Chile’s telecom operator Nextel has revealed its intention to initiate a mobile virtual network operator (MVNO) service for pre-paid customers, claiming that the strategy would allow it to be more competitive in that segment, Telegeography.com writes, citing Diario Financiero. The provider has submitted an application to sector regulator Subtel, stressing that it also plans to continue functioning as a network operator.

Nextel Chile’s president, Estanislao Pena, explained that the cellco’s business model focuses on serving a niche of high-value customers. The current cost structure, aimed at ensuring high levels of service quality, spectrum capacity and post-sale service, is not profitable for the pre-paid market. If Subtel acquiesces to Nextel’s request, the cellco will split up its operations, offering pre-paid services as an MVNO whilst continuing to operate its own network to serve the contract segment.