Sharing is Caring: Multi-operator resources are the future of mobile
In the ultra-competitive mobile telecom market, mobile operators allocate huge budgets for marketing and the CAC (Cost of Acquisition) of new subscribers is hundreds of dollars. So it might come as a surprise to learn just how much these operators actually cooperate and share resources.
The models for sharing can vary and include almost any cost component in the mobile ecosystem provided that the sharing has been approved by the local regulator. Operators share physical space and even energy costs for their antennas and equipment, the masts and the RAN equipment that go into each cell, the core network and even the billing systems. In certain cases, regulation allows operators to pool the spectrum that they paid dearly for in spectrum licenses.
Putting aside public perception, It actually makes a lot of sense for operators to seriously consider sharing with their competitors. There are huge potential benefits to sharing: lower CAPEX, lower OPEX, lower cost and faster speed of rolling out new technology, more cost effective expansion. There are indirect savings as well, whether they come from more optimized power consumption, fewer truck rolls and better deals on equipment, to name a few.
Sleeping with the enemy
The rationale for sharing amongst mobile providers can vary. For new entrants, who are usually cash-rich and hungry for customer acquisition, this can offer a quick path to broad coverage, since they save the time and money of rolling out equipment across their target service area. For incumbent players, the chance to recover costs that were sunk into real-estate, to fill under-utilized capacity, to share upgrade costs and to subsidize geographic expansion (especially for sparsely populated areas) often justifies collaborating with their competitors.
Models such as MOCN (Multi-operator Core Networks) and MORAN (Multi-operator Radio Access Networks) have been proposed specifically with such cooperation in mind.
The bottom line is that it looks like, for a variety of reasons, sharing is the future of mobile networks. Mobile broadband connectivity is considered to be almost a basic human right and certainly a condition for equal opportunity and social equality. It is no longer feasible, from a public and a regulatory perspective, to cherry-pick lucrative areas or well-off audiences, so networks must be wide enough to serve all yet smart enough to be able to differentiate between multiple tiers of service. However, the cost of maintaining mobile networks that can satisfy the high demand AND provide broad geographic coverage AND provide the best user experience is a huge burden. Operators who bear it alone are at risk of being cash starved, slowing their speed of innovation and resulting in less-than-stellar stock performance. On the other hand, operators who share can focus their resources on new services, on creating a competitive edge and on drawing in/maintaining the key audiences they rely on.