KATHMANDU, July 20

The government is mulling over giving entry to mobile virtual network operators (MVNOs), who will be able to buy talk time and internet bandwidth in bulk from existing operators and retail the services to customers under their own branding and tariff.

MVNOs provide telecom services without owning spectrum or telecom network infrastructure. Rather, they lease network capacity from the mobile operators to obtain bulk access services at wholesale rates and then sell the services to users adding profit margin. As a part of preparation, Nepal Telecommunications Authority (NTA) is readying a legal framework by hiring a consultant.

As per the NTA, the consultant has already completed the interim report regarding the new provision to allow MVNOs to operate. Such firms are known as mobile other licensed operators and virtual network operators, depending on the market. Based on the report prepared by the consultant, the telecom regulator plans to ready the licensing provision and fees to be imposed.

“In a way, MVNOs will also facilitate the existing telecom companies to increase their business by selling air time and data in bulk,” said Achyuta Nanda Mishra, assistant spokesperson for the NTA.

He added that these kind of companies have been introduced in many markets as regulatory intervention to offer services at cheaper rates to customers.

As per media reports, MVNO model has proven to be a success in markets like the UK, the US, and some European countries. In India, too, the government is working on permitting operation of MVNOs. In May, Telecom Regulatory Authority of India (TRAI) had recommended the Department of Telecom there to introduce separate licensing framework to allow operation of MVNOs that could offer voice, data and video services by paying licence fee of INR 75 million.

An official at the Ministry of Information and Communications (MoIC) said that even if the government permits operation of such types of companies, it will be hard for them to sustain as voice service is already quite cheap. “MVNOs can find market in basically underserved areas for wireless data because the internet service is already being provided with multiple choices in urban areas at competitive rates,” the MoIC official said.