| 1. What is MNP? | | | | clearing house stating the company selected as |
| Mobile number portability (MNP) allows mobile | | | | Mobile Number Portability Service Provider had no |
| users to retain their numbers when changing | | | | experience in running telecom operations and this |
| from one network operator to another. Mobile | | | | company had a set-up in Pakistan. However, the |
| number portability will be applicable to both CDMA | | | | ministry finally cleared the agency in April 2010. |
| and GSM technologies and also to post paid and | | | | Currently DoT has issued licences to two |
| prepaid categories of customers. Singapore was | | | | companies - Syniverse Technologies India and |
| the first country in the world to implement MNP in | | | | MNP Interconnection Telecom Solutions - for |
| 1997. India is one of the few countries where | | | | implementing number portability in India. MNP |
| the subscribers are yet to enjoy the benefit of | | | | Interconnection is a 74:26 joint venture between |
| MNP. The biggest upside of MNP will be an | | | | US based Telcordia and Deepak Talwar |
| improvement in the quality of network and | | | | Consultants. Under the current telecom |
| customer service expected from the telecom | | | | regulations, DoT has split the country into two |
| operators. It could marginally reduce tariffs | | | | number portability zones, with each zone |
| particularly in the areas like international roaming | | | | comprising 11 circles. Each 11 circle MNP Zone is |
| and VAS. | | | | to be serviced by a separate MNP solutions |
| 2. MNP Process | | | | provider to pre-empt a monopoly situation. |
| The process of moving a mobile number from | | | | 5. Challenges in roll out |
| one operator to another is called "porting". To | | | | To implement this proven porting and call routing |
| complete the port, the subscriber's mobile number | | | | process, mobile service providers need to upgrade |
| and the recipient's network ID are paired and | | | | their infrastructures to enable appropriate |
| updated in a master centralized database. This will | | | | re-routing of calls to subscribers who have ported |
| be facilitated by a separate agency called Mobile | | | | out of their network. Huge Capex is required for |
| Number Portability Service Provider, which will be | | | | each operator to implement this process.The |
| acting as number portability clearing house and | | | | operator preparations for these model take time, |
| maintain centralized data base services. | | | | and the manner of handling such routing and data |
| India will use a recipient-operator initiated method | | | | management is critical, as any inefficiency will |
| of porting. This is as per the international standard | | | | directly lead to inefficiency in transmission as well |
| where a customer wishing to port his number will | | | | as errors in switching. |
| contact the new Recipient operator who will then | | | | While new telecom operators are betting on |
| complete the process of porting with the Donor | | | | mobile number portability to acquire new |
| Operator. The other method is Donor-led-Porting, | | | | subscribers, established players are worried about |
| which is considered neither an efficient process | | | | the ‘abnormal' churn it would result in. The |
| nor customer friendly. | | | | success of MNP is measured by the percentage |
| A major technical challenge to MNP is the routing | | | | of ported numbers. TRAI has estimated the |
| of calls and messages to a number after it is | | | | porting rate to be around 10% in the first 15 |
| ported. The best international practice is the use | | | | months and 7%, 6% and 5% respectively for the |
| of a central database (CDB) of ported numbers. | | | | successive three years. However according to |
| Once the donor operator has disconnected the | | | | industry observers, after an initial churn, there will |
| mobile number and the recipient operator has | | | | not be significant shifts by subscribers from one |
| activated it, the MNP service provider allocates | | | | operator to another. In the countries where MNP |
| the corresponding Location Routing Number to the | | | | was introduced, it produced mixed results. For |
| ported number in the Number Portability Database | | | | example, it was successful in Hongkong, where |
| and broadcasts the updated Location Routing | | | | the number of ported numbers went very high |
| Number along with the ported mobile number to | | | | during the first 3 years. However in the case of |
| all Access Providers and International Long | | | | Singapore and Taiwan it did not create much |
| Distance Operators who shall update their | | | | impact. The operators in these countries managed |
| respective Local Number Portability Database. | | | | to retain the customers through various options |
| Whenever a call is made to a ported number, the | | | | like long term service contracts and better |
| operators will query it to find out which network | | | | customer service. |
| to send a call to. This is also known as All Call | | | | The Indian scenario is complex and there are |
| Query (ACQ) and is highly efficient and scalable | | | | many factors which will influence the outcome of |
| model. A majority of the established and | | | | MNP |
| upcoming MNP systems across the world is | | | | 1. One major factor to be considered in India is |
| based on this ACQ/CDB method of call routing. | | | | the presence of large prepaid customers whose |
| India has selected the ACQ model for call routing. | | | | loyalty is already very low. Therefore MNP will |
