On Wednesday, March 19th, UK-based mobile virtual network operator OVIVO shut down its service. There was no prior forewarning or notice sent to their approximately fifty-thousand customers. On Wednesday the service was turned off for its customers to much dismay. Needless to say there were fifty-thousand disappointed and upset customers on March 19th. If you go to their official website located at www.ovivomobile.com there is the following statement, “We are very sad to announce that for reasons beyond our control, OVIVO Mobile is closing down on the evening of Wednesday 19th March 2014. We’d like to thank each and every one of you for your support and friendship over the last two years.” There was still no explanation why the service was shut off without any prior alert to the customers.
OVIVO was one of many mobile virtual network operators or MVNO’s in the world. Essentially these are companies that provide wireless service to customers without owning any wireless infrastructure themselves. Instead the MVNO’s enter in to a lease agreement with carriers and mobile network operators that do own spectrum and wireless infrastructure. These lease agreements provide the MVNO with wholesale rates, which just mean the MVNO agrees to a large volume in order to obtain a special rate. OVIVO had a special lease agreement with Vodafone UK so customers were using the Vodafone UK network.
OVIVO didn’t sell mobile phones. Instead they sold SIM cards. What made their service unique is that you could purchase an OVIVO SIM card for a flat fixed rate, typically £15 to £20, and that would give you a specific amount of data and text messages per month. They had different packages that offered varied amounts of data. There was no additional cost that the customer would incur. Instead OVIVO used an advertisement model that would display “OVIVO adverts” every five or ten minutes when the customer used the mobile browser. It was an interesting model that ultimately benefited the customer. The adverts were also smart and targeted to display offers based on your browsing habits.
There is a lot of speculation why OVIVO shut down its service. The two most obvious are the agreement between OVIVO and Vodafone UK. Something may have happened to break that lease agreement. Another possibility could have been between OVIVO and the adverts. If OVIVO was unable to continue attracting and retaining companies to advertise then it’s business model would be imaginary.
Now it’s unclear yet what will happen for customers who had credit remaining. The only information OVIVO has shared, by way of it’s website, is the following statement, “To keep your OVIVO number, just fill out this form, and we’ll send you your PAC code.” Once OVIVO sends the customer their PAC code they can transfer or port their mobile number to another mobile network operator.
This is a good opportunity for Vodafone UK to obtain fifty-thousand new direct customers and especially since they are already using the Vodafone network. Vodafone should extend an offer to the fifty-thousand OVIVO customers to port their numbers to Vodafone; receive any remaining OVIVO credit, with signing up for a new Vodafone agreement. Mobile network operators that enter in to agreement with MVNO’s should share the responsibility to some extent for situations like this. This is a chance for Vodafone to demonstrate it cares for the customers that use their network whether they are direct customers or by way of MVNO’s.