The Virgin Mobile brand was officially launched by Emirates Integrated Telecommunications Company (EITC) on September 5 in the UAE, making history as the first fully digital mobile service in the country. Karim Benkirane, Managing Director of Virgin Mobile UAE, said the brand has ditched tradition by operating exclusively through a mobile app.
The Virgin Mobile UAE app signifies a paradigm shift in the mobile industry, digitally designed to simplify life for residents and citizens. The unique Virgin Mobile distribution model allows customers to simply download an app and have a SIM card delivered to them within an hour. The digital experience gives Virgin Mobile UAE customers new levels of flexibility and convenience.
Ever since the launch of Virgin Mobile in the UAE many people have questioned the relationship between du and Virgin Mobile, and whether the two brands will compete head-to-head or work together. Karim insists that Virgin Mobile as a brand will complement du because the two brands will work together to target different segments of the market in the UAE.
"Virgin Mobile is targeting the tech-savvy segment," he said. "We have a fully digital business model which is app-based and serves the new needs of this segment. Virgin Mobile is a niche market brand and du is a mass market brand. We are targeting just a small part of the consumer segment."
Further addressing Virgin Mobile UAE’s relationship with du, Karim said "one plus one equals three". Virgin Mobile UAE is "targeting the growing tech-savvy segment in the UAE. Virgin Mobile and du are collaborating as two business units under the same umbrella - there is synergy and collaboration and alignment between the two brands," he said.
The important thing to remember about Virgin Mobile UAE, however, is that it’s not a telecom operator and it also isn’t an MVNO (mobile virtual network operator). Virgin Mobile in Saudi Arabia, which Karim previously led as CEO, is an MVNO, whereas Virgin Mobile UAE is simply a brand as part of Emirates Integrated Telecommunications Company, the parent company of "du".
"It’s only EITC that has a license and they are the operator - we don’t have one," Karim confirmed to Telecom Review. "We are simply a brand of EITC alongside the du brand. We are the third mobile brand in the UAE market. The Virgin Mobile brand is known as an MVNO in other markets but that’s not the case here. We are controlled, managed and owned by EITC."
MVNO’s go through a license process with telecom regulators, which was the case with Virgin Mobile in Saudi Arabia. MVNO’s have a wholesale agreement with a host network so that they can use the host’s infrastructure. That’s not the case for Virgin Mobile in the UAE.
How does an app-based mobile service work?
Virgin Mobile UAE is unique in the sense that it doesn't require customers to visit a physical store. Everything to do with your mobile plan is done through the app that was built by the Virgin Mobile UAE team. To join, you can simply download the app, register your details, and then choose your monthly plan (data package, international calling, international roaming, etc).
One of the most unique aspects of the app-based service is that you can edit your mobile package every month to suit your needs. For example, if you set your data plan at 1GB per month and realize it's not enough, you can change it to 2GB (or higher/lower) for the next month. It's important to note, though, that changes made to a plan won't be implemented until the current plan has finished after 30 days.
"We have a strategy to make things as simple as possible for the consumer," said Karim. "That means, technically, there is complexity on our side. Getting customers to download the app through Google Play or the App Store is a big shift in the telecom industry. We decided to take this innovation to the UAE market making us the first to do so in the country’s telecommunications history."
Karim added, "The customer can import their old number through the app; they can upgrade/downgrade their mobile plan through the app; they can pause their plan for when they’re traveling; and they can even select roaming packages through the app."
When it comes to pricing, he said the business unit wanted to provide flexibility to ensure savings for customers, because a combination of wanting more simplicity and cheaper rates is why majority of customers choose to opt for a different mobile brand. Virgin Mobile UAE provides a tool for customers to play with and adjust their mobile plans so that they can then save money based on their specific needs.
"The Virgin Mobile business unit is an innovation lab. Whatever we do here should be a first," said Karim. "This is our strategy. When you look at the UAE market and how it has embraced digital transformation, we realized that our strategy fit well with the ecosystem here. We decided to go fully digital and be credit card-based to make the experience better and make sure that customers can do whatever they want through the app and not have to change their plan in-store."
Payment for the mobile package is completely digital. When signing up, you must state whether you're a visitor or a resident. This is a breakthrough feature for tourists coming to the UAE. Etisalat and du require Emirates identification to start a mobile plan which is often inconvenient for new arrivals to the UAE and tourists who want to temporarily use a local mobile network to make calls and use data. Once you've registered your mobile plan (residents must scan a copy of their Emirates ID), your SIM card will be delivered directly to you.
If you're a Virgin Mobile UAE customer and planning to travel abroad, you can pause your plan until you get back, rather than paying for a whole month's worth of unused service. You can also customize your roaming package by selecting the country you plan to visit and choose your package. A unique feature is that the roaming package won't begin until you start using the service in that country.
Since Virgin Mobile UAE is fully digital, the business unit had to find a way of delivering SIM cards to customers so that they don’t have to visit a physical store. To do this, Virgin Mobile UAE partnered with two companies: Careem and Carry.
"We partnered with ride-hailing company Careem which is for logistics - the company facilitates the delivery of the SIMs," Karim explained. "The person who delivers the SIM card activates it via an app we provide." Drivers have an app that scans the customer's information and then activates their SIM card. All Virgin Mobile UAE SIM cards are blank until a customer's mobile plan is uploaded.
"We train all the drivers on the activation process and we make the process as easy as possible," Karim added. "SIMs are activated within less than two minutes."
Virgin Mobile UAE also partnered with Carry, a logistics company, to schedule the home deliveries - customers can schedule a delivery within 12 hours or 24 hours. "We challenged ourselves and our partners because we wanted to be able to deliver our product within one hour," Karim said. "This is the digital transformation of two infrastructures to make sure we can deliver the best experience for our customers."
Virgin Mobile UAE faces stiff competition in the mobile market, particularly with the introduction of Etisalat-owned Swyp, a prepaid mobile service targeting the youth segment. Swyp will only be available for customers aged between 15 and 29. Karim said he doesn’t see the introduction of Swyp as negative for Virgin Mobile UAE however; in fact, he sees it as being "good for the industry."
"It highlights the importance of competing to offer the best customer experience rather than competing to offer the best pricing," he said. "It is healthy competition and it’s also a new area where innovation will grow and get more attention."
Karim added, "Our current focus is to get the app service experience right for our customers and listen to the market to fine-tune the product day-by-day. We are trying to build a digital platform plus processes that can allow us to become agile and thus improve things much faster."
The major challenge Virgin Mobile UAE faces going forward, he explained, is the expectation coming from the market for simplicity and convenience. During the beta phase of Virgin Mobile UAE the business unit received a lot of feedback which pushed the team to improve the service quickly and understand what needed to be changed.
Karim said, "The ultimate hurdle we face is challenging digital infrastructure to deliver a simple experience for the customer."
The Virgin Mobile UAE app can be downloaded via Google Play and the Apple App Store. For now, the brand is focusing on Abu Dhabi, Dubai and Sharjah, Karim said, and because it's such a new service, he couldn't offer any details about user numbers or revenue at this stage.
