions of its users, many of whom purchase premium games, driving one-sixth of Facebook’s revenue.  

Facebook could offer mobile SIM cards online, and there are a number of companies than can provide the billing and fulfillment.

If the mission of the company is to “help the world connect,” you can see the resonance of Facebook as a mobile service provider. By launching an MNVO, Facebook could become the world’s largest mobile operator, allowing its users to connect via voice, and make the money its investors demand.

How much could Facebook earn as an MVNO? Facebook currently earns annual revenue per user of $4. An MNVO can earn between $10 a month and $50 a month per customer with an operating margin between 20 percent and 25 percent.




Edited by Braden Becker

Contributing Editor

SHARE THIS ARTICLE
Related Articles

Coding and Invention Made Fun

By: Special Guest    10/12/2018

SAM is a series of kits that integrates hardware and software with the Internet. Combining wireless building blocks composed of sensors and actors con…

Read More

Facebook Marketplace Now Leverages AI

By: Paula Bernier    10/3/2018

Artificial intelligence is changing the way businesses interact with customers. Facebook's announcement this week is just another example of how this …

Read More

Oct. 17 Webinar to Address Apache Spark Benefits, Tools

By: Paula Bernier    10/2/2018

In the upcoming webinar "Apache Spark: The New Enterprise Backbone for ETL, Batch and Real-time Streaming," industry experts will offer details on clo…

Read More

It's Black and White: Cybercriminals Are Spending 10x More Than Enterprises to Control, Disrupt and Steal

By: Cynthia S. Artin    9/26/2018

In a stunning new report by Carbon Black, "Hacking, Escalating Attacks and The Role of Threat Hunting" the company revealed that 92% of UK companies s…

Read More

6 Challenges of 5G, and the 9 Pillars of Assurance Strategy

By: Special Guest    9/17/2018

To make 5G possible, everything will change. The 5G network will involve new antennas and chipsets, new architectures, new KPIs, new vendors, cloud di…

Read More