Investment Idea: How To Set Up Your Own Cell Phone Network

Have you got a lot of cash burning a hole in your pocket? If so, you will doubtless be looking for ways to invest that money and make it grow. Perhaps you are thinking of pooling your cash together with other investors in a new business.

One ambitious sector you might wish to consider is the cell network industry. All the major cell networks boast enormous profits on an annual basis. Yes, the initial investment might seem high. But then, so are the financial rewards!

Investment Idea: How To Set Up Your Own Cell Phone Network

nanagyei (Flickr)

Before embarking on such an enterprise, there are a few considerations you need to make. They are as follows:

Start Out on your Own or Become an MVNO?

When you want to start a new cell network, there are a couple of options open to you. The first involves starting from scratch. And the second involves piggybacking off an existing network.

Setting up a brand new cell network from scratch is going to be the most expensive option. That’s because you have to build or lease network infrastructure. Examples include cell towers and other communications links.

You will also need to apply for a government licence to share part of the radio spectrum. Governments around the world allow companies to use certain radio frequencies. If there were no management of radio spectrums, no-one would have a working service!

While applying for a licence might sound easy in theory, in reality it’s a long-winded and expensive process. Companies usually have to “bid” for certain frequencies. This is akin to the way they would tender for government contracts.

There is also the question of what areas or regions your network would cover? As you can see, setting up a cell network business is a long-term and costly exercise!

The other option that I mentioned a moment ago is to set up as an MVNO. In case you are wondering, that stands for “Mobile Virtual Network Operator.” In the UK, for example, one of the major cell networks is O2. An MVNO that uses the O2 network is “GiffGaff” and enjoys the same coverage and data speeds as the main network.

Setting up as an MVNO is significantly cheaper than starting from scratch. The process is still quite involved, but you don’t have to worry about paying for expensive equipment. In fact, the likely expenses you will have are to do with setting up telecom billing software.

The good news is that there are plenty of firms that specialize in creating such software, so you don’t have to.

Getting Customers

Setting up the business is perhaps the easy part in comparison to the next stage: getting customers! To make an impact on the market, your business will need to have a significant marketing and advertising budget.

I recommend working with a marketing agency used to dealing with high-profile clients. The last thing you want to do is blow your budget on an ineffective marketing campaign.

As part of your marketing strategy, you should think about what offers and price plans you can use to entice new customers.

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