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Retailers As The Next Wireless MVNOs

During the 1990s, when retail sales of pagers were booming, multiple retailers — mainly car stereo retailers — resold paging service under their own brand name. Departing from more traditional private-label arrangements, these retailers billed customers for monthly airtime service and fielded customer-service calls. The retailer, in effect, was the carrier.

Today, history has begun to repeat itself.

On July 11, Best Buy launched the Best Buy Connect brand under which it offers 3G mobile-broadband service. Best Buy also plans a private-label 4G wireless-broadband service under a deal with 4G carrier Clearwire. Acting as an MVNO — the new term for reseller —  Best Buy bills consumers, provides customer support, and sells wireless-broadband USB modems and portable computing devices embedded with wireless modems.

The company activates service on the Dell Inspiron Mini 1012 netbook USB wireless and expects to offer additional broadband-connected hardware in the fall, a spokesperson told TWICE. The company also expects to bundle service with USB modems, she added.

More retailers could get into the act in the coming years now that hedge-fund-backed LightSquared plans to build a terrestrial- and satellite-based 4G LTE data network with VoIP voice. Service would be sold only on a wholesale basis to retailers, cable operators, mobile-device makers, content companies, websites and any other companies that want to offer service under their own brand.

Companies reselling LightSquared service would be allowed under Federal Communication Commission regulations to offer a terrestrial-only service or an integrated terrestrial/satellite service in which VoIP calls and data sessions could be handed off between the terrestrial network and satellite.

Back in 1999, we ran a little story (scroll down a bit in the linked webpage to find the article) about how some car stereo chains leveraged their brands to make a go of the pager business.

Car Toys, then a little eight-store chain, lauded its newfound ability to put together its own promotional packages. Cleveland’s 10-store Auto Accents chain touted its ability to bring in traffic when customers came in to pay their bills. In today’s world, that strategy would also apply to online bill payment via a retailer’s website.

With retailers major and minor trying to find new ways to offset margin erosion and differentiate their products, more retailers could soon join Best Buy in becoming MVNOs.

What say you?