Helmy Thesis Draft 17_Printed for Delivery

7/30/2019 Helmy Thesis Draft 17_Printed for Delivery

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Mobile Virtual Network Operators acceptance in Egypt

By

Mohamed Sayed Helmy

Supervised by

Dr. Saneya El-Galaly

This paper was submitted in partial fulfillment of therequirements for the degree of

MASTER OF BUSINESSADMINISTRATION(MBA)

at

Maastricht School of Management, MsMMaastricht, The Netherlands


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ACKNWOLEDGMENNT

I owe all the gratitude to God for putting me on the MBA road and helping me finish it.

The journey was short in time but rich in personal and technical experience, thanks to all my

Father and Mother, myWife and my littleYousseffor their love, patience and support before

and through the MBA time.

Thanks to Dr. Saneya El Galaly, her extra ordinary support, patience and advice enlightened my

way and made this thesis possible; I think she is simply the best supervisor.

I would like to thankAshraf Elsafty my research assistant who pushed me when I was late, and

simplified the difficult areas for me.

Thanks to my friend Khaled Magdy for his support, he is the statistics magician who unlocked

the SPSS for me.

And finally, warm thanks to all professors teachers and assistants at MSM, whom with theirsupport during the past years, I broadened my spectrum of business knowledge.


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ABSTRACT

Mobile Network Virtual Operator is a recent business model in the telecom industry that enables

non telecom players to utilize their brands in the telecom business and resell mobile minutes and

mobile services directly to customers, this model has succeeded in North America, Europe and

few Asian countries but it is not significantly present in the Gulf and north Africa region, and not

in Egypt specifically.

Egypt has many factors that facilitate Mobile Virtual Operators inception, so it is expected itstarts soon, brand owners and business firms that intend to join the mobile business may not

know if customers will have the intention to use mobile services from an absolute non telecom

player that might be a media service provider, a retail chain or even a fashion brand; Objective of

this research is to find out if the Egyptian customers would accept Mobile Virtual Operators

concept.The research uses a model based on constructs from the Unified Theory of Acceptance and Use

of Technology (Venkatesh, 2003) that were adapted for the research topic and local market, and

complemented with components from another use intention model (Mallat, 2008) such as cost

and trust.

This study shows that there are specific factors that affect the customers intention to use theMobile Virtual Operator such as: innovative services and offers, effort expectations, trust and

switching cost.

The outcome of this research means that new virtual operators shall consider offering innovative

services, high quality voice communications, attractive offers; they shall also consider that users

trust in their brand will strengthen their intention to use, and compensate customers for the cost

of switching from their current mobile operator, last but not least virtual operator shall provide

an extraordinary customer care service as it might be a key differentiator against other operators.


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TABLE OF CONTENT

ACKNWOLEDGMENNT ................................................................................................................................IIABSTRACT.....................................................................................................................................................IIITABLE OF CONTENT ...................................................................................................................................IVLIST OFTABLES .........................................................................................................................................VIILIST OF FIGURES ......................................................................................................................................VIIILIST OFABBREVIATIONS ............................................................................................................................IX1. CHAPTER1:INTRODUCTION............................................................................................................. 1

1.1 An overview ................................................................................................................................. 11.2 Problem Definition ..................................................................................................................... 11.3 Research Objective ...................................................................................................................... 11.4 Theoretical Framework .............................................................................................................. 1

1.4.1 Model variables .................................................................................................................... 2Dependent variable ............................................................................................................................. 2Independent variables ........................................................................................................................ 21.4.2 Research assumptions ........................................................................................................ 31.4.3

Research limitations ............................................................................................................ 3

1.5 Research questions ...................................................................................................................... 3

1.5.1 Major questions ................................................................................................................... 31.5.2 Minor questions................................................................................................................... 3

1.6 Research Methodology ............................................................................................................... 41.6.1 Research type ....................................................................................................................... 41.6.2 Sampling ............................................................................................................................... 41.6.3 Data analysis method .......................................................................................................... 4

1.7 Thesis Structure ........................................................................................................................... 52 CHAPTER 2 LITERATURE REVIEW 6


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2.2.2 Technology Acceptance Model ....................................................................................... 112.2.3

Unified Theory of Acceptance and Use of Technology ............................................. 12

2.2.4 Is UTAUT suitable and reliable? .................................................................................... 152.2.5 Mallat Use Intention model ............................................................................................. 15

2.3 Previous research & Cases ....................................................................................................... 172.3.1 Mobile Virtual Operators strategy .................................................................................. 172.3.2 Mobile Virtual Operator services acceptance ............................................................... 182.3.3 Gaps in the research ......................................................................................................... 18

2.4 Local case/Business .................................................................................................................. 182.4.1 Market preconditions ....................................................................................................... 182.4.2 Mobile Virtual Operators in Egypt ................................................................................ 19

3. CHAPTER3:THEORETICAL FRAMEWORK AND RESEARCH DESIGN .......................................... 203.1 Introduction ............................................................................................................................... 203.2 Problem definition .................................................................................................................... 203.3 Research objective ..................................................................................................................... 203.4 Theoretical framework ............................................................................................................. 20

3.4.1 Dependent variables ......................................................................................................... 213.4.2 Independent variables ...................................................................................................... 213.4.3 Moderating variables......................................................................................................... 233.4.4 Research assumptions ...................................................................................................... 233.4.5 Research limitations .......................................................................................................... 23

3.5 Research questions .................................................................................................................... 233.5.1 Major questions ................................................................................................................. 233.5.2 Minor questions................................................................................................................. 233.5.3 Hypothesis ......................................................................................................................... 24

3.6 Research methodology ............................................................................................................. 25


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4.2.1 Variables and Constructs data ......................................................................................... 314.3 Inferential analysis ..................................................................................................................... 38

4.3.1 Reliability tests ................................................................................................................... 384.3.2 Internal correlation analysis ............................................................................................. 404.3.1 Variable correlation analysis ............................................................................................ 434.3.2 Moderating variables......................................................................................................... 44

4.4 Discussion and findings ........................................................................................................... 445. CHAPTER5:CONCLUSION,RECOMMENDATION AND FUTUREWORK..................................... 47

5.1 Recommendations ..................................................................................................................... 475.2 Future work ................................................................................................................................ 48

REFERENCES ............................................................................................................................................... 49APPENDIXA:SMES PROFILES.................................................................................................................. 53APPENDIXB:EXPERTS SEMI-STRUCTURED QUESTIONNAIRE............................................................ 54APPENDIXC: CONSOLIDATED EXPERTS INTERVIEW RESPONSE......................................................... 57APPENDIXD:THE QUESTIONAIRE.......................................................................................................... 61APPENDIXE:OPERAIONALIZATION OF MODEL CONSTRUCTS: .......................................................... 65APPENDIXF:MAPPING OF SPSS VARIABLES TO HYPOTHESIS, CONSTRUCTS, AND QUESTIONNAIRE

QUESTIONS .................................................................................................................................................. 67


