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Why To Be Cautious of an MVNO

This sorted story on PCS Intel about ROCKITtalk’s Sorted History suggests one reason that having service with a Mobile Virtual Network Operator (MVNO) might not be such a great idea. Ignoring the possiblity that ROCKITtalk is some kind of a scam, what happens when the MVNO quits, changes underlying carriers (e.g. from Cingular to Verizon, as is the case here), or quite simply goes out of business? What happens to the customer? What about all the money you’ve put into your account? What about the equipment, will you be able to use it somewhere else?

Before I sign up with one of the MVNOs, I’d have to get answers to some of these questions before signing up or giving any money. Me, I’d rather just deal directly with one of the big boys. I’ll pay more for the privilege, but eliminating a middleman from the equation is a good thing. The same can be said about buying equipment and service through an “indirect” (an authorized agent of the carrier, not owned by the carrier). I’d much rather deal directly with the company.

That isn’t to say that all MVNOs or indirect retailers are bad. Virgin Mobile has certainly done quite well for itself as an MVNO, using Sprint here in the US and T-Mobile elsewhere. It certainly has a well-recognized brand. Tracfone has also done well for itself using Cingular (previously AT&T Wirelsss) as the underlying carrier. I’m sure there are plenty examples of reputable, reliable MVNO-based carriers. There are also good indirect retailers too.


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