After acquiring Flash Mobile in Colombia and Peru, Mexican MVNO Diri is aiming to reach 1mn users in Latin America and has not ruled out making new acquisitions in the region.
“We're the most innovative telephone company in Mexico. We do things in the market that no one else is doing,” Yago Amerlinck, director of Diri's Digital area, told BNamericas.
With several brands on the market, Diri aims to grow in very specific niches.
The company has a partnership with a content creator Luisito Comunica for its MVNO service Pillofon and also uses its Diri brand to support social causes.
“We have the Cause Plan, which is the first socially aware telephone plan in the world, with which we donate 10% of recharges to different social causes, which are rotated every two months,” Amerlinck said. Some 18% of Diri users report that support for social causes was a determining factor in their purchase decision, he claimed.
The acquisition of Flash Mobile will allow it to expand these market niches and add new ones in the Andean markets of Colombia and Peru.
“For us, markets like Colombia are very attractive for an MVNO” he said. “User resistance to trying new services is lower and the network infrastructure that operators such as Movistar have is very competitive,” he said.
That allowed Flash to reach nearly 134,000 users in the market by the end of 2Q23, according to the latest data from the ICT ministry.
“In that market we see an audience that isn't afraid to change, as long as you offer them a differentiated and competitive product,” he explained.
In Peru, where Flash Mobile had some 131,500 users at end-September, the firm also believes the market provides opportunities for growth, and it hopes that this boost will take it to 1mn customers in the region by year-end.
In Mexico, Diri had just over 175,000 clients at the end of 2022, according to the latest data available from regulator IFT.
“In the coming months we have a very interesting plan to launch new products, plans, functionalities and technological tools that we believe will take this business to the next level,” Amerlinck said.
For now, there are no plans to launch other brands, such as Pillofon in the Colombian and Peruvian markets. “We're still focused on absorbing the operations of Flash Latam and improving the current business,” he added.
The company has also not ruled out making new acquisitions to increase its growth in the region. “It's something that we're certainly not closed to, since in Mexico we've also absorbed the operations of other telephone brands that used the Altán network,” the executive said, underscoring that Latin America is a “natural territory” for expansion.
MEXICO
“The Mexican market has always been difficult for entrants due to the presence of very large traditional telephone companies with very strong operations. It's no coincidence that Telcel has the market position it has. It's a product that works and works well,” Amerlinck said.
However, the arrival of the Altán shared network has allowed competition to improve, he added. “It has given us a product with a highly attractive value proposition and has enabled us to offer our services at very competitive prices.”
Mexico has seen strong growth in its virtual operator market. The IFT estimated that MVNOs would end 2023 with 13.3m lines, 2.5mn more than at the end of 2022.
Some 61% of the MVNOs surveyed by the regulator said they have agreements involving the shared network.
According to Diri, it is projected that 20% of the market will have a line operated by an MVNO by 2030.
eSIM
The company promotes the use of eSIM cards, which allows the entire mobile service to be managed virtually. In the last month, more than half of the company's new users in Mexico were using eSIMs.
“This avant-garde positioning has been an important differentiator,” Amerlinck said, adding "There's a lot of demand for this product.”
Although the range of devices compatible with eSIMs are still high-end, the company says it does not see significant limits in terminals since replacement of devices means that there are more and more compatible phones on the market.
Source: https://www.bnamericas.com/en/news/mexican-mvno-diri-aiming-for-1mn-latam-users-by-end-2024