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LIST OF TABLES

Table 2.1 - Worldwide MVNO examples................................................................................................. 7Table 2.2 - Technology acceptance sample researches ........................................................................... 9Table 2.3 UTAUT variables & constructs definitions ...................................................................... 13Table 3.1 - Questionnaire mapping of Hypotheses-Constructs-Questions ...................................... 27Table 4.1 - Descriptive Statistics for Services Construct ................................................................. 31Table 4.2 - Descriptive Statistics for Services construct .................................................................. 32Table 4.3 - Descriptive Statistics for Perceived usefulness construct ............................................ 32Table 4.4 - Descriptive Statistics for Offers construct ..................................................................... 33Table 4.5 - Descriptive Statistics for Complexity construct ............................................................ 34Table 4.6 - Descriptive Statistics for Network specifics construct ................................................. 35Table 4.7 - Descriptive Statistics for Social Influence construct .................................................... 35Table 4.8 - Used mobile operators .......................................................................................................... 37Table 4.9 - Reliability reference ................................................................................................................ 38Table 4.10 - Reliability measurements..................................................................................................... 39Table 4.11 - Correlations of Performance Expectancy items .............................................................. 40Table 4.12 - Correlations of Effort Expectancy items ......................................................................... 42Table 4.13 - Correlations of Social Influence items .............................................................................. 42Table 4.14 - Variable Correlarion - Spearman Rho............................................................................... 43Table 4.15 - Hypothesis finding ............................................................................................................... 44Table F.1 - Mapping of SPSS variable to questionnaire items ............................................................ 67


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LIST OF FIGURES

Figure 1.1 - Proposed thesis model ........................................................................................................... 2Figure 2.1 - TRA (Fishbein, 1975).......................................................................................................... 10Figure 2.2 - TPB (Ajzen, 1991) ................................................................................................................ 11Figure 2.3 - TAM (Davis, 1989) ............................................................................................................... 12Figure 2.4 - UTAUT (Venkatesh et al., 2003) ........................................................................................ 13Figure 2.5 - Mallat Use Intention model (Mallat et al., 2008) .............................................................. 16Figure 3.1 - Proposed thesis model ......................................................................................................... 21Figure 4.1 - Descriptive Statistics for Gender ................................................................................... 31Figure 4.2 - Descriptive Statistics for Age .............................................................................................. 31Figure 4.3 - Descriptive Statistics for Job fit construct .................................................................... 33Figure 4.4 - Descriptive Statistics for PEOU construct ................................................................... 34Figure 4.5 - Descriptive Statistics for Social factor construct ......................................................... 36Figure 4.6 - Descriptive Statistics for Trust construct...................................................................... 36Figure 4.7 - Descriptive Statistics for Cost construct ....................................................................... 37Figure 4.8 - Use Intention ......................................................................................................................... 38


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LIST OFABBREVIATIONS

ARPU Average Revenue Per User

FMCG Fast Moving Consumer Goods

HLR Home Location Register

ITU International Telecommunications Union

MCIT Ministry of Communications and Information Technology, Egypt

MOTC Ministry Of Transportation and CommunicationsMSC Mobile Switching Center

MVNE Mobile Virtual Network Enabler

MVNO Mobile Virtual Network Operator

NTIA National Telecommunication and Information Administration

PEOU Perceived Ease of UsePU Perceived Usefulness

VAS Value-Added Service

VOIP Voice Over Internet Protocol

SME Subject Matter Expert

TPB Theory of Planned Behavior

TRA Theory of Reasoned Action

UTAUT Unified Theory of Acceptance and Use of Technology


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1.CHAPTER 1: INTRODUCTION

1.1AN OVERVIEW

Mobile Virtual Network Operators (MVNO) is a new business model that enables brand owners

-who have neither telecom experience nor huge investments- to provide mobile services under

their own brand by using the already established mobile operators network infrastructure in the

backend, this model allows such brand owners to utilize their brand power for marketing mobile

services without the need to invest time and funds to build sophisticated telecom networks.

MVNOs have been in operation over the last decade in Europe, Australia, USA and some Asian

countries, in the past four years two Arab countries have experienced the MVNO, there have

been a specific set of conditions in all the countries were MVNOs have succeeded, such

conditions are available in Egypt, thus it is probable that MVNO business will be established

soon in Egypt, in such case will Egyptian customers accept such model? This is the question

behind this thesis.

1.2 PROBLEM DEFINITION

Egypt is nominated from industry prospective to have new mobile virtual network operators, butit not confirmed if there would be customer intention to use them in case they are launched, thus

it is necessary to check if that intention exists prior to establishing such business in Egypt.

1.3 RESEARCH OBJECTIVE

The objective of this research is to check if the mobile customers in Egypt will accept MobileVirtual Network Operators in case they operate in Egypt.

Knowledge about the user intention will be helpful to business firms to decide if to go in to such

business or not, and if yes, to determine the measures to be taken to satisfy their customers

d


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H1

H3

Figure 1.1 - Proposed thesis model

1.4.1 Model variables

Dependent variable

Intention to use MVNO: it is the customer likelihood of subscribing to MVNO


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Effort Expectancy: is defined as the degree of ease associated with the use of the system

Social influence: is defined as the degree to which an individual perceives that importantothers believe he or she should use the new system.

1.4.2 Research assumptions

Assumption 1: There are no regulatory barriers e.g. exclusivity rights for the incumbent Mobile

operators

Assumption 2: Social and economic factors are assumed constant during the survey

Assumption 3: Research is limited to users who already have a prior experience with mobile

usage

1.4.3 Research limitations

Lim1: Limited to Egypt as applied researchLim2: Research is limited to users who already have a mobile line

Lim3: Geographical coverage in Cairo

Lim4:The theoretical framework is limited to the variables included in the model.

1.5 RESEARCH QUESTIONS

1.5.1 Major questions

MjRQ1: Will the Mobile users in Egypt have intention to use MVNO services?

1.5.2 Minor questions

MinRQ1: Does the Performance Expectancy from an MVNO affect the user intention to usean MVNO?

MinRQ2: Does the user Trust in MVNO affect the user intention to use an MVNO?

MinRQ3: Does the Cost associated with MVNO affects user intention to use MVNO?


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MinRQ9: Does the Gender influence the relation between Performance Expectancy and the

user intention to use an MVNO?

MinRQ10: Does the Gender influence the relation between Trust and the user intention to use

an MVNO?

MinRQ11: Does the Gender influence the relation between Effort Expectancy and the user

intention to use an MVNO?

1.6 RESEARCH METHODOLOGY

1.6.1 Research type

Paradigm: quantitative

Purpose: exploratory, descriptive

Logic: deductiveProcess: Quantitative

Outcome: applied

Time horizon: cross-sectional

1.6.2 Sampling

I - Subject Matter Experts interviews:

Population I

Sampling method: Non-Probability Sampling

Sampling Criteria: Judgmental Sampling

Sample Size: 9

II- Questionnaire:

Population II (for the questionnaire)




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statistical methods used are non parametric Correlation analysis (Spearman Rank) and hypothesis

testing when needed.

1.7 THESIS STRUCTURE

The thesis is delivered in five chapters; Chapter 1 is the introduction providing an overview of

the research, problem definition, and research objective. Then, a brief description of the

theoretical framework, its components, research major and minor questions. Finally the research

type, sampling, and data analysis method used in the research are mentioned. Chapter 2 covers

the state of the art, where relevant theories upon which the researcher will base the research is

shown, including the whole literature review supporting the further research discussions and

analysis; so that the reader will be properly oriented to go further into the research. Chapter 3 is

the theoretical framework: it covers the research design, explained briefly in Chapter one, and

will be interpreted in depth including all justification needed for the relevant models factors, and

the resulting questionnaire and interview questions that will be used to collect data required for

the analysis. Chapter 4 includes data collection, data analysis methods, findings, and

interpretations. Finally, Chapter 5 provides the final conclusion and the recommendations based

on the findings and their interpretations and further research areas to be targeted in the future.

