The Sherpa, a Masan Group subsidiary, has completed the purchase of 70 per cent of Mobicast JSC for a total cash payment of VND295.5 billion ($13 million) to enter the telecom industry.
|Masan takes over Mobicast to venture into the telecom sector |
Mobicast, doing business under the brand Reddi, is a startup full-serviced Mobile Virtual Network Operator (MVNO), a wireless communication service provider that does not own wireless infrastructure. MVNOs like Mobicast collaborate with traditional Mobile Network Operators (MNOs) to provide telecom services to consumers using their radio spectrum-based transmission services and related wireless network infrastructure.
This is a win-win situation for both MNOs and MVNOs. Specifically, MNOs profit from increased network capacity utilisation while MVNOs benefit from an asset-light business model. MVNOs are a common business model in the telecom industry around the world. In the UK, MVNOs account for 20 per cent of the overall mobile market.
The entry into the telecom sector is part of Masan’s efforts to build its offline-to-online (O2O) “Point of Life” consumer ecosystem, which already features Vincommerce, Techcombank, and Phuc Long. By unifying its consumer base via Reddi, Masan is able to create a loyalty programme for its consumers.
On a standalone basis, Reddi stands to benefit as it has exclusive access to Masan’s consumer base and physical and online nationwide touch points. Specifically, this will significantly lower Reddi’s consumer acquisition cost enabling it to reinvest the savings to develop unique digital consumer solutions and a customer service experience platform.
Danny Le, CEO of Masan Group said that, “Our mission is to develop the most efficient integrated O2O products and services platform to serve 50 million consumers throughout their daily journey by 2025. Reddi is the first step to digitalise our platform and synchronise our products and services into a unified offering.”
“While we are in the early innings, we have all the strategic components to develop the most cost effective consumer acquisition model, thereby lowering the costs of our services and products for the benefit of our consumers – this is the definition of Point of Life,” he added.
Founded in 2016, Mobicast officially obtained its license to operate a MVNO network under the consumer brand Reddi in 2019. Reddi focuses on service quality and customer experience and targets the younger and more digitally-savvy consumers.