Asian service providers have opportunities to expand into foreign markets by launching MVNOs and OTT voice applications that target Asian ethnic groups living abroad. There are over 77 million Asian immigrants living in countries where the MVNO model is popular and smartphone adoption is high, such as the US, UK, Germany, and France. Some Asian operators have already successfully launched offshore MVNOs, but many Asian communities around the world remain untapped. Asian operators seeking international expansion need to carefully consider strategies such as full MVNO, light MVNO, or OTT voice applications and partner selection to profitably serve overseas Asian populations.

1. Opportunities for Asian Service Providers in
Foreign Markets
By Michael Dargue and William Wadsworth
MVNO and OTT voice applications create significant opportunity for Asian service providers to
expand beyond their home markets. Many nations, particularly in the Western world, now have a
considerable Asian population. MVNOs targeting ethnic groups have thus far proved popular, and
despite some Asian operators already moving to capture specific markets of foreign nationals,
competition in this space is still relatively low, with many further markets available to capture.
October 2012

2. Cartesian: Opportunities for Asian Service Providers in Foreign Markets
Copyright © 2014 The Management Network Group, Inc. d/b/a Cartesian. All rights reserved. 1
The Future of Asian Mobile Markets
The current state and outlook of the Asian mobile market varies greatly between different countries, but in
general, Asian operators are seeing opportunities to grow revenues within their home nation becoming
increasingly limited, as competition levels to erode ARPU and as penetration-level growth begins to slow.
Despite the revenue potential of new technologies such as high-speed mobile broadband, some Asian
operators have concluded that they will need to look beyond their traditional home market in order to
maintain the high levels of growth they have previously enjoyed.1
The Developing Global MVNO Market
While the MVNO model has not had a significant impact in many Asian countries to date, other nations’
mobile markets are now showing up to 10-20% virtual operator share. The success of the MVNO sector in
these countries has been driven by a combination of favourable regulatory environments and innovative
market propositions.
1
Ovum, Cartesian
78%
85%
90%
94%
97%88%
95%
100%
103% 105%
108%
112%
116%
119% 122%
113% 115% 117% 118% 119%
131%
135% 137% 138% 139%
50%
70%
90%
110%
130%
150%
2012 2013 2014 2015 2016
China India Japan South Korea Malaysia
11 10 9 9 8 8 8 8
66
63
57 55 54 53 52 51
3 2 2 2 2 2 2 2
36 36
33 32 31 30 30 29
18 17 16 16 15 15 15 14
0
10
20
30
40
50
60
70
2009 2010 2011 2012 2013 2014 2015 2016
Figure 1: Mobile (Voice and Data Services)
Penetration Forecast for Selected Asian Markets 1
Figure 2: Mobile ARPU (Voice and Data Services)
Forecast for Selected Asian Markets ($ per Month) 1

3. Cartesian: Opportunities for Asian Service Providers in Foreign Markets
Copyright © 2014 The Management Network Group, Inc. d/b/a Cartesian. All rights reserved. 2
Figure 3: Total MVNO Market Share in Selected Countries 2
Accounting for 11% of MVNOs worldwide, one of the most prevalent types of MVNO are the Ethnic MVNOs,
which serve migrant populations3
. Services which Ethnic MVNOs are able to offer to their target segment
include: cheaper voice and messaging services to their home country; customer service in their mother
tongue; tailored value-add services such as native language voicemail; “infotainment” services from their
home nation; cheap communication services when returning to their home country; and remittance services
to send money home securely and easily. In addition, through operating MVNOs abroad, local providers are
able to offer better services for their home market – such as providing affordable communication links to
the foreign market.
For example, an operator in the former Dutch colony Suriname, Telesur, launched an MVNO in The
Netherlands to help connect people in the two countries. Telesur offers local rates from, in, and between
the Netherlands and Suriname by means of a multi-country SIM which provides subscribers with a local
profile in both Suriname and The Netherlands. With customer care and content provided in both languages,
Telesur has achieved over 20% market penetration in the target group, with substantially higher ARPU and
lower churn than average prepaid mobile operators.
The Asian Opportunity
With over 77 million Asian-born people living abroad, Asia has produced a larger global migrant population
than any other single continent4
. Many of the largest destination nations, are countries where smartphone
2 Cartesian, Nereo, company websites, press releases
3 Wireless Intelligence, Cartesian
4
Migration Policy Institute calculations of the World Bank Development Prospects Group's Bilateral Migration Matrix data

4. Cartesian: Opportunities for Asian Service Providers in Foreign Markets
Copyright © 2014 The Management Network Group, Inc. d/b/a Cartesian. All rights reserved. 3
adoption is high and where the MVNO model is popular (see Figure 2) – such as the USA, the UK, Germany
and France.
Figure 4: Distribution of Asian-born People across the World’s 10 Largest Immigration Destinations 5
Some Asian operators have already launched offshore MVNOs to capture such opportunities (see Figure 5),
but there are many Asian communities around the world that are yet to be targeted.
Figure 5: Examples of Asian Operator-owned MVNOs Which Have Already Launched 6
5 Development Research Centre on Migration, Globalisation and Poverty
6
Cartesian, company websites, press releases
0%
20%
40%
60%
80%
100%
Spain
UK
India
Canada
Saudi Arabia
France
Ukraine
Germany
Russia
USA
Destination Nations:

5. Cartesian: Opportunities for Asian Service Providers in Foreign Markets
Copyright © 2014 The Management Network Group, Inc. d/b/a Cartesian. All rights reserved. 4
Key Considerations for Entrants
Ethnic-focussed service providers will find it hard to compete on price alone due to volume limitations so
should focus on the added value they can offer their subscribers, such as connectivity to their home country,
language support, and specific appealing content and features.
Many Asian operators have a brand which is well trusted by the people of their country, but even with this
asset, a very strategic approach to keeping customer acquisition costs low would be needed in order to
make the venture profitable.
Entrants need to understand the justification for launch. A key question is whether the primary goal is to
capture overseas revenues, or deliver revenue uplift to the core domestic business. This in turn will influence
the optimum entry strategy: whether full MVNO, light MVNO or OTT voice application.
Partner selection and assessment is also of key importance. Entrants pursuing the MVNO route will need
significant support from the host MNO, requiring a collaborative and viable pitch and proposition to
demonstrate the benefits they can bring. OTT voice offerings may also be developed in collaboration with a
partner, reducing time to market, or built in-house.
Those seeking international expansion opportunities will have to consider their entry strategy carefully.
There is wide variation in local market characteristics across countries of interest; business models,
propositions, brand and customer segmentation will all have to be analysed and tailored.
Cartesian Experience and Support
Cartesian has deep experience in assisting MNOs, MVNOs and regulators achieve their objectives.
We have worked on over 40 MVNO engagements globally including supporting Asian MNOs develop and
execute their international growth strategies. We can support across a number of areas, including:
 Strategy and business case support, including detailed cost and revenue modelling
 Negotiation support for contracts and commercial terms
 Securing funding
 Vendor and partner identification, evaluation and selection
 Assessment of MVNO policy, regulation and market impact

6. Cartesian is a specialist consulting firm of industry experts, focused exclusively on the communications,
technology and digital media sector. For over 20 years, Cartesian has advised clients in strategy
development and assisted them in execution against their goals. Our unique portfolio of professional
services and managed solutions are tailored to the specific challenges faced by executives in these fast-
moving industries. Combining strategic thinking and practical experience, we deliver superior results.
www.cartesian.com
For further information, please contact us at cartesian@cartesian.com