Appendices at the end of the documents provide


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2.CHAPTER 2: LITERATURE REVIEW

2.1 INTRODUCTION & INDUSTRY OUTLOOK

2.1.1 MVNO Definition

Mobile Virtual Network Operator (MVNO) is a new business model that started to appear in the

telecom marker in the past decade.According to the International Telecommunication Unions (ITU) definition, MVNO is an entity

that:

Offers mobile services to customers;

Has it own mobile network code;

Issues its own SIM card;

Operates its own MSC and HLR (not mandatory, it may leave this to the MNO;

Does not have its own radio frequency spectrum. (ITU, ca. 1999)

In other less technical words:

The MVNO is a mobile service provider that does not own a licensed Radio spectrum, may not

have the full network infrastructure; it rather rents capacity or buys wholesale minutes from anestablished mobile service provider and markets it under its own brand name independently from

the main/original provider (Criceli, L. et al., 2009)

There is no strict definition for the borderline for the scope of responsibilities and technical

systems split between the MVNO and an MNO, it can vary from a very thin MVNO that

handles only marketing and reselling of minutes ( so called airtime), or an MVNO that gets moreinvolved in operational aspects and owns its customer care billing systems and even its Value-

Added Services platforms like messaging services, up to a fully fledged MVNO that runs its own

billing and customer care, switching and long distance transmission systems. (Guey Lan Fu, 2007)


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complements the MNO marketing weakness, where MVNOs has all the time to manage their

customer relations and demands with no concern on network management issues in the

background. (Guey Lan Fu, 2007)

2.1.2 Scope of the study

This thesis is evaluating the potential user acceptance or intention to adopt MVNO in case such

business model is introduced in Egypt; user acceptance is approached from a new technology

acceptance prospective

The MVNO acceptance in Egypt can be studied from another prospective not covered in this

thesis- which is the brand extension aspect. MVNOs will be non telecom brand owners that go

probably for the first time- into the telecom business domain, the original brand and its

established reputation will naturally affect the new area they are going into.

2.1.3 Significance of the research

For a business owner or investor, it would be necessary to check and validate the existence of

customer acceptance of that new business model in any target country before launching such

business

2.1.4 Mobile Virtual Operators overview worldwide

MVNOs have started to operate since 2000 in the US, Europe, Australia and some Asian

countries, there have been many brands that went into the MVNO business some of them

succeeded and many failed to continue, it can be noticed that only two countries have launched

MVNOs in the Arab region since 2005

Examples of these MVNOs are listed in Table 2.1. (Telecom Paper website, 2009)

Table 2.1 - Worldwide MVNO examples

MVNO Original brand Countries operating in Target


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Auchan, Super market chain France, Italy

Aldi Super market chain Germany

Sainsbury Telecom Super market chain UK

Tesco Super market chain Ireland, UK

Samatel Solely an MVNO Oman

Reference (Telecom Paper website, 2009)

2.1.5 Mobile Virtual Operators strategies

MVNOs were expected to be the hanging fruit in the Telecom market, high expectations were

marketed by industry specialist and visionaries, especially in markets that have reached a high

level maturity and are saturated or over saturated (Shea, 2005; Kelly, 2006)

To the contrary of these optimistic expectations, MVNO failure stories have started to unfold

here and there, of course the MVNO strategy plays a major role in determining its destiny

MVNO strategies differ according to the market environment, the MVNO brand and the

company vision. Some MNOs prefer to take the easy way and use a cost leadership strategy in

which they buy minutes from the MNO at wholesale rates and resell it to subscribers at a

discounted price, they lower their operating and marketing expenses, usually by offering no value-

added services and little or no options, this model usually targets ethnic groups offering themlower rates for calling their home countries, economy of scale is the only way to make profit

from this strategy i.e. acquisition of significant market share which is not typically easy against the

big operators who have much better financial capabilities and can launch aggressive marketing

campaigns and sustain temporarily losses even for long period in a price war to close down those

small MVNO competitors.Some other MVNOs follow a product differentiation strategy, in which they address a niche

market segment thats willing to pay for specially tailored services that no one else has in the

market (Kumar et al, 2010), example of these MVNO target specific niches are mentioned in


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Business practice proved that the product differentiation strategy and brand utilization give better

chances to sustain the business compared to cost leadership strategy.

2.2THEORIES DEFINED

The objective of this thesis is to assess if the mobile users in Egypt will have the intention to use

mobile services from MVNOs, considering that MVNO will offer new services and advanced

features this literature review will focus on researches and theories related to technology

acceptance, user intention and adoption of new technologies.

Several theories have been developed to study the acceptance, adoption and diffusion of new

technologies;

Theory of Reasoned Action (Fishbein and Ajzen, 1975)

Theory of Planned Behavior (Ajzen, 1991)

Technology Acceptance Model (Davis, 1989)

Unified Theory of Acceptance and Use of Technology (Venkatesh et al., 2003)

Such theories were deployed to examine the acceptance and adoption for mobile services,

examples:

Table 2.2 - Technology acceptance sample researches

Author Year Topic/ Field Applied theoriesFan et al. 2005 Speech interface an

enhancer to the

Acceptance of mobile

Commerce

applications

TAM, and other

factors available in the

literature

Luaren

and Lin

2005 Mobile Banking TPB, TAM, other

factors in theliterature

Marchewka J. T. et al 2007 Educational course

management software

UTAUT

Mallat et 2008 Mobile TAM


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2.2.1 Theory of Reasoned Action & Theory of Planned Behavior

The Theory of Reason Action (Ajzen, 1975) proposes that persons behavior towards a specific

issue depends on three main constructs:

1) Persons behavioral intention, that primarily depends on

2) Persons attitude towards the behavior, and

3) Subjective norms relevant to that specific behavior

Evaluative

aspect of beliefs

about

consequence

Intention

To Use

Actual

Behavior

Normative belief

about what

others expect

Attitude towards

the Behavior

Motivation to

comply with

normative beliefs

Subjective

Norms

Beliefs about

consequences of

engaging in the

behavior

Figure 2.1 - TRA (Fishbein, 1975)

The TRA theory was enhanced later on by its author yielding the Theory of Planned Behavior(Ajzen, 1991), the additional element in the TPB is the perceived behavioral control that affects

the intention and affects directly the behavior itself.

Either of these theories TRA & TPB measure the intention as an intermediate dependent variable,


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Figure 2.2 - TPB (Ajzen, 1991)

2.2.2 Technology Acceptance Model

The Technology Acceptance Model was developed by Davis in 1989 attempting to predict how

much the end user accepts a new technology, TAM is one of the famous models dealing with

technology acceptance; it is considered an adaptation of the theory of reasoned action.

