Quick, who's your mobile phone provider? Despite what it says up there, it may not be who you expect.
You see, many countries only have a small handful of companies
that own the backend infrastructure, such as cell towers and data servers
that make up the mobile network you use every day. For example, there are only three such national operators
providing service to our friends down in the United States, Verizon, AT&T, and T-Mobile.
But if you're an American, I'm sure you've seen commercials for Boost Mobile,
Consumer Cellular, Google Fi, and many others.
And many of these promise nationwide coverage.
So how do they pull this off if they don't even have their own towers?
Each of these companies is an example of what we call an MVNO.
No, that's not some drop house ban that you found on Apple Music.
It stands for Mobile Virtual Network Operator.
And it's exactly what it sounds like, a mobile company that operates virtually,
that is, without owning their own infrastructure. But what the heck is the point of that?
Well, it turns out this kind of arrangement can be a win, win, win for the big carriers,
the MVNOs themselves, and for customers.
The large mobile operators get to sell off unused bandwidth that they might not otherwise make any money off of.
The MVNOs get to buy large amounts of this unused capacity at wholesale prices,
like some kind of Costco for radio waves. And then they pass these savings along to you, the customer.
In fact, this is the key way that MVNOs differentiate
themselves from the big carriers that they piggyback off of.
They advertise similar coverage areas for lower prices.
And some MVNOs will even buy bandwidth from multiple networks,
which can give you even better coverage than if you bought directly from one of the big boys.
They can also differentiate themselves from other providers by offering better customer service
or more favorable contractual terms, sometimes no contracts at all.
One big difference you've probably noticed if you've ever considered going with an MVNO
is that their selection of smartphones tends to be a little more limited.
Of course, you can always just buy your phone separately instead of through a provider,
but the big advantage of buying it through your carrier is that you often get a subsidy or a payment plan,
making it cheaper than purchasing it outright, at least cheaper upfront.
But even if you get the device you wanted a good price from an MVNO, you might be in for a rude surprise
when you dig into the details of your coverage plan.
One of the biggest pitfalls of MVNOs is that although they often advertise
having speeds just as fast as their parent carriers,
those major carriers will nearly always prioritize their own customers.
So there's a good chance that you'll experience throttling or forced slowdowns,
both during peak usage hours and if you exceed a certain amount of data use each month.
And to top it off, the high-speed data that you do get
may not even be 5G. All of that said, MVNOs are not all the same,
with some offering features and data plans that differ greatly from their competitors.
So read the fine print before you fork your hard-earned money
over to either a major carrier or an MVNO,
no matter how funny or annoying the advertising might be.
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