Internet Business Models

By Author: Yasmin Knight
Total Articles: 4
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The British mobile telephone market has been one with very little companies over the last few years. A few massive operators control most of the traffic, and top level mergers have further reduced the options for phone owners.

Recently, however, things are changing thanks to the arrival of operators such as GiffGaff who give Free Sim Cards for customers to use, assuming their handset isn't locked. GiffGaff is an award winning network, with a business model which could lead to big changes inside the phone market.

First of all, the community side is extremely fundamental. The website's forums are massive and extremely busy, these aid newcomers in getting the best offers and make the most of their phone.

Additionally there's the payback part, if you refer new customers and they sign up, you get a payback, either financially or in the form of a donation to a charity of your choice. This deal reinforces people's association with the company and makes them want to talk to more friends, like the snowball version of a phone company.

Another interesting part of the model is the web only setup, to limit overheads ...
... and send on benefits to members, GiffGaff only operates on the internet, and it saves other costs by piggybacking on O2s signal. This means that we enjoy the best elements of both companies, network access everywhere, and innovative offers that are generally tried out by members of the forums.

That said, GiffGaff is not the unique start up mobile phone company to piggyback on other networks signals, as one imagines, it's an extremely profitable model which can find significant savings for customers.

The difference is, though, that this particular enterprise is more successful than the other virtual networks because it's smarter at establishing links with the customers. In the era of social networking and non stop interaction with businesses, a whole business model constructed on customer interaction is more or less a certain success.

John Brown is a freelance technology journalist who specialises in mobile phone operators. He recommends GiffGaff for Free Sim Cards.