The two main constructs in the TAM are Perceived Usefulness (PU) and Perceived Ease Of Use(PEOU), perceived usefulness represents the degree to which the user feels that using a

particular service/system would enhance his/her job performance, while perceived ease of use

represents the degree to which the user feels that using a particular service/system would be with

minimal effort (Davis, 1989)

The TAM has evolved to the TAM2 by adding the subjective Norms as a new variableaffecting individuals acceptance of technology, it was proven that subjective norms has a

significant effect on the individuals use intention (Venkatesh and Davis, 2000)

Considering the amount of new services and features that an MVNO will be offering as indicated


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Figure 2.3 - TAM (Davis, 1989)

2.2.3 Unified Theory of Acceptance and Use of Technology

The UTAUT (Venkatesh et al., 2003) was an attempt to construct a single model combined from

the available technology acceptance models at the time of its development; it considered the

conceptual and empirical similarities; and inherited the core constructs and the moderating

variables from these models and theories:

Theory of reasoned action

Theory of planned behavior

Technology acceptance model

Motivational model

Technology acceptance model combined with the theory of planned behavior

Model of PC utilization

Innovation diffusion theory

Social cognitive theoryThe UTAUT model proposes three direct determinants of intention to use:

Performance expectancy

Effort expectancy


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Gender

Age

UTAUT model is depicted in Figure 2.4

Figure 2.4 - UTAUT (Venkatesh et al., 2003)

UTAUT constructs are listed in Table 2.3

Table 2.3 UTAUT variables & constructs definitions

Construct DefinitionPerformance ExpectationsPerceivedU f l

The degree to which a person believes that using a particular system wouldh hi h j b f


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understand and use.Ease of Use The degree to which using an innovation is perceived as being difficult to

use.Social InfluenceSubjective Norm The persons perception that most people who are important to him think

he should or should not perform the behavior in question.Social Factors The individuals internalization of the reference groups subjective culture,

and specific interpersonal agreements that the individual has made withothers, in specific social situations

Image The degree to which use of an innovation is perceived to enhance onesimage or status in ones social system.

Facilitating ConditionsPerceived BehavioralControl

Reflects perceptions of internal and external constraints on behavior andencompasses self efficacy, resource facilitating conditions, and technologyfacilitating conditions.

Facilitating Conditions Objective factors in the environment that observers agree make an act easyto do,including the provision of computer support

Compatibility The degree to which an innovation is perceived as being consistent with

existing values, needs, and experiences of potential adopters

Effect of moderating variables:

According to UTAUT: Age, gender, and experience were found to have effect on the strength of

the relationship effort performance expectancy and behavioral intention; age and gender

contribution was much significant than experience moderator that was found to be non

significant moderator.

All moderating variables were found to be non significant in affecting the relationship between

social influence and behavioral intention

Thus in this research the moderating variables will be limited only to age and gender

The UTAUT model does not consider the cost, trust and risk as independent variables affecting

intention or usage behavior

The UTAUT was developed in an organizational environment, Venkatesh study examined four

population groups of individuals that worked in four different organizations; some researchers


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2.2.4 Is UTAUT suitable and reliable?

The UTAUT was used extensively in measurement of usage intention for new technologies;

UTUAT was used successfully in studying the adoption of mobile services (Carlsson C., 2006;

Marchewka J. T. et al, 2007); it was used specifically in studying MVNO acceptance by (Dong-

Hee Shin, 2010) who proved that the model is valid for this research topic in the US market.

The UTAUT was proven to be usable across different cultures in North America, East Europe,

West Europe, Asia, and Middle East; and it can survive translation and being ported to different

languages Arabic, English, French, Malay, Czech, Dutch, and Greek (Oshlyansky L. et al., 2007);

thus it would be safe to use the UTAUT model in this research in Egypt

The UTAUT has been proven to valid, reliable and suitable for studying technology adoption in

many researches (Anderson, J. et al., 2004; Lin, K., 2005; Rosen, P., 2005)

2.2.5 Mallat Use Intention modelAnother model consolidation attempt was done by Mallat et al. (2008, pp.5765) to build a model

based on the constructs of two theories in the information systems adoption literature: TAM and

IDT, The result was the following model depicted in Figure 2.5. This model was used to study

the adoption of mobile ticketing in public transport in Finland, components of this model are:

Compared to UTAUT, this model accommodates few extra variables: Cost, Trust, Risk, Usecontext and mobility which are relevant to the mobile service context (Mallat et al., 2008).

This model have been used to examine the mobile ticketing adoption in Finland Mallat, 2008)

and also in an another research in Iran (Babaee N., 2010), in which the prior experience was the

most effective factor in the use intention, and afterwards came risk, perceived usefulness, ease of

use, trust, use context, and mobility at lower level of importance, then at last came the attitude,social influence, compatibility and cost.

Cost

Despite the cost is not a common construct in the technology acceptance research area, it was


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or service provider on the other side (Pavlou, 2003; Mallat et al., 2008). Moreover, the user has to

surrender personal sensitive information such as his/her home address, phone number(s), and

credit card number (Grabner-Krauter and Kaluscha, 2003).

Trust in other parties is announced to be a set of persons beliefs or perceptions about the trusted

party characteristics that indicate trustees behavior, such beliefs include evaluation of the trusted

partys capabilities, benevolence and integrity (Bhattacherjee A., 2002)

The following limitations have to be noted regarding this model:

Only the direct relationships between the eleven variables and the use intention, while the

interdependencies between all the eleven variables were not hypothesized nor tested

The whole model was used only in the mobile ticketing field

2.3PREVIOUS RESEARCH & CASES

Many theories and models were used to study diffusion and acceptance of new brands and/ornew technologies in various conditions, in quest for finding a model to answer the question of

this research, previous work is reviewed in this chapter.

2.3.1 Mobile Virtual Operators strategy

MVNO is one of methods to increase competition in the telecom market and accordingly boost

its economy, according to Taiwan Ministry of Telecommunications, every one Dollar invested in

the telecommunication field results in an overall multiple effect of 2.89 Dollar increase in the

GDP (Taiwan MOTC, 2007)

Important factors are recommended to be considered for the success of an MVNO, and actually

to telecommunication business in general:

Social aspect: more communication facilities available to everyone will help reducing the digital

divide, digital divide is the gap that exists between people in different geographical or economical

conditions in a having access to national information and resources (US NTIA, 1999)

E i li h l i di ifi i f l dd d i h i h i


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2.3.2 Mobile Virtual Operator services acceptance

One research done by Dong-Hee Shin in 2010 focuses on the customer acceptance for services

provided by the MVNO, not actually focusing on the technical aspects of these services or the

success factors of MVNO but rather on the end user acceptance for MVNO itself.

In that research, UTAUT model was applied to measure the use intention and the use behavior in

the US market, it is worth mentioning that the MVNO industry is one of the first and biggest

MVNO markets in the world (TeleGeography, 2008).

As the most relevant research paper to this thesis, it is worth to demonstrate its conclusion,

Dong-Hee Shin results show that perceived usefulness and perceived ease of use are the two

main variables affecting user intention, and then comes the switching cost in the next level

affecting the intention; the results show as well that actual usefulness and actual ease of use are as

important as the perceived features (Dong-Hee Shin, 2010)

2.3.3 Gaps in the research

As presented so far, many researchers have studies the MVNO from different aspects such as:

Competition and relation MVNO & MNO (Criceli, L. et al., 2009; Chyan Yang et al, 2005),

MVNO Success factors (Guey Lan Fu, 2007), regulatory rules, entry barriers and marketing

strategy recommendation (Kumar, 2010).However, Very few researches were found analyzing the customer acceptance for the MVNO, up

to the researchers accessible libraries and databases, one recent research was found that tried to

study MVNO business from customer acceptance prospective (Dong-Hee Shin, 2010)

2.4LOCAL CASE/BUSINESS

2.4.1 Market preconditions

In most of the markets where MVNO business has been established and sustained, the following

factors were identified:


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Many untapped customer segments.

