Hawaiian MVNO Mobi Collapses: What Wireless Dealers Need to Know About MVNO Business Risks and Customer Protection

The wireless industry witnessed a dramatic MVNO failure in late November 2025 when Mobi, a Hawaiian mobile service provider with approximately 55,000 subscribers, abruptly ceased operations amid allegations of executive misconduct, unpaid wages, and abandoned customers. The collapse of Mobi—which had signed a multi-year agreement with T-Mobile just two years earlier and was implementing cutting-edge cloud-native infrastructure—serves as a stark reminder of the inherent risks in the MVNO business model and raises critical questions for wireless dealers about carrier stability, customer protection, and due diligence.

For wireless dealers who sell MVNO services or are considering adding MVNO brands to their portfolio, the Mobi collapse offers essential lessons about financial stability indicators, warning signs of operational distress, customer communication strategies during carrier failures, and risk mitigation practices that protect both your business and your customers.

Whether you currently sell established MVNOs like Metro by T-Mobile, Cricket Wireless, Boost Mobile, Visible, Mint Mobile, or smaller regional brands, understanding what happened to Mobi and why it matters is critical for making informed decisions about which carriers to represent and how to protect your customers from similar failures.

What Happened to Mobi: Timeline of a Collapse

Mobi's downfall was sudden and dramatic, leaving thousands of customers without service and sparking legal action that exposed serious allegations of mismanagement and potential fraud. Here's the timeline of events based on court filings, customer reports, and industry sources.

The Promising Beginning: 2005-2023

Mobi was established in 2005 as a mobile service provider focused on the Hawaiian market. For nearly two decades, the company operated as an MVNO, leasing network capacity from major carriers rather than building its own infrastructure. This business model is common in the wireless industry and allows smaller operators to compete without the massive capital investment required for network construction and maintenance.

In 2023, Mobi signed a multi-year MVNO agreement with T-Mobile, gaining access to T-

Mobile's nationwide 5G network. This was seen as a positive development that would allow Mobi to offer competitive coverage and speeds while maintaining its local Hawaiian identity and customer service approach. At the time, CEO Justen Burdette positioned the T-Mobile partnership as a strategic move that would enable Mobi to scale and compete more effectively.

The Innovation Phase: 2024

Throughout 2024, Mobi pursued an ambitious technology modernization strategy, working to establish a cloud-native mobile core supported by Amazon Web Services (AWS) and partnering with Working Group Two (WG2), a company that had taken a different approach to mobile core architecture by eschewing traditional 3GPP internal interfaces and replacing them with cloud-native messaging techniques.

Industry analyst Roy Chua of AvidThink, who served as a beta user of Mobi's service during this period, reported positive experiences across both iOS and Android devices from fall 2024 until the collapse. "I had previously tested the service in different cities around the U.S. during my travels to conferences and client visits, and it worked robustly," Chua told Fierce Network. He described himself as "excited by Mobi's bold moves in 2024" and saw the company as an innovative player in the MVNO space.

From the outside, Mobi appeared to be heading in the right direction—modern infrastructure, strong network partner, innovative technology approach, and approximately 55,000 subscribers generating recurring revenue. Industry observers had no reason to suspect the company was in distress.

The Hidden Crisis: Late 2024

According to CEO Justen Burdette's later statements, trouble began in late 2024, though the specific nature of the problems was not publicly disclosed at the time. Burdette indicated that the issues revolved around "a dispute over control of the company" rather than technical or network problems. This internal conflict apparently escalated throughout the fall of 2024 while the company continued operating normally from a customer perspective.

The Turning Point: Early October 2025

The situation reached a critical turning point in early October 2025 with the departure of two unnamed executives. While the circumstances of these departures are not fully clear from public records, Burdette later characterized this moment as pivotal in the company's downfall. The loss of key leadership during an already-strained period appears to have triggered a cascade of operational and financial problems that ultimately proved insurmountable.

The Collapse: Late November 2025

In late November 2025, Mobi customers began reporting widespread service disruptions. Phone service became intermittent or stopped working entirely. Text messages and calls to customer service went unanswered. The company's email address (help@mobi.com) became undeliverable. Customers took to Reddit and other online forums seeking help and information, but received no response from the company.

Many customers discovered they couldn't port their phone numbers to other carriers because they couldn't access the account information required for the porting process. Some were forced to get entirely new phone numbers and devices, losing their contacts and existing numbers in the process—a particularly devastating outcome during the holiday season when communication with family and friends is especially important.

The Lawsuit: November 24, 2025

On November 24, 2025, shareholders JB Mobile Holding and Pierre-Emmanuel Durand filed a lawsuit in Delaware Court of Chancery through the law firm Skadden, Arps, Slate, Meagher & Flom. The complaint made serious allegations against CEO Justen Burdette, including that he had fled to Brazil, locked employees out of company systems, neglected to fulfill a multimillion-dollar purchase agreement, failed to pay \$1 million in wages, and terminated key executives without authorization.

The lawsuit painted a picture of deliberate abandonment and potential fraud, with the CEO allegedly absconding to another country while leaving employees unpaid and customers stranded without service or support.

The Response: December 1, 2025

On December 1, 2025, Burdette disputed the allegations in an interview with Fierce Network. He acknowledged that the narrative about fleeing to Brazil was false, noting sarcastically that "the narrative would have been closer to the truth if it had said he fled to Canada, where he previously lived, but that might not be as dramatic as Brazil." Burdette stated he was at his home base in Honolulu, "tying up loose ends and helping Mobi's remaining customers port their phone numbers to other carriers."

