Just a few weeks after the Blyk, the ad-funded MVNO network for young people, completed its move towards it’s operator partnership with Orange, O2 have announced their own MVNO with a very similar business objective. In a similar way, GiffGaff sells the SIM card only and customers will either use their existing phones or buy a new one separately. The SIM Only top-up service is aiming to be fully up and running before Christmas.
GiffGaff – the community SIM-Only MVNO
By setting up an MVNO, GiffGaff hope to create an online community that will inspire their own product ideas, create content, as well as provide support for each other. This also means that customers are essentially running their own customer service and so there are massive cost savings with this business strategy. In addition, customers will be rewarded for referring GiffGaff to their friends or relatives, creating user-generated content and voting on decisions that affect the strategy and future of the business. The SIM only service will also allow users to write blogs and post on its online forum.
Customers will receive will be provided with rewards twice a year in the form of call, texts or cash. They can also choose to donate their rewards to charity if they wish.
GiffGaff will be using O2 to provide its service so users can expect a reliable and robust network.
Mike Fairman, former O2 executive who is heading up the new operations said:
“The name Giffgaff came about from it’s meaning – to give and receive. We’re not spending millions of pounds on advertising campaigns – the incentive is for members to recommend others to join Giffgaff, which will contribute towards their rebate.”
“We’ve chosen this to run as a SIM-only service because that market is strong and growing at present. Many people are still happy to use the same phone and it means we’re not having to subsidise handsets.”
Giffgaff could also act as a complimentary business to the current O2 SIM only product range and there may be opportunity to gain feedback and development for its Pay as You Go and SIM Only contract portfolio.
Blyk SIM-Only
Blyk was a SIM-only venture, founded by ex Nokia staff, which gave young people free calls and texts if they agreed to view a certain number of mobile advertisements. Orange have now licensed the business model but have not announced any future plans as yet for the business but something maybe expected for 2010 following the launch of GiffGaff.
Sources:
Mobile News CWP – O2 to launch GiffGaff MVNO
Global Telecoms Business – O2 sets up reward-funded SIM-Only MVNO
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