Appearance of market failure symptoms due to lack of competition and collusion among

service providers.

First MVNO entrants acquired a decent market share compared to late entrants and

copiers.

Typically, two or three MVNOs are dominating this segment

MVNO are not directly competing with MNO in the same service portfolio, they rather

offer services that complement them (Kumar, 2010).

2.4.2 Mobile Virtual Operators in Egypt

In Egypt, ethnic MVNO is not feasible marketing strategy due to unavailability of significant

ethnic niches that can be exclusively addressed in separate ghettos or communities, in contrast to

other immigration countries like Canada or Australia that receives around 250,000 persons yearly

from 200 countries (CIC Canada, 2010)

However, With reference to the preconditions mentioned in section 2.4.1, Egypt is in a good

position to start the MVNO business for the following reasons:

Economy of scale, the high population is a potential for high number of subscriber

Segmentation, availability of different customer segments and

Very high penetration (91%) (MCIT, 2011)

Three incumbent mobile operators

Advanced regulatory body (currently studying the issue)

No MVNOs established yet

Good growth rate of GDP


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3.CHAPTER 3: THEORETICAL FRAMEWORK AND

RESEARCH DESIGN

3.1 INTRODUCTION

MVNO business model have succeeded in Europe, Australia, USA and some Asian countries,

typically in countries of high mobile penetration rate and other specific conditions (refer to

section 2.4.1), some Arab countries and specifically Egypt has many of the preconditions to have

such business model. Nevertheless, almost none of the Arab countries have an established

MVNO business except Oman and Bahrain.

MVNOs are sometimes perceived as inferior in quality to the MNOs due to their brand names

that are not associated with the telecom industry, actually in most cases MVNOs offer new

services or specially designed services to target niche customer segments, while in fact, an

MVNO uses the very same radio network infra structure of an MNO

Thus it is probable to have customer negative perceptions or even rejection to MVNOs in case

they decide to operate in Egypt, accordingly, this thesis will try to explore if the Egyptian

customer will have intention to use the MVNO.

3.2PROBLEM DEFINITION

Egypt telecommunication market is well prepared and qualified from industrial point of view to

have new mobile virtual network operators, however it is not confirmed yet if consumers will

accepts such new model of mobile operators

Thus it is necessary to check if there would mobile users acceptance for MVNO prior toestablishing such business in Egypt.

3.3RESEARCH OBJECTIVE


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the model was enriched by variables from Mallat model that has been supported by the SME

recommendations.

The proposed model for this Thesis is depicted in figure Figure 3.1 - Proposed thesis model:

H1

H3

Figure 3.1 - Proposed thesis model

3.4.1 Dependent variables


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Defined as: The degree to which a person believes that using a particular system would enhance

his or her live. (Venkatesh 2003)

Job FitDefined as: How the capabilities of a system enhance an individuals job performance.

(Venkatesh 2003)

Services

The MVNO provides innovative services that meet the mobile users needs

Network SpecificsThis construct relates to the network related attributes of the MVNO

Offers

This construct relates to the commercial offers provided by the MVNO

VAR (X2): Trust

Defined as: The user confidence to surrender their own personal data to a remote party, trusting

that such data will not be misused

VAR (X3): Cost

Defined as: The degree to which an individual believes that switching service providers would

incur certain cost to him or her (Shin et al, 2008).

VAR (X4): Effort Expectancy

Defined as the degree of ease associated with the use of the system (Venkatesh 2003), it consists

of two constructs

Perceived Ease of Use

Defined as: The degree to which a person believes that using a system would be free of effort.

(Venkatesh 2003)

Complexity

Defined as: The degree to which a system is perceived as relatively difficult to understand and use.

(Venkatesh 2003)

VAR (X5) S i l i fl


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Defined as: The degree to which use of an innovation is perceived to enhance ones image or

status in ones social system. (Venkatesh 2003)

3.4.3 Moderating variables

VAR (M1): Age

VAR (M2): Gender

3.4.4 Research assumptions

Assumption 1: There are no regulatory barriers e.g. exclusivity rights for the incumbent Mobile

operators

Assumption 2: Social and economic factors are assumed constant during the survey

Assumption 3: Research is limited to users who already have a prior experience with mobile

usage

3.4.5 Research limitations

Lim1: Limited to Egypt as applied research

Lim2: Research is limited to users who already have a mobile line

Lim3: Geographical coverage in Cairo

Lim4:The theoretical framework is limited to the variables included in the model.

3.5RESEARCH QUESTIONS

3.5.1 Major questions

MjRQ1: Will the Mobile users in Egypt have intention to use MVNO services?

3.5.2 Minor questions

MinRQ1: Does the Performance Expectancy from an MVNO affect the user intention to use

an MVNO?


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MinRQ8: Does theAge influence the relation between Effort Expectancy and the user


MinRQ9: Does the Gender influence the relation between Performance Expectancy and the

user intention to use an MVNO?

MinRQ10: Does the Gender influence the relation between Trust and the user intention to use

an MVNO?

MinRQ11: Does the Gender influence the relation between Effort Expectancy and the user


3.5.3 Hypothesis

H1o: There is no relationship between the user Performance expectancy from the MVNO and

the user intention to use its service

H1a:There is a positive relationship between the user Performance expectancy from theMVNO and the user intention to use its service

H2o:There is no relationship between the user Trust in the MVNO and the user intention to

use its service

H2a: There is a positive relationship between the user Trust in the MVNO and the user

intention to use its service

H3o: There is no relationship between the Cost associated with switching to MVNO and the

user intention to use its service

H3a: There is a negative relationship between the Cost associated with switching to MVNO and

the user intention to use its service

H4o: There is no relationship between the Effort Expected by the mobile user and the user


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H6o: TheAge has noinfluence on the relation between Performance Expectancy and the user

intention to use an MVNO

H6a: TheAge does influence on the relation between Performance Expectancy and the user


H7o: TheAge has noinfluence on the relation between Trust and the user intention to use an

MVNO

H7a: TheAge does influence on the relation between Trust and the user intention to use an

MVNO

H8o: TheAge has noinfluence on the relation between Effort Expectancy and the user


H8a: TheAge does influence on the relation between Effort Expectancy and the user intentionto use an MVNO

H9o: The Gender has noinfluence on the relation between Performance Expectancy and the

user intention to use an MVNO

H9a: The Gender does influence on the relation between Performance Expectancy and theuser intention to use an MVNO

H10o: The Gender has noinfluence on the relation between Trust and the user intention to use

an MVNO

H10a: The Gender does influence on the relation between Trust and the user intention to use

an MVNO

H11o: The Gender has noinfluence on the relation between Effort Expectancy and the user


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The logic of this thesis is deductive, as the proposed model was built using established theories

i.e. UTAUT and factors from Mallat

The used process is Quantitative and the outcome is applied, the findings is a set of

recommendations for telecommunication business entities and investors

Time horizon of this thesis is a cross-sectional study

3.6.2 Data collection instrument and source

I - Experts interviews:Interviews were conducted with Subject Matter Experts (SME) to investigate the following issues:

Check that Egypt is a good candidate for MVNO business since such business model is

not present in Egypt yet.

