The mobile virtual network operation (MVNO) deal is a renewal of the world’s first-ever MVNO agreement, which was launched in 2000.
Under the deal, EE will provide wholesale mobile network services to Virgin Mobile for an undisclosed price. Ironically, parent company Virgin Media, owned by Liberty Global, is the biggest competitor to BT in the provision of fixed broadband services in the UK.
Peter Kelly, managing director of Virgin Mobile, said: “This winning combination with EE will give Virgin Mobile even more control and firepower to deliver innovative services to the UK mobile market. Virgin Mobile customers want fast speeds, flexibility and plans packed full of data – we’re going to continue to deliver.”
The full MVNO agreement, which covers voice and data services, replaces an existing MVNO wholesale agreement between the two companies and extends its exclusivity to 2021. In November 2016 Virgin Mobile launched 4G in the UK. It combined this with services that give customers free messaging on WhatsApp and Facebook Messenger and the ability to rollover unused data
The announcement comes only days after Sky, another of BT’s rivals for the UK fixed broadband market, signed a deal with Telefónica’s O2 for the provision of MVNO services.
Virgin Mobile, which became Virgin Media when the UK cable TV industry coalesced into one group in 2006, pioneered the MVNO industry in 2000 when the company signed a deal with mobile operator One2One – which became T-Mobile UK and then was absorbed into EE.
Virgin Media now has three million customers in the UK. The Virgin group, controlled by Richard Branson, used the model pioneered in the UK to license Virgin-branded MVNO services in a number of other countries, including the US, where the company is owned by Sprint, and Australia, where it is owned by Singtel’s Optus.
Gerry McQuade, CEO of Wholesale and Ventures at BT, said: “This has proven a successful relationship for both parties for many years and, as we enter a period of further technological change in the mobile market, we are very pleased to renew and extend our 17 year old relationship.”
EE provides MVNO services for a number of other operators in the UK, including China Telecom. It was the infrastructure provider for the Post Office’s mobile network, but that closed in 2016 after less than two years.
Another MVNO, operated by supermarket group Sainsbury’s using Vodafone infrastructure, closed in early 2016. That was Sainsbury’s second attempt at an MVNO – an earlier project, using O2’s network, closed in 2003.
Sainsbury’s supermarket rival, Tesco, runs MVNOs in five countries, including the UK. Dixons Carphone, an electronics goods retailer, runs iDmobile in the UK with Three. In December 2016 China Unicom announced it was launching an MVNO in the UK, using O2.