Burdette characterized the collapse as resulting from internal disputes over company control rather than operational or technical failures. "It is very sad and heartbreaking what so many folks worked so many years at Mobi to build," he said. "We got very close to being able to prove that all out… If I knew what to have done and could go back in time, I would certainly do whatever I could to try to change that."

As of early December 2025, Mobi's service remains offline, customers are still attempting to port their numbers to other carriers, and the legal dispute continues. The company's future appears bleak, with no indication of service restoration or business continuation.

Understanding MVNO Business Model Risks

The Mobi collapse highlights fundamental vulnerabilities in the MVNO business model that wireless dealers must understand when evaluating which carriers to represent and recommend to customers.

Thin Profit Margins and Financial Fragility

MVNOs operate on notoriously thin profit margins. Unlike facilities-based carriers (AT&T, Verizon, T-Mobile) that own their network infrastructure and can spread costs across millions of subscribers, MVNOs must pay wholesale rates to lease network capacity from these larger carriers. This creates a challenging economic equation where MVNOs must price competitively to attract customers while maintaining sufficient margin to cover their wholesale costs, operational expenses, customer service, marketing, and administrative overhead.

For smaller MVNOs like Mobi with approximately 55,000 subscribers, achieving economies of scale is difficult. Every customer service interaction, every marketing campaign, and every technology investment must be spread across a relatively small subscriber base. This makes MVNOs particularly vulnerable to unexpected costs, subscriber churn, or disruptions in their wholesale agreements with network providers.

When financial stress occurs—whether from declining subscriber numbers, increased wholesale costs, competitive pressure, or management disputes—MVNOs have limited options for weathering the storm. Unlike facilities-based carriers with substantial assets and access to capital markets, smaller MVNOs may find themselves unable to secure emergency financing or restructure their operations to survive temporary difficulties.

Dependence on Wholesale Network Agreements

MVNOs exist entirely at the discretion of their wholesale network partners. While Mobi had signed a "multi-year agreement" with T-Mobile in 2023, the specific terms of such agreements typically include performance requirements, payment obligations, and termination clauses that can create existential risks for the MVNO if not carefully managed.

If an MVNO fails to meet its minimum purchase commitments, falls behind on payments, or violates other terms of the wholesale agreement, the network provider can restrict or terminate service. This creates a potential death spiral: financial difficulties lead to payment problems, which lead to service restrictions, which lead to customer churn, which worsens financial difficulties.

In Mobi's case, it's unclear whether the T-Mobile wholesale agreement played a role in the collapse, but the company's sudden service disruptions suggest that network access may have been restricted or terminated, either due to non-payment or other contractual issues.

Limited Capital for Technology Investment

Mobi's ambitious cloud-native mobile core initiative with AWS and Working Group Two represented exactly the kind of technology investment that MVNOs need to differentiate themselves and operate efficiently. However, such investments require significant capital and technical expertise—resources that are often scarce for smaller MVNOs.

When MVNOs invest heavily in technology modernization, they're betting that the operational efficiencies and customer experience improvements will generate sufficient return on investment to justify the costs. If subscriber growth doesn't materialize as projected, or if the technology implementation encounters unexpected challenges or delays, the MVNO may find itself overextended financially with limited ability to course-correct.

This creates a difficult strategic dilemma: MVNOs that don't invest in modern technology risk becoming uncompetitive, but MVNOs that invest too aggressively in technology risk financial instability if the investments don't pay off quickly enough.

Governance and Management Challenges

Burdette's statement that Mobi's collapse stemmed from "a dispute over control of the company" points to another common MVNO vulnerability: governance and management challenges. Smaller telecommunications companies often have complex ownership structures involving multiple investors, founders, and stakeholders with different visions for the company's direction, growth strategy, and financial management.

When these stakeholders disagree about fundamental business decisions—whether to pursue aggressive growth or focus on profitability, how much to invest in technology, which markets to target, how to respond to competitive threats—the resulting conflicts can paralyze decision-making and create operational chaos. The departure of two unnamed executives in early October 2025 suggests that Mobi's internal conflicts reached a point where key leaders chose to leave rather than continue navigating the dysfunction.

For MVNOs without strong governance structures, clear decision-making authority, and aligned stakeholder interests, these internal conflicts can quickly escalate from strategic disagreements to existential crises.

Customer Service and Support Overhead

One of the most challenging aspects of the MVNO business model is providing adequate customer service and technical support with limited resources. Customers expect responsive support when they have billing questions, technical issues, or need help with their service—but providing this support requires staffing, training, systems, and processes that create significant fixed costs for the MVNO.

When Mobi's service began failing in late November 2025, customers reported that their texts and calls to customer service went unanswered and the company's email address became undeliverable. This suggests that customer service operations had been shut down or severely curtailed, leaving customers with no way to get help or information about what was happening.

The inability to provide even basic customer communication during a crisis reflects the financial and operational stress the company was experiencing. For dealers, this is a critical warning sign: when an MVNO can't or won't communicate with customers during service disruptions, the company is likely in severe distress.

Warning Signs Dealers Should Watch For

The Mobi collapse offers important lessons about warning signs that wireless dealers should monitor when working with MVNOs. While no single indicator guarantees an MVNO is in trouble, multiple warning signs appearing together should prompt serious evaluation of whether to continue representing the brand.

Deteriorating Customer Service Responsiveness

One of the earliest and most visible warning signs is declining customer service quality. If customers report longer wait times, unanswered inquiries, unresolved technical issues, or difficulty reaching support, this often indicates the MVNO is cutting costs by reducing customer service staffing or is experiencing operational chaos that prevents effective support delivery.