Check that the UTAUT model components are suitable for the Egyptian environment,

Mobile market and the MVNO topic Explore if any additional variables or items need to be considered in the study for

MVNO acceptance in the market.

Collect the items corresponding to constructs that might influence the customer intention

to use an MVNO

The SME interview questionnaire is detailed in Appendix B: Experts Semi- Structuredquestionnaire.

II- Questionnaire:

A self administered questionnaire was used in this thesis; the questionnaire was launched and

administered on the Internet to

The respondents were targeted through e-mail chains to friends, relatives and co-workers andsocial networks

A first pilot questionnaire was sent to 5 persons; individual comments were collected from them

via e-mails or phone calls regarding unclear questions or typing corrections, enhancements were


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Table 3.1 indicates the mapping allocation of questionnaire questions to each Hypothesis and

construct

Table 3.1 - Questionnaire mapping of Hypotheses-Constructs-Questions

Research

QuestionHypothesis

Model

Variables

Construct Questionnaire

questions

MinRQ1 H1 Performance Expectancy Services 1-12

MinRQ1 H1 Performance Expectancy Perceived

Usefulness

13-14

MinRQ1 H1 Performance Expectancy Job fit 15

MinRQ4 H4 Trust Perceived Easeof Use

16

Performance Expectancy Network specific 17-20MinRQ3 H3 Performance Expectancy Offers 21-22

MinRQ4 H4 Trust 23MinRQ4 H4 Effort Expectancy Complexity 24-26

MinRQ5 H5 Image 27-28

MinRQ5 H5 Social Influence Social factor 29

MinRQ3 H3 Cost Cost 30

MjRQ1 Behavioural Intention 31

3.6.3 Sampling methods

I - Subject Matter Experts interviews

Population I



Sample Size: 9

Th f ll i i i d f l i h SME


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The interviews were done by the researcher himself according to planned meetings with the

SMEs at their convenience, SME were offered the choice to mention their names or to stay

anonymous in the thesis document.

The interviews were semi-structured, they were guided by the main constructs of the UTAUT i.e.

performance expectancy, effort expectancy, and social influence.

Interviews lasted from 30 to 45 minutes, ended with grateful thanks from the researchers

II- Questionnaire

Population II (for the questionnaire)



Sample Size: 96

The target population for this thesis satisfies the following criterion:Egyptian or foreigner, resident in Cairo, has internet access, own a mobile line, and above 14

years of age.

17.8 Million People are residents in Greater Cairo area (Maps of World, 2010; Wikipedia, 2010).

32.7% of Egypt population is below 14 years old (CIA fact book, 2011), this leaves 67.3% above

14 years old.Mobile penetration in Egypt is 91% (MICT, 2011), Actually the real mobile penetration might be

a bit less than 91% due to the multi SIM phenomena whereby some persons owns more than one

SIM card (mobile line) from different operators which leads to some inflation in the penetration

rates, this penetration ratio will be adjusted by -10% which is the minimum over inflation in the

middle east mobile markets, so it will be assumed as 81%.

Nationality: Egyptian or resident foreigner

Has Internet access, Internet penetration is around 29% in Cairo (MICT, 2011),

Population = 17.8 * 0.81 * 0.67 * 0.29 = 2.8 Million


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considered according the majority response i.e. answer was obtained more than 4 times. Answers

for the open ended questions were summarized, only the items that were mentioned by at least

half of the sample were listed in the summary.

II - Questionnaire

The software to be used for data analysis is SPSS V15, applying descriptive and inferential

analysis techniques, questions in the questionnaire are using a 5-point Likert-scale (1 = strongly

agree, 5 = strongly disagree) is used (Parasuraman, 1991),

Descriptive Analysis

Cronbachs alpha will be used for reliability tests within each variable

Also, some descriptive techniques will be used such as frequency tables, histograms and ranking

tables for mean values to describe the responses collected and the meaning of such

Inferential Analysis

Non-parametric tests will be used to test the model hypothesis and answer the research questions,such as Spearman rank association, hypothesis testing, based on the type of variables used in the

questionnaire (ordinal variables).

Spearman rank association was used to judge whether each variable constructs are

correlated.

Hypothesis testing will be used for variables that contains only one itemThe probability (sig.) will be compared to a 5% significance level.

Table 3.1: Data Requirement Table

Variable Type ariables Hypothesis Source Type Scale

INDEP X1 Performance Expectancy H1 Primary Quantitative Ordinal

INDEP X2 Trust H2 Primary Quantitative OrdinalINDEP X3 Cost H3 Primary Quantitative Ordinal

INDEP X4 Effort Expectancy H4 Primary Quantitative Ordinal

INDEP X5 Social influence H5 Primary Quantitative Ordinal


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4.CHAPTER 4: DATA ANALYSIS, FINDING AND

DISCUSSION

The first phase of data analysis was preliminary investigations to verify or enrich the proposed

model via semi-structured interview with subject matter experts

In the second phase the questionnaire was done to measure the customers intention to use

MVNO.

The survey was launched through the Internet with invitations via e-mails and social networking

channels starting from March 14th 2011 till April 4th 2011; the collected feedback was from 197

respondents; only three responses had invalid response.

4.1 EXPERTS INTERVIEW

SMEs defined the items to be measured under each construct of the UTAUT model, and

recommended that constructs: Extrinsic Motivation and Outcome Expectations are not relevant

to the thesis topic or the Egyptian market, and advised to replace the Relative Advantage

construct by three constructs: Services, Network specifics, Offers and proposed two new

variables: Cost and Trust.

For detailed expert interview feedback, refer to Appendix C: consolidated Experts interview

response Appendix C: consolidated Experts interview response

4.2DESCRIPTIVE ANALYSIS

4.2.1 Demographic data

More males (169) than females (25) have participated in the study (see Figure 4.1) Ages are

ranged along four groups: none of the respondents was below 20, 104 respondents belong to (20

to 35) group, 88 belong to (35 to 50) group and only 2 belong to (above 50) group (see


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Figure 4.1 - Descriptive Statistics for Gender


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Table 4.2 - Descriptive Statistics for Services construct

MeanTraffic information service 1.70Cheap voice calls over the Internet 1.72Broadband (Internet & Data) 1.78Bills payment 1.81Family offers 1.86Customer care 1.93

Advertisement SMS blocking 1.98

Roaming services 2.01Mobile Handsets 2.19Personal assistance service 2.22Personalized information service 2.24Events service 2.36

Valid N (listwise)

According to Table 4.1, the items that scored higher than in the Services construct are (in

descending order):

Traffic information service that tells me about crowded or closed roads

Cheap voice calls over the Internet (like Skype)

Broadband (Internet & Data)

Payment for bills from my mobile, example: Electricity, Water bills

Family offers (one package for all family lines with free family calls

Customer care solves my problems quickly with no hassle

Protection against unwanted advertisement SMS

2) The Perceived Usefulness construct:Table 4.3 - Descriptive Statistics for Perceived usefulness construct

Mean

I think that the MVNO services can be useful 1.98I believe that the MVNO services are useful enough to make me willing 2.30


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Figure 4.3 - Descriptive Statistics for Job fit construct

According to frequency chart in Figure 4.3; the majority of the respondents believe that the

MVNO services will fit/meet their lifestyle requirements so that they will be willing to use it.

