Here’s an interesting development. A mobile network in France called NRJ has announced a new ability that will make life much easier for itself and its customers. NRJ doesn’t own it’s own cell towers, and depending on where you are France it can run on either Orange or SFR towers… and quite often both. So NRJ has been working with mobile software company Sicap to turn its position straddling two different operators from a disadvantage into an advantage.
What’s the deal with NRJ?
I’ll explain a little jargon here first. NRJ is what we call an MVNO – a Mobile Virtual Network Operator. That simply means that it while it does run a mobile network, it doesn’t own any physical broadcast towers. So it has to purchase space on towers owned by Mobile Network Operators like Orange, who crucially have no “V” in their name. Day to day operation is a trickier operation for MVNOs. They don’t have to worry about huge capital investment the way MNOs do, but that comes with its own downsides. They are constrained to the same areas as the operators they are renting towers from. So in order to reach as many people as possible, NRJ decided to rent space from both France Telecom and SFR: the two largest mobile networks in France.
And that causes some problems, mostly centred around consistency. NRJ wants to make sure that every single customer on its network gets the same experience. But NRJ is dealing with two different host networks, and it will have to pay different rates and meet different technical standards for both of them. This is particularly tricky because, like most MVNOs, NJR is aimed at a niche – and that niche is 18 – 35 year olds who like music, movies and Instant Messaging. Let’s say, hypothetically, that it costs more to download a song over SFR than it does over FT. What does NRJ do in that situation? It can charge customers whose service is being hosted by SFR more than it does for those on FT. But that leads to unhappy customers and difficult booking. Or it can suck up the loss itself. And that leads to lower overheads in an already pretty scanty market.
The attempt to solve this problem has lead to today’s announcement.
What have NJR and Sicap been up to?
Basically, they are combining a clever management system with SIM cards. Every NRJ mobile phone will feed very specific information from the SIM back to Sicaps Device Management Center. This allows Sicap to identify which host network that customer is on. So when an NJR customer wants to update their device, or download some content or an application, the Sicap solution can interact with their SIM directly to make sure their device has all of the correct settings to ensure the device works perfectly with the host. So there’s your consistency of service.
But NRJ can also identify which network it would be best for the customer to be on. For customers who live in areas with both FT and SFR coverage, NJR can make sure they are connected to the operator which has the best value rates for NJR services. And if the host networks change their rates, and one becomes cheaper all of a sudden, NJR can extremely quickly issue new SIMs to those customers to switch them to other host – but they get to keep their number, and their charges stay the same. So NJR keeps its costs down and the customer doesn’t see any difference.
What we think?
It’s possible I’ll get some emails after this is published saying “this kind of system has been in place in X for Y years now, keep up”. But this is honestly the first time I’ve seen a system like this in place, and my reaction is “smart, smart, smart.” The overall cost of manufacturing and posting a new SIM card is more than made up for by the savings made on what could be years of cheaper rates. Ultimately this allows NJR to hit a massive user base, combining the two biggest MNOs in France – and it also allows them to make as much savings on rates as possible by switching between the two. But it also generates a truly epic amount of backend work to be done… but if Sicaps Device Management Center is robust enough, then it could be both easy and cost effective.