As a dealer, you should regularly test the customer service experience yourself—call or message support with questions, monitor response times, and evaluate the quality of assistance provided. If you notice significant deterioration in service quality or responsiveness, investigate whether this reflects temporary staffing issues or deeper financial problems.

Payment Processing Problems

MVNOs experiencing financial distress often have problems processing dealer commissions, customer payments, or vendor invoices. If you notice delays in commission payments, inconsistent payment timing, or requests to defer payments, these are serious red flags that the MVNO may be experiencing cash flow problems.

Similarly, if customers report problems with automatic payment processing, difficulty making manual payments, or unexpected service suspensions despite having paid their bills, these issues may indicate that the MVNO's billing systems are malfunctioning or that the company is having trouble managing its accounts receivable and payable.

Executive Turnover and Departures

The departure of two unnamed executives in early October 2025 proved to be a turning point for Mobi. High-level executive departures—especially when multiple executives leave within a short timeframe—often signal serious internal problems such as strategic disagreements, financial distress, governance conflicts, or ethical concerns.

Dealers should pay attention to leadership changes at the MVNOs they represent. While some turnover is normal, sudden departures of multiple senior executives, especially without clear succession plans or explanations, warrant concern and investigation.

Communication Gaps and Lack of Transparency

Healthy MVNOs maintain regular communication with their dealer partners about new products, promotions, policy changes, and business updates. When this communication becomes sporadic, vague, or stops entirely, it may indicate operational problems or management dysfunction.

Mobi's complete communication blackout in late November—with unanswered customer service inquiries, undeliverable emails, and no public statements about the service disruptions—represented an extreme example of communication failure that signaled the company's collapse. Dealers should be concerned well before communication reaches this crisis point, watching for patterns of delayed responses, cancelled meetings, or evasive answers to direct questions about business performance.

Service Quality Degradation

Technical problems, network outages, or service quality issues that persist without resolution or explanation can indicate that the MVNO is having problems with its wholesale network provider, lacks the technical resources to address issues, or is experiencing operational chaos.

Analyst Roy Chua noted that Mobi's service "had worked well since the fall of 2024 until recently," suggesting that the service degradation was sudden rather than gradual. However, dealers should watch for patterns of unresolved technical issues, increasing customer complaints about service quality, or unexplained outages that may signal deeper problems.

Marketing and Promotional Activity Changes

MVNOs in financial distress often reduce or eliminate marketing and promotional spending to conserve cash. If you notice that an MVNO has stopped running promotions, reduced advertising, or cut back on dealer incentives and spiffs, this may indicate financial constraints.

Conversely, sometimes struggling MVNOs launch aggressive promotions with unsustainably low pricing or generous incentives in a desperate attempt to acquire subscribers and generate cash flow. These "too good to be true" offers may indicate that the MVNO is prioritizing short-term survival over long-term sustainability.

Regulatory or Legal Issues

The lawsuit filed against Mobi on November 24, 2025, alleged serious misconduct including unpaid wages, unauthorized executive terminations, and breach of purchase agreements.

While dealers may not be aware of internal legal disputes until they become public, any news of regulatory investigations, lawsuits, unpaid vendor claims, or compliance violations should prompt immediate scrutiny of the MVNO's stability and your continued relationship with the brand.

Monitor industry news sources, court filings, and regulatory databases for any legal or regulatory actions involving the MVNOs you represent. Even if the specific allegations don't directly affect your dealer operations, they often signal broader organizational dysfunction or financial distress.

Changes to Dealer Agreements or Compensation

If an MVNO suddenly changes dealer commission structures, extends payment terms, adds new restrictions to compensation, or modifies dealer agreements in ways that reduce your earnings or increase your obligations, these changes may reflect financial pressure or strategic shifts that indicate instability.

While some changes to dealer programs are normal business adjustments, sudden or unexplained changes—especially those that are financially unfavorable to dealers—should prompt questions about the MVNO's financial health and long-term viability.

How Mobi's Collapse Affected Customers: Lessons in Customer Protection

The human cost of Mobi's collapse was significant, with approximately 55,000 customers suddenly losing service, often without warning or explanation. Understanding what customers experienced provides critical lessons for dealers about customer protection and crisis management.

Service Disruptions Without Warning or Communication

Mobi customers reported that their service became intermittent or stopped working entirely in late November 2025 with no advance notice or explanation. Customers who depend on their mobile service for work, family communication, emergency access, and daily activities suddenly found themselves unable to make calls, send texts, or access data.

The lack of communication from Mobi about the service disruptions left customers confused, frustrated, and unable to plan alternative solutions. Many customers wasted time troubleshooting their devices, thinking the problem was with their phone or SIM card rather than a carrier-wide failure.

Dealer Lesson: When you become aware of service problems affecting an MVNO you represent, proactively communicate with your customers even if the carrier hasn't provided official guidance. Let customers know you're aware of the issue, investigating the cause, and will provide updates as information becomes available. Your proactive communication builds trust and helps customers make informed decisions about whether to wait for resolution or switch carriers.

Inability to Port Phone Numbers

One of the most damaging aspects of Mobi's collapse was that customers couldn't access the account information required to port their phone numbers to other carriers. Number porting requires specific account details including account number, PIN, and sometimes billing information—all of which were inaccessible when Mobi's systems went offline and customer service became unreachable.

Some customers were forced to get entirely new phone numbers, losing the number they'd had for years and having to notify all their contacts, update accounts and services linked to their old number, and deal with the disruption of losing their established phone identity.

Dealer Lesson: Advise customers to document their account information—account number, PIN, billing details—and store it securely outside of the carrier's systems. This information enables quick porting if the carrier experiences problems. Consider providing customers with a checklist of information to document when they activate service, positioning this as a best practice for account security and portability rather than suggesting you expect carrier problems.