4) The Offers construct:Table 4.4 - Descriptive Statistics for Offers construct

Mean

MVNO Offers me to gain points on its loyalty card every time I refill mymobile

1.79

MVNO gives bundled offers on their original brand products 1.92According to Table 4.4 the respondents; both types of offers affect the respondents intention to

use the MVNO services. But the offer to gain points on the respondents loyalty card has a

higher effect than that of the bundled offers on their original brand products.


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Figure 4.4 - Descriptive Statistics for PEOU construct

According to Figure 4.4, the respondents answers to whether or not they would use MVNO

new services even if they seem more difficult to use compared to traditional mobile services are

scattered. This indicates that this factor doesnt determine the respondents intention to use the

MVNO services alone if it actually affects the respondents intentions.

2) The Complexity construct:

Table 4.5 - Descriptive Statistics for Complexity constructMean

I would use MVNO if I can Subscribe or unsubscribe from MVNO services and offers insimple and easy steps

1.92

I would move my subscription to an MVNO if I can keep my current mobile number 1.97


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Table 4.6 - Descriptive Statistics for Network specifics construct

Mean

StatisticNetwork coverage 1.55High quality voice 1.63Call continuity (call never drops) 1.82Name of MNO behind the MVNO 2.28

Valid N (listwise)

According to Table 4.6 - Descriptive Statistics for Network specifics construct

Respondents agree more to these three items: Network coverage, Voice call quality and call

continuity rather than actual mobile operator that provides the network

It is interesting to note that for the item V22: I dont care about which network is behind the

MVNO, the mean was very close to the score 3 (Neutral), this means that users will not really

care which mobile operator is in the backend behind the MVNO brand

The Social Influence variable:1) The Image construct:

Table 4.7 - Descriptive Statistics for Social Influence construct

Mean

I would use MVNO if it seems to be an exclusive / VIP brand 2.53I would use MVNO if it seems to be an ordinary brand 3.02

According Table 4.7; the image doesnt play that much of a role in affecting the respondents

intention to use the MVNO services. This is clear from the mean of the answers which exceeds 2

in both cases indicating that the majority of the respondents didnt agree that they would use the

MVNO services due to its image whether it was exclusive or ordinary.2) The Social Factor construct:


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Figure 4.5 - Descriptive Statistics for Social factor construct

According to the frequency chart in Figure 4.5; the social factor (i.e. I would choose the MVNO

that my friends use) has no effect on the respondents intention to use the MVNO services.

The Trust variable:


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According to Figure 4.6, the majority of the respondents dont accept for the MVNO to

share/distribute their personal data to other parties.

The Cost variable:According to Figure 4.7, the majority of the respondents agree that the low cost of changing

from another network and join MVNO plays an important role in their intention to use the

MVNO services.

Figure 4.7 - Descriptive Statistics for Cost construct

The network Im using now isAccording to Error! Not a valid bookmark self-reference., The 194 respondents responded

that they have 242 mobile lines i.e. the mobile penetration is inflated due to the multi SIM


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User intention:According to figure Error! Reference source not found., majority of users show intention touse MVNO service

Figure 4.8 - Use Intention

4.3INFERENTIAL ANALYSIS

The following was assumed while doing the analysis:If r (correlation Coefficient) is 0.1 to 0.3 OR -0.1 to -0.3 then r = small correlation.

If r (correlation Coefficient) is 0.3 to 0.5 OR -0.3 to -0.5, then r = moderate correlation.

If r (correlation Coefficient) is 0.5 and above OR -0.5 and below then r = strong correlation.

The used significant value () is assumed to be 0.05

4.3.1 Reliability tests

Reliability tests were run on the level of the main variables (each main variable consists of several

questions belonging to different constructs) and on the overall data. The total number of


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0.7 > 0.5 Moderate reliability

Below 0.5 Low reliability

The results of the reliability analysis are as follows:

Table 4.10 - Reliability measurements

VariableNumber

Variable name Numberof items

Cronbach'sAlpha

Reliability

X1 Performance Expectancy 21 0.892 High reliability

X2 Effort Expectancy 4 0.613 Moderate reliability

X3 Social Influence 3 0.766 High reliability

X1, X2, X3,X4, X5

Overall reliability 30 0.904 Excellent reliability


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The X2 Effort Expectancy variable:

This variable consists of 4 different items categorized under 2 constructs:

Table 4.12 - Correlations of Effort Expectancy items

X4 - PEOU V28 V29 V30

Spearman's rho X4 - PEOU Correlation Coefficient 1.000 .118 .137 .238**

Sig. (2-tailed) . .101 .058 .001

N 194 194 194 194

V28 Correlation Coefficient .118 1.000 .488** .339**Sig. (2-tailed) .101 . .000 .000

N 194 194 194 194

V29 Correlation Coefficient .137 .488** 1.000 .378**

Sig. (2-tailed) .058 .000 . .000

N 194 194 194 194V30 Correlation Coefficient .238** .339** .378** 1.000

Sig. (2-tailed) .001 .000 .000 .

N 194 194 194 194

According to Table 4.12 - Correlations of Effort Expectancy items, the item X4 - PEOU :

Using the MVNO services even if they are more difficult than the regular service has no

statistically significant correlation with any of the other 3 items except with the item I would

use MVNO if it offers self-service channels like Web self service.

On the other hand the other three items has statistically significant correlation relationshipsbetween each other

Therefore it could be concluded that the variable Effort Expectancy has only 3 items out of 4

that affect the respondents intention to use the MVNO service.

The X3 Social Influence variable:

This variable consists of 3 different items categorized under 2 constructs:

Table 4.13 - Correlations of Social Influence items

V32 V33X5 - Socialfactor

S ' h V32 C l i C ffi i 1 000 009 174

A di h T bl 4 13 C l i f S i l I fl i h i I ld


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According to the Table 4.13 - Correlations of Social Influence items, the item I would use

MVNO if it seems to be an exclusive / VIP brand has no significant correlation with any of the

2 other factors.

Therefore it could be concluded that the variable Social Influence has only 2 factors that affect

the respondents intention to use the MVNO service.

The item V33 I would use MVNO if it seems to be an ordinary brand is highly significant with

the social factor construct with a medium correlation.

Translating this into business point of view, it can be inferred that an exclusive brand is not amust to succeed, this is good news for ordinary brands like supermarket chains, sport clubs, etc.

they should not worry too much about being excluded from the mobile market, majority of users

accepts to have an ordinary brand with a confirmed medium correlation with their friends

selection of MVNO they use what their friends or close social circle use.

This means that social networking should play a role in marketing and increasing the subscriberbase of an MVNO.

