MVNO: Pros and Cons of “Cheap” Networks

by Sandra Henshaw - , Last Updated on December 4, 2017, Buying Guides

With so many mobile operators on the UK market, choosing which one is right for you can be tough. Particularly when so many of those operators are pretty affordable. Sure, they might not be big names, but cutting your phone bill in half is pretty tempting. Many of these cheaper networks are MVNOs. Don’t know what that means? Then keep reading, we’re here to help!

What is an MVNO?

MVNO stands for Mobile Virtual Network Operator, and you might sometimes hear the term Virtual Network or Leased Network, which refer to the same thing. The concept is a lot simpler than the names would have you believe. MVNOs are like renters in a house, whilst big name regular mobile operators are the builders and owners of that house.

A big name network, say O2, for example, has to build the infrastructure they need to give service. So O2 builds their own cell towers, negotiates with the government for frequencies, does everything that’s necessary to build that house. Once that’s done though, a MVNO can come in and rent some of that service.

This is a win-win for everyone concerned in the deal. The parent network (in this case O2) can’t possibly use up all the network they’ve created, so they rent some out to an MVNO, helping to pay back the cost of creating the network in the first place. The MVNO on the other hand, doesn’t have to pay a hefty initial investment to build a network, and can just start selling phone plans to customers. Cool, right?

So Wait, How Does This Affect Me?

There are pros and cons to using an MVNO that we’ll get to in a moment. But for now, the important thing to know is that your chosen operator doesn’t necessarily own or even operate the network that you’re using. If your operator is an MVNO that rents its service from O2, then technically you’re using O2’s network. That means that you get the same coverage and level of service that an O2 customer would get, often at a much cheaper price. Sounds good, right? Well, it can be, but not always…

The Pros of Going MVNO

The main benefit of going with an MVNO as your operator is that you’ll almost certainly get lower prices. An MVNO doesn’t need to pay to create an infrastructure, so doesn’t need to recoup that initial investment by charging you higher prices. And many MVNOs have little retail infrastructure, selling plans online, through other retailers, or having only a handful of shops. This means they have low overheads and can pass those savings along to you.

Secondly, you should get great service. Given that an MVNO is renting its service from a major operator, things like coverage and reception should be just as good as you’d expect from that major operator. Great service for a great price? You can’t argue with that. Or can you?

The Cons of Going MVNO

There are some downsides of using an MVNO though. Firstly, you’re unlikely to get many advantages, things like cinema tickets, great handset deals, or free gifts that are often offered as incentives by major operators. MVNOs tend to be very much no frills. It’s like the difference between flying British Airways and EasyJet.

MVNOs also tend not to offer bundling. Major operators are generally owned by huge companies, many of whom offer services other than mobile phone plans. In these cases you can save money by combining say your mobile phone plan and broadband home internet plan into one package, which is known as bundling. Bundling does offer some serious price advantages, so if you need more than one service, the mobile savings you get from an MVNO might not be worth it in the end.

Finally, due to their lack of retail infrastructure, it can be tough to get immediate, person to person service with an MVNO. With O2, for example, you can walk into any O2 shop on your high street and get problems solved. Few MVNOs offer this possibility, meaning you’ll need to deal with online or phone customer service, which can be frustrating.

What MVNOs Do I Have to Choose From?

The vast majority of the UK’s mobile operators are actually MVNOs, including some names that you’re probably very familiar with.

GiffGaff

is probably the most popular MVNO right now. They use O2’s network but offer serious savings when compared to O2’s regular pricing.

Tesco Mobile

also use O2’s infrastructure.

TalkTalk

rent their mobile network from Vodafone, and again, offer some great savings, and even have home broadband as well (unusual for an MVNO).

The People’s Operator, iD Mobile,

and

SheBang

all rent their networks from Three, and all give you savings. SheBang is the only UK network that offers only credit-check free contracts, so you won’t need to pass a credit check.

The big grand-daddy of parent networks is EE, with many MVNOs renting service from them. This is because EE is made of a conglomerate of operators (including what used to be Tmobile and what was Orange), and many of their constituent parts were also parent networks, so they inherited MVNOs.

Virgin Mobile

is an EE MVNO, as are

Asda Mobile

and

BT Mobile

.

Go, Econet, Family Mobile, Natterbox, Simple Call, PlusNet

and

Telecom Plus

are all also EE MVNOs.

Are MVNOs Trustworthy?

That’s a tough question. With so many companies around there are bound to be some bad ones. And whilst actual phone service should be as good as it is with the major operator parent company, customer service and billing issues differ widely. The more familiar MVNO names such as GiffGaff and Tesco Mobile are certainly trusted in the UK market. With smaller, less recognisable companies, you might be taking a risk though. Before deciding on an operator always read customer reviews and complaints to be warned of any potential problems.

An MVNO can be a great choice for an operator if you’re looking to save some cash. But they’re not such a great choice if you’re looking to get more than just mobile service. For perks, great customer service, and bundling, a major operator is going to be better, though they come at a price.