Financial Losses and Holiday Timing

Many Mobi customers had prepaid for service that they never received, representing direct financial losses. Additionally, some customers had to purchase new devices or SIM cards to switch to other carriers, incurring unexpected expenses during the holiday season when budgets are already stretched.

One customer who contacted Fierce Network stated: "He's wiped out every single system to contact the company. What a horrible thing to do! Especially around the holidays when money is already tight." This highlights the financial and emotional impact of carrier failures on customers who are already managing tight budgets and seasonal expenses.

Dealer Lesson: When selling MVNO services, be transparent about the risks of prepaid service and consider recommending shorter prepayment periods (monthly rather than quarterly or annual) for MVNOs with less established track records. While longer prepayment periods often come with discounts, they also increase customer financial exposure if the carrier fails. Help customers balance cost savings against risk exposure based on their financial situation and risk tolerance.

Loss of Contacts and Data

Customers who couldn't port their numbers and had to get new devices sometimes lost their contacts, photos, messages, and other data stored on their phones or associated with their phone numbers. While cloud backup services can mitigate this risk, not all customers use these services consistently, and some data (like SMS message history) may not be backed up automatically.

Dealer Lesson: As part of your customer onboarding process, help customers set up cloud backup services (iCloud for iOS, Google Drive for Android) and verify that contacts, photos, and other important data are being backed up regularly. Position this as a best practice for device protection (in case of loss, theft, or damage) rather than carrier failure, but emphasize that it also protects them if they need to switch carriers quickly.

Difficulty Getting Help or Information

Perhaps the most frustrating aspect for Mobi customers was the complete inability to get help, information, or answers about what was happening. Customer service was unreachable, emails bounced, and the company provided no public statements or updates. Customers turned to Reddit and other online forums seeking information from each other because the carrier provided none.

Dealer Lesson: Position yourself as a trusted advisor and information source for your customers, not just a sales channel. Provide customers with your direct contact information and encourage them to reach out if they experience problems or have questions. When carrier issues arise, be the source of accurate information and guidance that helps customers navigate the situation, even if it means recommending they switch to a different carrier you represent.

What Dealers Should Do When an MVNO Fails

If an MVNO you represent experiences a collapse similar to Mobi's, you need a crisis response plan that protects your customers, preserves your reputation, and manages your business exposure. Here's a step-by-step action plan.

Step 1: Assess the Situation and Gather Information

As soon as you become aware of service disruptions, payment problems, or other indicators of MVNO distress, immediately begin gathering information from multiple sources including the MVNO's official communications (if any), industry news sources, customer reports, other dealers, and your own testing of the service and customer support.

Document everything you learn, including dates, times, sources, and specific details about service problems, communication failures, or other issues. This documentation may be important for resolving customer disputes, filing claims, or protecting yourself from liability.

Step 2: Communicate Proactively with Your Customers

Don't wait for the MVNO to communicate with customers—they may never do so, as Mobi's case demonstrates. Reach out proactively to customers you've activated on the affected MVNO with honest, transparent information about what you know, what you don't know, and what you're doing to help.

Your communication should acknowledge the problem, express empathy for the inconvenience and concern customers are experiencing, provide factual information about the situation without speculation or blame, outline options available to customers, and commit to ongoing updates as you learn more.

Example message: "I'm reaching out because you're currently a customer of [MVNO], and I want to make sure you have accurate information about the service disruptions that began [date]. Here's what I know so far: [factual summary]. I understand this is frustrating and concerning, especially if you're experiencing service problems. I'm actively monitoring the situation and working to get more information. In the meantime, here are your options: [list alternatives]. I'm here to help you through this situation, whether that means waiting for [MVNO] to resolve the issues or helping you transition to a different carrier. Please don't hesitate to contact me with questions or concerns."

Step 3: Help Customers Port to Alternative Carriers

If the MVNO's collapse appears irreversible, prioritize helping your customers port their numbers to alternative carriers before the situation worsens and porting becomes impossible (as happened with Mobi customers who couldn't access their account information).

Identify the account information customers need for porting (account number, PIN, billing details) and help them retrieve this information while the MVNO's systems are still accessible. If systems are already offline, work with customers to explore alternative porting methods or, as a last resort, help them transition to new numbers with minimal disruption.

Recommend alternative carriers based on each customer's needs, budget, and usage patterns—not just which carrier offers you the highest commission. Your integrity during this crisis will determine whether customers trust you going forward and refer others to your business.

Step 4: Document Customer Interactions and Resolutions

Keep detailed records of every customer interaction related to the MVNO failure, including what information you provided, what actions you took to help, what alternatives you recommended, and what the customer decided to do. This documentation protects you if customers later claim you provided inaccurate information, failed to help, or acted inappropriately during the crisis.

Also document any financial exposure you have—unpaid commissions, chargebacks, customer refund requests, or other costs resulting from the MVNO's failure. You may need this documentation to file claims, seek recovery, or demonstrate business losses for tax purposes.

Step 5: Evaluate Your Relationship with the MVNO

Once the immediate customer crisis is managed, assess whether to continue representing the MVNO (if it survives) or permanently end the relationship. Consider factors including the MVNO's explanation for what happened and steps taken to prevent recurrence, financial stability and long-term viability, quality of communication during the crisis, treatment of dealers and customers, and your confidence in the company's leadership and governance.

In most cases where an MVNO experiences a collapse as severe as Mobi's, the relationship is over—either because the company ceases operations entirely or because the damage to trust and reputation is irreparable. However, if the MVNO survives and you're considering continuing the relationship, require concrete evidence of financial stability, operational improvements, and governance reforms before activating new customers.