4.3.1Variable correlation analysis

Table 4.14 - Variable Correlarion - Spearman Rho

X1 PERF EXP X2 TRUST X3 COST X4 EFRT EXP X5 SOCL INF

Y - Intention Corr. Coef. .767(**) .120(*) -.277(**) .594(**) .298(**)

Sig. (1-tailed) .000 .048 .000 .000 .000

N 194 194 194 194 194

** Correlation is significant at the 0.01 level (1-tailed).* Correlation is significant at the 0.05 level (1-tailed).

According to Table 4.14 the followings is observed:

Performance Expectancy:

A statistically significant positive strong correlation is clearly pointed out between independent

variable X1: Performance Expectancy and dependent variable Y: Customer Intention: r (194) =

0.767, P


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A statistically significant positive strong correlation between independent variable X4: Effort

Expectancy and dependent variable Y: Customer Intention: r (194) = 0.594, P


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The analysis proved that all the model independent variables affect the user intention to use

MVNO. The factors ranking according to their correlation with the intention is as follows (in

descending order:

Performance expectancy

Effort expectancy

Social Influence

Cost

Trust

In a bit more detailed presentation, the factors that affect the respondents intention to use an

MVNO are listed as follows:

The Performance Expectancy:

Services: (only highest ranking items are listed)

Traffic information service that tells me about crowded or closed roads

Cheap voice calls over the Internet (like Skype)

Broadband (Internet & Data)

Payment for bills from my mobile, example: Electricity, Water bills

Family offers

Customer care solves my problems quickly with no hassle

Protection against unwanted advertisement SMS

Job fit:

MVNO services fits the customer lifestyle requirements

Network specific: (only highest ranking items are listed)

Voice calls are crystal clear, no noise, and no echo

Voice calls never drops

Network coverage is excellent inside buildings

The Social Influence:


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The Social Influence :

Image:

MVNO considered as an exclusive brand

Social Factor:

Customers may use the same operator that their friends use

The Cost: The incurred by the user in order to switch from current mobile service to MVNO.

The Trust: The user trust in the MVNO that his/her personal data are not leaked.

5 CHAPTER 5: CONCLUSION RECOMMENDATION AND


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5.CHAPTER 5: CONCLUSION, RECOMMENDATION AND

FUTURE WORK

An MNVO planning to establish business in Egypt should carefully consider its strategy and not

only concentrate on cost leadership but better follow a differentiation and provide a variety of

new services to its subscribers.

Despite of the fact that Egypt is a developing country and price is a dominant factor in customer

decision but it is not recommended for a new MVNO to use cost leadership strategy, accordingto recommendations of previous researches, the proper strategy for an MVNO is to differentiate

itself from MNOs by offer new and innovative services and to target niche or untapped market

segments (Kumar, 2010)

The finding of this research confirms the positive relationship between the proposed factors and

the user intention to use an MVNO; such factors are:

Innovative services: (Traffic information services, Bills payment, VOIP, Family offer

packs, advertisement SMS blocking)

Network/Voice quality

Offers (bundled with its original brand business)

Trust (specifically regarding personal data) Switching cost

Social influence

Complexity (or simplicity) of procedures required to subscribe to MVNO service

5.1 RECOMMENDATIONS

A new MVNO in Egypt is advised to:

Provide new and innovative services

Pro ide attracti e offers not necessaril straight price c ts b t more of b ndles ith its

Consider social groups while doing marketing as users tend to consider which MVNO


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s d s g ps w d g g s s s d s d w VN

that their friends or persons in their close circle are choosing

In some cases a mobile operator might have a good quality network but due to bad customer care

or weak marketing they do not have the first brand name in the market, this would be a perfect

partner fit between the MNO and MVNO in which the MVNO tries to do perfect marketing to

sell service in a high quality network.

5.2FUTURE WORK

A possible future work is to validate the Age, and Gender as moderating variables for this

model in Egypt, in addition to possibly new moderating variables, such study shall

consider a larger sample size to be able to statistically verify the outcome.

Study the effect of people awareness of innovative mobile services (in case it was

provided by classical service providers) the level of adoption of MVNO mobile service,

i.e. in case MVNO provides new services that was never provided by established MNO,

will it be accepted in the market?

Study the effect of social networking on marketing efficiency and growth potential of

MVNO

Study the MVNO acceptance from the brand extension prospective and the affect of the

original brand on the user intention to subscribe to the MVNO

Study the customer acceptance for MVNO as brand extension aspect and the effect of

the original brand on its new MVNO business

Another area that worth being explored is the MVNO effect on the original brand itself,

will it strengthen the original brand by being diversified or will it damage the original

brand due the competition with big mobile operators that in any case will stay bigger than

any MVNO scale


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APPENDIX A: SMES PROFILES


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APPENDIX A: SMES PROFILES

Hesham Moafi, Regulatory Affairs Officer, Orascom Telecom HoldingAshraf Sahab, Marketing Development Senior Manager, Orascom Telecom Holding

Mohammed El-Ammawi, Market Development & Strategy Director, Orascom Telecom Holding

Mostafa Khalil, Head of Revenue Management, Etisalat

Anonymous, Wholesale Department, Vodafone

Sherif Amin, Product and Services Director, EtisalatAhmed El-Noamani, Network Operation Senior Manager, Orascom Telecom Holding

Hesham Kamel, Solution Engineering Senior Manager, Orascom Telecom Holding

Amr El-Deeb, Project Senior manager, Orascom Telecom Holding

APPENDIX B: EXPERTS SEMI STRUCTURED


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APPENDIX B: EXPERTS SEMI- STRUCTURED

QUESTIONNAIRE

Hello,

Let me first give you a brief introduction about my thesis topic,

MVNO (Mobile Virtual Network Operator) is a new market approach in the Mobile business is

to have non telecom companies (like: Carrefour hyper market, Hilton hotels, Showtime satellite

network, Awlad Ragab supermarket, and RadioShack) selling mobile service using their own

brand, this approach is called Mobile Virtual Network Operator (MVNO);

This target of my thesis is to measure the consumer acceptance of a future MVNO, if an MVNO

is going to open up in Egypt

Part A:

Q1. First, if you are aware about the MVNO business model, please tell me your thoughts about

applying such approach in Egypt.

Answers:

Part B:

Q3. Ill mention some categories that are proposed by theories to affect the customer intention

to use something new like the MVNO; according to your knowledge about the Egyptian market,

please mention if they could be valid YES?NO?

And mention as well the items that might fit within each category?

YES NO


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Comments:

Job fit:

Extrinsic Motivation

YES NOComments:

Outcome ExpectationsYES NO

Comments:

Relative advantage:

YES NO

Comments:

Complexity

YES NO


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Subjective normYES NO

Comments:

Image

YES NO

Comments:

Social factors

YES NO

Comments:

Do you have other items to add that may influence the customer intention to subscribe to

MVNO?

Comments:

APPENDIX C: CONSOLIDATED EXPERTS INTERVIEW


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N C: CONSO S N V W

RESPONSEHello,

Let me first give you a brief introduction about my thesis topic,

MVNO (Mobile Virtual Network Operator) is a new market approach in the Mobile business is

to have non telecom companies (like: Carrefour hyper market, Hilton hotels, Showtime satellite

network, Awlad Ragab supermarket, and RadioShack) selling mobile service using their own

brand, this approach is called Mobile Virtual Network Operator (MVNO);

This target of my thesis is to measure the consumer acceptance of a future MVNO, if an MVNO

is going to open up in Egypt

Part A:

Q1. First, if you are aware about the MVNO business model, please tell me your thoughts about

apply

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