MVNO stands for “Mobile Virtual Network Operator“, and as such, an MVNO does not own or have it’s own infrastructure ( wireless cell phone towers), but rather buys wholesale minutes, data and text from major carriers such Verizon, Sprint, T-mobile, AT&T, etc to resell to you under its own brand name. So essentially an MVNO is simply one of the BIG 4 wireless carriers but running under a different name.
Almost all prepaid cell phone plans and providers are offered through an MVNO. For instance, when you sign up for the prepaid wireless carrier Page Plus Cellular, you are essentially signing up for Verizon as Page Plus Cellular leases service from Verizon. You’ll get the same Verizon coverage through them at 1/2 to 1/3 of the cost, so as you can see, an MVNO has the potential to save you a lot of money! So now the question for you becomes, why are these MVNO’s so much cheaper than the BIG 4 themselves? Well, if you’ve followed along you can see for starters they don’t have any infrastructure to maintain. That is the responsibility of the BIG 4. Another reason is that when you sign up to get a new phone and contract with one of the BIG 4, they hide the cost of that new phone in your monthly bill (previously T-mobile was the only exception, but now the other carriers are beginning to be more transparent by offering no contract cell phones with monthly “installment” plans). That “free phone” you think you are getting may actually cost the BIG 4 $250 to purchase, so that cost gets passed on to you over the course of your contract with them. Often they are charging you much more for the phone than they actually paid for it so it’s cheaper for you to buy the phone from a website such as eBay or Amazon and to sign up with a prepaid provider. The third reason why prepaid is cheaper, is that some carriers, like Sprint, don’t share their roaming agreements with their MVNO’s. What you might not know is that in areas where Sprint doesn’t have it’s own cell phone towers and coverage, Sprint pays Verizon so that its customers can “roam” on the Verizon network (for voice only). Virgin mobile, an MVNO owned by Sprint, does not have this same agreement. It only uses Sprint’s towers so it’s coverage isn’t as good as it would be if you were a direct Sprint subscriber. If you are interested in finding out more about MVNOs and finding one that can help save you money, you may want to start by exploring this MVNO list or by using the BestMVNO wireless phone plan comparison tool.