Step 6: Learn and Adjust Your Carrier Selection Criteria

Use the experience to refine your criteria for evaluating which MVNOs to represent. Develop a more rigorous due diligence process that assesses financial stability, ownership structure and governance, wholesale network agreements, customer service capabilities, technology infrastructure, management team experience and track record, and market position and competitive differentiation.

Consider whether to focus more heavily on established MVNOs with proven track records (Metro by T-Mobile, Cricket Wireless, Boost Mobile, Visible) rather than smaller, newer brands with higher risk profiles. While smaller MVNOs may offer higher commissions or more attractive dealer terms, the risk of collapse and the resulting customer service burden may not justify the potential rewards.

Step 7: Communicate Lessons Learned to Your Team

If you have employees or other dealers working with you, conduct a debrief session to review what happened, how you responded, what worked well, what could have been handled better, and what processes or policies you're implementing to better manage similar situations in the future.

This turns a negative experience into a learning opportunity that strengthens your organization's crisis response capabilities and prepares your team to handle future challenges more effectively.

Due Diligence: Evaluating MVNO Stability Before Signing Dealer Agreements

The best way to protect yourself and your customers from MVNO failures is to conduct thorough due diligence before agreeing to represent a brand. Here's what to investigate and evaluate.

Financial Stability and Funding

Request information about the MVNO's financial position, including subscriber count and growth trends, revenue and profitability, funding sources and investor backing, cash reserves and runway, and debt obligations. While privately-held MVNOs may not disclose detailed financial information, you should at minimum understand whether the company is profitable, how it's funded, and whether it has sufficient capital to sustain operations through temporary challenges.

Be especially cautious with MVNOs that are burning through venture capital funding without a clear path to profitability, or that have high debt levels relative to their revenue and subscriber base.

Wholesale Network Agreement Terms

Understand the MVNO's relationship with its wholesale network provider, including which network the MVNO uses (T-Mobile, AT&T, Verizon), length and terms of the wholesale agreement, minimum purchase commitments and whether they're being met, and network priority and data speeds provided to MVNO customers.

MVNOs with long-term wholesale agreements, reasonable minimum commitments, and good relationships with their network providers are generally more stable than those with short-term agreements, aggressive commitments, or contentious provider relationships.

Management Team and Governance

Research the MVNO's leadership team and ownership structure, including CEO and executive team backgrounds and experience, ownership structure and investor composition, board of directors composition and governance practices, and track record of previous ventures and exits.

Look for experienced telecommunications executives with successful track records, stable ownership structures with aligned investor interests, and strong governance practices that ensure accountability and sound decision-making. Be cautious with first-time entrepreneurs, complex ownership structures with competing interests, or management teams with histories of failed ventures or ethical issues.

Customer Service Infrastructure

Evaluate the MVNO's customer service capabilities by testing response times and service quality yourself, reviewing customer complaints and satisfaction ratings on social media and review sites, understanding staffing levels and support hours, and assessing technical support capabilities for device and network issues.

MVNOs with responsive, knowledgeable customer service teams and adequate staffing are better positioned to retain customers and weather operational challenges than those with poor service infrastructure.

Technology Platform and Infrastructure

Understand the MVNO's technology stack, including billing and customer management systems, network core infrastructure (traditional vs. cloud-native), device compatibility and activation processes, and technology partners and vendors.

While Mobi's cloud-native initiative with AWS and Working Group Two represented innovative technology, it also represented significant investment and execution risk. Evaluate whether the MVNO's technology choices are appropriate for its scale, resources, and market position, or whether they represent overreach that could create financial or operational problems.

Market Position and Competitive Differentiation

Assess whether the MVNO has a sustainable competitive position, including clear target market and customer value proposition, pricing strategy and profitability per customer, brand recognition and marketing effectiveness, and differentiation from competitors.

MVNOs that compete primarily on price without other differentiation often struggle to achieve profitability and sustainability. Look for MVNOs with clear value propositions beyond just low prices—such as superior customer service, specialized features, community focus, or unique partnerships.

Dealer Support and Communication

Evaluate how the MVNO treats and supports its dealer partners, including commission structure and payment reliability, training and sales support provided, marketing materials and co-op advertising, and responsiveness to dealer questions and concerns.

MVNOs that invest in dealer relationships, provide strong support, and communicate regularly are generally more stable and dealer-friendly than those that treat dealers as disposable sales channels.

The Broader MVNO Landscape: Which Brands Are Safe?

Not all MVNOs carry the same risk profile. Understanding the different tiers of MVNO stability can help dealers make informed decisions about which brands to represent.

Tier 1: Carrier-Owned MVNOs (Lowest Risk)

MVNOs owned by major carriers—Metro by T-Mobile, Cricket Wireless (AT&T), Visible (Verizon), and Total by Verizon—represent the lowest risk category. These brands are backed by their parent carriers' financial resources, infrastructure, and operational expertise. While they can still experience service issues or policy changes, they're extremely unlikely to collapse suddenly or leave customers stranded.

Dealer Recommendation: These brands should form the core of your MVNO portfolio, especially for customers who prioritize reliability and stability over the absolute lowest prices.

Tier 2: Well-Established Independent MVNOs (Low to Moderate Risk)

Long-running independent MVNOs with substantial subscriber bases, proven profitability, and strong management teams—such as Mint Mobile (now T-Mobile owned), US Mobile, Consumer Cellular, and TracFone brands—represent low to moderate risk. These companies have demonstrated the ability to navigate competitive challenges, maintain wholesale network relationships, and sustain operations over many years.

Dealer Recommendation: These brands are generally safe to represent, but dealers should monitor their financial performance, management stability, and customer satisfaction trends to ensure they remain healthy.

