inbabble.com

Stelios Haji-Ioannou, the entrepreneur behind easyJet and a host of other “easy”-branded businesses, has stated his intention to launch a free, ad-supported MVNO service next year. If so, he will be following in the footseps of Blyk, due to launch using a similar model this summer. The question is, given the failure of well-funded, subscription-based MVNOs like Amp’d, how on earth can the low-cost airline magnate make this idea fly?

The “easy” brand had previously been licensed to TDC, the Danish incumbent telco, for its embryonic mobile operation, easyMobile. However, TDC was promptly bought by a private equity consortium and the service was evidently not a good fit for the new owners’ strategy. TDC’s license was revoked, and Haji-Ioannou looks set to breathe new life into the easyMobile brand.

So what are the chances of success? Well, fortunately for him, Haji-Ionannou will have the chance to see how it should, or shouldn’t be done by following the fortunes of Blyk. The start-up was founded by former Nokia President Pekka Ala-Pietilä, has a network agreement in place with Orange, and has already attracted confirmed placements from major brands including Buena Vista, Coca-Cola, and L’Oreal Paris.

With this level of management pedigree and preparation, it seems likely that if the model works at all, Blyk should be able to prove it. The price-sensitive 16-24 year old target user group should certainly be receptive to the lure of a free service. And the company is promising creative ads in a variety of multimedia formats that are both engaging and highly relevant, thanks to its user profiling system.

In contrast, Haji-Ionannou apparently envisions audio ads being played to users before a call is connected. And this highlights one of the potential points of failure for the service. The purpose of advertising is changing from the motivation of the disinterested, to the engagement of the already interested. Users are becoming used to ignoring (on the Web) or avoiding (on TV via TiVo-style devices) any and all forms of advertising. Making ads intrusive, however relevant they are, therefore seems a risky strategy. And that’s without even considering the difficulties all MVNOs face in competing with the established mobile operators. Making this new twist on the MVNO model work is likely to be anything but easy.

Hamish M.