"The much-hyped brand MVNO will reward only those few firms with powerful brands, niche customer bases, easily mobilised core businesses, and strong management support. The unexploited device MVNO opportunity creates more certain value with less risk - but fewer firms can pursue it."
Analyst Michelle de Lussanet added:
"While network operators don't like MVNOs, most expect to host two MVNOs by 2004 and think that MVNOs will contribute 6% of operating profits that year. We believe that executives must snap out of their brand MVNO dreams; firms that have spent hundreds of millions on marketing and customer service to build their brands and earn customers' trust have far more to lose than to gain from an MVNO play."
According to the report, few MVNOs will execute perfectly or compete against mobile operators effectively using a targeted market approach. Apart from direct financial loss, Forrester sees the risks as being brand damage and loss of customers in core product lines.