Tier 3: Newer or Smaller Independent MVNOs (Moderate to High Risk)

Smaller MVNOs with limited subscriber bases, shorter operating histories, or less proven management teams—such as regional brands, ethnic-focused carriers, or recently launched services—carry moderate to high risk. These companies may offer innovative features, attractive dealer commissions, or serve underserved market segments, but they also face greater challenges achieving scale, profitability, and long-term sustainability.

Mobi fell into this category—approximately 55,000 subscribers, regional focus, ambitious technology initiatives, but ultimately vulnerable to internal conflicts and financial pressures that larger, more established MVNOs could have weathered.

Dealer Recommendation: Approach these brands cautiously. Conduct thorough due diligence before signing dealer agreements, monitor warning signs closely, limit your customer concentration on any single smaller MVNO, and be prepared to help customers migrate quickly if problems emerge. Consider these brands as portfolio diversification rather than core offerings, and ensure customers understand the risk-reward tradeoff of choosing smaller carriers.

Tier 4: Startup MVNOs and Unproven Brands (High Risk)

Brand-new MVNOs with minimal operating history, unproven business models, first-time management teams, or unclear funding sources represent the highest risk category. While some of these companies may succeed and become established players, many will fail within their first few years of operation.

Dealer Recommendation: Exercise extreme caution with startup MVNOs. Only represent these brands if you've conducted extensive due diligence, have confidence in the management team and business model, can afford to lose any unpaid commissions, and are prepared to migrate customers quickly if the venture fails. Never concentrate a significant portion of your customer base on unproven brands.

Legal and Regulatory Considerations

The Mobi collapse raises important legal and regulatory questions that may affect how dealers and MVNOs operate going forward.

FCC Oversight and Consumer Protection

Fierce Network reached out to the Federal Communications Commission (FCC) to ask whether the agency is advising Mobi customers or considering enforcement action. As of early December 2025, no public FCC response has been reported, but the situation highlights questions about regulatory oversight of MVNO failures and consumer protection.

Unlike facilities-based carriers that are heavily regulated by the FCC and state public utility commissions, MVNOs operate in a less regulated environment with fewer consumer protection requirements. This regulatory gap means that when MVNOs fail, customers may have limited recourse for recovering prepaid service fees, porting their numbers, or obtaining compensation for damages.

Dealers should watch for potential regulatory responses to the Mobi collapse, including possible new FCC rules requiring MVNOs to maintain customer service continuity during business transitions, provide advance notice of service terminations, facilitate number porting even during operational failures, or maintain financial reserves to protect prepaid customer funds.

Dealer Liability and Customer Claims

When an MVNO fails, dealers may face customer claims for refunds, damages, or compensation, especially if customers paid the dealer directly for service or devices. While dealers typically act as agents of the carrier rather than principals in the customer relationship, the legal boundaries can be unclear, particularly if dealer agreements or customer communications suggest the dealer has responsibility for service delivery.

To protect yourself from liability when representing MVNOs, ensure your dealer agreements clearly establish that you're an independent agent, not an employee or representative of the carrier; clearly communicate to customers that service is provided by the MVNO, not by your dealership; avoid making guarantees or warranties about service quality or carrier stability that exceed what the MVNO itself promises; document all customer interactions and maintain clear records of what you told customers and what actions you took; and consider business liability insurance that covers customer claims related to carrier failures.

Unpaid Commissions and Dealer Recovery

The Mobi lawsuit alleges that CEO Burdette "failed to pay \$1 million in wages," suggesting that employees weren't the only parties left unpaid when the company collapsed. Dealers with outstanding commission payments from failed MVNOs often have limited options for recovery, especially if the MVNO has no remaining assets or has filed for bankruptcy protection.

To minimize your exposure to unpaid commissions, negotiate shorter commission payment cycles (weekly or bi-weekly rather than monthly), require personal guarantees from MVNO principals for commission payments if possible, monitor payment timing and consistency as an early warning sign of financial distress, and consider reducing or stopping new activations if commission payments become delayed or irregular.

If an MVNO fails owing you commissions, consult with an attorney about your options for filing claims in bankruptcy proceedings, pursuing collection actions, or joining class action lawsuits with other creditors. However, recognize that unsecured creditors (which dealers typically are) often recover little or nothing when companies collapse.

Customer Communication Scripts for MVNO Failures

Dealers need prepared communication strategies for discussing MVNO stability concerns with customers and managing customer relationships during carrier failures. Here are practical scripts for common scenarios.

Proactive Communication When Service Problems Begin

Scenario: You've learned that an MVNO you represent is experiencing service disruptions or other problems, and you need to reach out to customers proactively.

Script: "Hi [Customer Name], this is [Your Name] from [Your Dealership]. I'm reaching out because I want to make sure you have accurate information about some service issues affecting [MVNO] customers. Starting around [date], some customers have reported [specific problems: service disruptions, customer service delays, etc.]. I want you to know that I'm monitoring the situation closely and staying in touch with [MVNO] to get updates. If you're experiencing any problems with your service, please contact me directly at [your contact info] and I'll help you troubleshoot or explore alternatives if needed. I'm committed to making sure you have reliable service, and I'll keep you updated as I learn more about what's happening and when it will be resolved. Do you have any questions or concerns I can address right now?"

Helping Customers Decide Whether to Wait or Switch

Scenario: A customer asks whether they should wait for the MVNO to fix problems or switch to a different carrier immediately.

