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Q&A Interview with Hakan Demir, CEO at Fenercell

Speaker banners featuring Hakan Demir

With the number of connected devices expected to reach 20.8 billion by 2020, according to Gartner, and the rise of new technologies such as IoT, e-SIM and Blockchain, MVNOs are faced with an always changing market, yet disruptive, but with many opportunities for growth and co-operation. With less than two months to go until the MVNOs World Congress 2018, the MVNOs Series team spoke with Hakan Demir, Founder and CEO at Fenercell.

Operators need to widen their co-operation space including their rivals - they need to get used to sharing. They will also need to transform their organizations and form well-functioning clusters, in order to maneuver through the complexities and high demands of the IoT business, as well as exploiting the advantages e-SIM promises.

In this interview Hakan shares his views on the current state of the MVNOs market, the key trends and challenges shaping the industry, where he sees new opportunities for MVNOs and much more.

We look forward to welcoming you at the MVNOs World Congress in April, where you will be talking about ‘MVNO 3.0 –Creating SmartVNO’. Do you think that operators will ever be able to regain their position in the market as key innovators?

Telcos have evolved to build networks and upgrade them with new generations of technology in a struggle to provide faster and more reliable connectivity in order to justify the revenues they collect from their subscribers. In the good old days of high margins and growing revenues they have always ignored cooperation in their walled gardens. I observe that many of the operators can’t yet sense that - yes, their walled gardens are still there but - the industry is shaping up to be a much different environment leaving their castles as islands in a bigger ecosystem. For the ones who recognize and try to reshape their value creation strategies, life is not easy, as they are too much hard coded in network building and can’t transform into innovation and service building.

What are the key trends and changes shaping the MVNOs market currently?

For a while now, we have seen that consumer interest has shifted from better connectivity to services; they take connectivity as a given - it is expected. OTT players coming from different spaces, entering the picture much later, are more admired, and have created more value than the operators. 5G isn't promising to miraculously turn things in the operators' favour, if they continue to turn their heads away from a more differentiated and personalised services approach.

On the contrary, especially for the operators with weaker financial muscles and little subscriber park, 5G investments might push them deeper in the network struggles and prevent you from seeing where the market is actually going. To make the matters worse, some established telcos will prefer, or find themselves in the position, to champion the wholesale route, squeeze the margins and make life more difficult for the others.

How can Telco operators take advantage of greater flexibility enabled by e-SIM?

IoT and e-SIM are coming in at the right time to present the operators with opportunities like the good old days. The best case potential for operators ,that can be presented by the IoT and e-SIM, can be headlined like this:

“Not only people, but things are out there to be subscribers, in the order of billions and you can reach them without expensive logistics/dealers. That is, an untapped big market to be acquired with less costs (less SAC)”.

But this will not benefit them if operators keep going with their inherent instincts. IoT and e-SIM are here to stay and they will be exploited by other players, as in the case of OTTs, through innovative business plans - if the operators are late again.

Operators need to widen their co-operation space, which means including their rivals - they need to get used to sharing. they will also need to transform their organizations and form well-functioning clusters, in order to maneuver through the complexities and high demands of the IoT business, as well as exploiting the advantages e-SIM promises.

Where do you see new business opportunities for mobile operators?

Another deep impact coming from within the neighboring industry is the new mindset forming around the blockchain.

If you peel down all the fuss about cryptocurrencies, the essence is the whole new concept of blockchain, that, I believe has the potential to reshape how we run the entire business.

Operators, I believe, still have the upper hand, as they possess possibly the best form of subscriber ownership, as well as deep knowledge as to who they are, what they do and where they are. Transportation, cars specifically, banking, energy, security are among the first to approach industries, with a proper army of service/solution provisioning, of course. What I have said up until now is still valid, to a large extend for both MNOs and MVNOs, they need to assume roles proportionate to their size and capacities.

 What has impacted your business the most?

We, as Fenercell, have been gravitated where the people are, rather than where networks are, with our strong/trusted brand power. We see IoT and e-SIM as opportunities to broaden our business. As these new technologies will make us less bound to the operator and give us more freedom to innovate.

MVNOs World Congress 2018 promo banner

You can meet with Hakan Demir during the MVNOs World Congress 2018  where he will deliver a session on ‘MVNO 3.0 – Creating SmartVNO’, discussing how to enable Smart Home and Smart Cities growth via flexible connectivity and tailor-made service offering, plus how new services give MVNOs an opportunity to sell more SIMs, bundles and devices.

Have a look at the agenda and download the 2018 event brochure.

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