Script: "That's a great question, and the right answer depends on your specific situation and priorities. Here's what I can tell you: [factual summary of what you know about the MVNO's situation and timeline for resolution, if any]. If you depend heavily on your phone service for work, family communication, or emergencies, and you're currently experiencing service problems, I'd recommend switching to a more reliable carrier sooner rather than later. I can help you port your number to [alternative carrier options] and get you back up and running quickly. If your service is currently working and you're comfortable waiting to see if [MVNO] resolves the issues, that's also a reasonable choice, but I'd recommend documenting your account information now—account number, PIN, billing details—so you can port quickly if needed. Either way, I'm here to help you make the decision that's right for your needs and to support you through whichever option you choose."

Addressing Customer Anger and Frustration

Scenario: A customer is angry about service problems, financial losses, or feeling misled about the MVNO's reliability.

Script: "I completely understand your frustration, and I'm genuinely sorry you're dealing with this situation. You trusted me when I recommended [MVNO], and I take that responsibility seriously. I want you to know that I had no advance warning this would happen—[MVNO] appeared to be operating normally until [when problems began]. That said, I recognize that doesn't change the inconvenience and problems you're experiencing now. Here's what I can do to help: [specific actions you'll take, such as helping port their number, recommending alternative carriers, assisting with any refund claims, etc.]. My priority is making sure you have reliable service going forward and that we resolve this situation as fairly as possible. What would be most helpful to you right now?"

Explaining Why You Recommended the Failed MVNO

Scenario: A customer questions your judgment in recommending an MVNO that failed, and you need to explain your decision-making process while maintaining credibility.

Script: "That's a fair question. When I recommended [MVNO], they had [positive factors: X thousand subscribers, multi-year agreement with major network, X years of operating history, positive customer reviews, etc.]. Based on the information available at the time, they appeared to be a stable, reliable option that offered good value for customers with your usage patterns and budget. Unfortunately, what we've learned since then is that they were experiencing internal problems—[brief factual summary of what caused the failure]—that weren't visible from the outside. I've learned from this experience and I'm implementing more rigorous evaluation processes for the carriers I recommend going forward. What I can promise you is that I'll always be honest with you about what I know and don't know, and I'll prioritize your long-term satisfaction over short-term sales. Let's focus on finding you a carrier that meets your needs with the stability and reliability you deserve."

Recommending Alternative Carriers After MVNO Failure

Scenario: A customer needs to switch from the failed MVNO and is asking for recommendations, but is now skeptical about MVNOs in general.

Script: "I understand why you'd be hesitant about MVNOs after this experience. Here's what I'd recommend based on your priorities: If stability and reliability are your top concerns and you want the lowest possible risk, I'd suggest [carrier-owned MVNO like Metro by T-Mobile, Cricket Wireless, or Visible]. These are owned by the major carriers, so they have the financial backing and infrastructure stability of their parent companies. You'll pay slightly more than you were paying with [failed MVNO], but you'll have much greater confidence that the service will be there when you need it. If you want to stay in the value MVNO space but with a more established brand, [well-established independent MVNO like US Mobile or Consumer Cellular] has been operating successfully for [X years] with [subscriber count] customers and a strong track record. Or, if you want maximum stability and are willing to pay a bit more, we could look at the major carriers directly—AT&T, Verizon, or T-Mobile. What's most important to you: the lowest possible price, maximum stability, or somewhere in between?"

The Future of MVNO Regulation and Consumer Protection

The Mobi collapse may prompt regulatory and industry responses that affect how MVNOs operate and how dealers work with them going forward.

Potential FCC Actions

The FCC could implement new rules requiring MVNOs to provide advance notice to customers before terminating service, maintain customer service accessibility during business transitions or failures, facilitate number porting even when experiencing operational or financial difficulties, or maintain financial reserves or bonds to protect prepaid customer funds.

Such regulations would increase operational costs for MVNOs but would provide important consumer protections that reduce the harm customers experience when carriers fail.

Dealers should support reasonable consumer protection measures that increase customer confidence in MVNO services while not creating barriers that prevent legitimate new entrants from competing.

Industry Self-Regulation and Best Practices

Industry associations could develop voluntary best practices or certification programs for MVNOs that demonstrate financial stability, operational capabilities, and consumer protection commitments. Dealers could prioritize representing certified MVNOs, creating market incentives for carriers to meet higher standards.

Enhanced Dealer Due Diligence Requirements

Carrier networks (T-Mobile, AT&T, Verizon) that provide wholesale services to MVNOs could implement more rigorous financial and operational requirements for their MVNO partners, reducing the likelihood of sudden failures that damage the network provider's reputation and create customer service burdens.

Customer Education and Transparency

The wireless industry could develop standardized disclosures that help customers understand the differences between facilities-based carriers and MVNOs, the relative risks and benefits of different carrier types, and best practices for protecting themselves (such as documenting account information and using cloud backup services).

Dealers can lead this effort by providing transparent, educational information to customers that helps them make informed choices based on their priorities and risk tolerance.

Key Takeaways for Wireless Dealers

The collapse of Mobi offers critical lessons that every wireless dealer should internalize and apply to their business practices.

MVNO Failures Are Real and Can Happen Suddenly. Even MVNOs that appear stable, have major network partnerships, and are pursuing innovative technology strategies can collapse quickly due to internal conflicts, financial pressures, or management failures. Don't assume that any MVNO is "too established to fail."

Due Diligence Is Essential Before Representing Any MVNO. Conduct thorough research on financial stability, management team, wholesale agreements, customer service capabilities, and market position before agreeing to represent an MVNO. The higher commissions offered by smaller MVNOs may not justify the risks if the carrier fails.

Monitor Warning Signs Continuously. Watch for deteriorating customer service, payment delays, executive turnover, communication gaps, service quality problems, and other indicators that an MVNO may be in distress. Early detection gives you time to reduce your exposure and prepare customers for potential migration.

Prioritize Customer Protection Over Short-Term Revenue. When an MVNO experiences problems, your response will define your reputation and determine whether customers trust you going forward. Communicate proactively, help customers migrate if necessary, and prioritize their long-term satisfaction over protecting your commission income from the failing carrier.

Diversify Your Carrier Portfolio. Don't concentrate too many customers on any single MVNO, especially smaller or newer brands. Maintain a balanced portfolio that includes carrier-owned MVNOs, established independent brands, and carefully selected smaller carriers, so that if one fails, it doesn't devastate your business.

Document Account Information for Customers. Help customers document their account numbers, PINs, and other information needed for number porting, and encourage them to store this information securely. This simple practice can prevent the nightmare scenario Mobi customers experienced when they couldn't access their account information to port their numbers.

Build Direct Customer Relationships. Position yourself as a trusted advisor and ongoing resource for customers, not just a one-time sales channel. Customers who have direct relationships with you are more likely to reach out when problems occur, giving you the opportunity to help them and preserve the relationship even when a carrier fails.

Prepare Crisis Response Plans. Develop and document procedures for responding to MVNO failures, including how you'll assess the situation, communicate with customers, facilitate migrations, document interactions, and protect your business interests. Having a plan in place enables faster, more effective responses when crises occur.

Learn from Industry Failures. Stay informed about MVNO failures, bankruptcies, and operational problems across the industry, even for brands you don't represent. Each failure offers lessons about warning signs, risk factors, and best practices that can help you avoid similar problems with the carriers you do represent.

Balance Risk and Reward in Carrier Selection. Recognize that higher commissions, more aggressive dealer terms, or more attractive pricing often correlate with higher risk. Make conscious, informed decisions about which risks you're willing to accept based on your business model, customer base, and risk tolerance.

Conclusion: Building a Sustainable Dealer Business in an Uncertain MVNO Landscape

The collapse of Mobi serves as a sobering reminder that the MVNO business model carries inherent risks that can materialize suddenly and dramatically, leaving customers stranded and dealers scrambling to manage the fallout. For wireless dealers, the lesson is not to avoid MVNOs entirely—they remain an important part of the wireless ecosystem, offering value-focused alternatives that serve price-conscious customers and niche markets that major carriers don't prioritize—but rather to approach MVNO relationships with appropriate caution, rigorous due diligence, and robust risk management practices.

The dealers who thrive in this environment will be those who build their businesses on strong customer relationships rather than carrier relationships, prioritize long-term customer satisfaction over short-term commission income, maintain diversified carrier portfolios that balance risk and reward, conduct thorough due diligence before representing new MVNOs, monitor warning signs continuously and respond quickly when problems emerge, communicate transparently with customers about carrier options and risks, and position themselves as trusted advisors who help customers navigate an increasingly complex wireless landscape.

As analyst Roy Chua reflected onthe Mobi situation: "In all my interactions with him, he was a friendly and jovial entrepreneur with an ambition to upend the rules of the telecom game. It's unfortunate, and I hope the employees and investors at Mobi are made whole somehow."

This sentiment captures both the promise and peril of the MVNO business—ambitious entrepreneurs pursuing innovative approaches to wireless service, but operating in a challenging environment where thin margins, competitive pressures, and operational complexities can quickly overwhelm even well-intentioned ventures.

For the approximately 55,000 Mobi customers who lost service during the holiday season, many of whom couldn't port their numbers and faced unexpected expenses replacing devices and service, the collapse was more than an industry footnote—it was a personal crisis that disrupted their ability to communicate with family, conduct business, and access emergency services. As one frustrated customer noted: "He's wiped out every single system to contact the company. What a horrible thing to do! Especially around the holidays when money is already tight."

Wireless dealers have a responsibility to learn from Mobi's collapse and implement practices that reduce the likelihood of similar customer experiences in the future. This means being more selective about which MVNOs to represent, more vigilant about monitoring carrier health, more proactive about communicating with customers when problems emerge, and more committed to helping customers navigate carrier transitions when failures occur.

The MVNO landscape will continue to evolve, with new entrants launching ambitious ventures, established players consolidating market position, and inevitable failures occurring as companies that can't achieve sustainable economics exit the market. Dealers who understand these dynamics, conduct appropriate due diligence, manage risks effectively, and prioritize customer protection will build sustainable businesses that weather industry turbulence and earn lasting customer trust.

As Burdette himself reflected on Mobi's collapse: "It is very sad and heartbreaking what so many folks worked so many years at Mobi to build. We got very close to being able to prove that all out… If I knew what to have done and could go back in time, I would certainly do whatever I could to try to change that." This acknowledgment of failure and regret offers little comfort to stranded customers and unpaid employees, but it serves as a reminder that even experienced operators with good intentions can find themselves overwhelmed by the challenges of running an MVNO in today's competitive wireless market.

For wireless dealers, the message is clear: approach MVNO relationships with eyes wide open, implement robust risk management practices, prioritize customer protection, and build your business on a foundation of trust, transparency, and long-term customer relationships rather than short-term commission opportunities. The carriers that survive and thrive will be those with strong fundamentals, sound management, adequate capital, and sustainable business models. Your job as a dealer is to identify those carriers, represent them responsibly, monitor them continuously, and be prepared to help customers transition when the inevitable failures occur.

The Mobi collapse is not the first MVNO failure and won't be the last. But by learning from this experience and implementing the practices outlined in this guide, wireless dealers can protect their customers, preserve their reputations, and build sustainable businesses that deliver value to customers while managing the inherent risks of the MVNO ecosystem.