| The porting process will take a maximum time of | | | | have an impact only on the post paid customer |
| 36 hours in all licensed service areas except in the | | | | base. |
| case of J&K, Assam and North East where | | | | 2. Secondly the prices are already very low and all |
| the maximum time allowed is 10 days. The | | | | the operators are facing margin pressure. |
| window period for disconnection and activation by | | | | Therefore the possibility of existing operators |
| operators has been kept at one hour each. | | | | getting into another price was is remote. |
| MNP is available only within a telecom circle. A | | | | 3. The third factor is the launch of 3G services in |
| subscriber is eligible to make a porting request | | | | India. This will be a major tool for retaining the |
| only after 90 days of the date of activation of his | | | | customers as well as churning the customers |
| mobile connection. If a number is already ported | | | | from non 3G operators. |
| once, it can be ported again only after 90 days | | | | 4. Finally there are a large number of new |
| from the date of the previous porting. TRAI has | | | | operators like Uninor, MTS, Videocon, Etisalat etc |
| explained that this minimum period is required to | | | | who have entered the Indian telecom market |
| enable the service provider to recover the | | | | recently. These operators are anxiously awaiting |
| customer acquisition cost. After porting of a | | | | MNP roll-out to churn the high value customers |
| mobile number, if it remains disconnected for 90 | | | | from the incumbents. |
| days, it will be reversed back to the original | | | | Incumbent service providers like Airtel, Vodafone, |
| operator. | | | | Idea and RCom have already started focussing on |
| 3. Charges for MNP | | | | network availability and coverage and customer |
| There are three types of charges payable either | | | | service. Incumbents are focussing on retaining |
| by the subscriber or by the telecom operators. | | | | their high-value mobile users, who are business |
| Per Port Transaction charge is paid by recipient | | | | users, or high networth individuals. With MNP, the |
| operator (the operator to which the subscriber | | | | big players could easily attract post paid or |
| shifts his connection) to Mobile Number Portability | | | | business users from other lower performing |
| Service Provider. | | | | service providers. In the highly penetrated metro |
| Porting charge is payable by the subscriber for | | | | markets like Delhi and Mumbai the focus will be no |
| porting his number to the recipient | | | | longer on gaining new subscribers, but on retaining |
| operator. TRAI has capped the porting charge at | | | | the current base, and increasing the average |
| Rs. 19. The regulator has also noted that | | | | revenue per user. It is expected that MNP will |
| operators are free to charge any amount less | | | | result in increased cost for the operators for |
| than this. There is no need to make any payment | | | | improving the customer service and network |
| to the existing operator. | | | | quality. Its impact on revenue share is likely to be |
| Dipping charge is paid by the telecom operator | | | | marginal. Consolidation is also expected very soon |
| who uses the query response system of the MNP | | | | and MNP could be one of the triggers. |
| service provider for obtaining location routing | | | | 6. To sum up |
| number for correct routing of the called number. | | | | India has 630 million mobile subscribers as on May |
| 4. MNP roll out in India | | | | 31, 2010. Even though there are 14 players, the |
| MNP was to be implemented in a phased manner, | | | | market is dominated by Airtel, Reliance |
| and the first phase was to start in Metro cities | | | | Communications, and Vodafone, which together |
| and A circles by December 31, 2009, and the | | | | control majority of the customer market share. |
| second phase, in the rest of the country by | | | | The launch of 3G services will play a major role in |
| March 2010. The Government later decided to | | | | deciding the direction of MNP-related |
| implement it in the entire country in one go by | | | | churn. Subscribers of non-3G operators |
| March 31, 2010. The launch of Mobile Portability | | | | are expected to move to 3G operators after |
| Services was again extended to June 30, 2010, | | | | the MNP roll-out. Superior network coverage and |
| due to a lack of readiness of various stake | | | | customer service will be the other key drivers of |
| holders. | | | | MNP. |
| Recently for the fourth time, the Government | | | | Even though telecom operators are downplaying |
| has extended the deadline to October 31, 2010, | | | | the impact of Mobile Number Portability, they |
| as the testing of MNP is yet to be completed by | | | | would be hard-pressed to retain high-ARPU |
| various telecom operators. While only 14 per cent | | | | customers, many of whom have been continuing |
| of the mobile networks across the country is so | | | | with the same telecom operators just for the |
| far ready for the introduction of MNP, 36 per | | | | sake of retaining the mobile numbers despite poor |
| cent is in progress. In the case of remaining 50 | | | | customer service and network congestion. |
| per cent, testing is yet to be done. While the | | | | Competition has always been good in any industry |
| private players are slow with testing, state-run | | | | and with more healthy competition expected, |
| BSNL and MTNL have not even set up MNP | | | | more innovation, solutions, and competitive pricing |
| gateways. | | | | is anticipated from mobile service providers. This |
| Apart from testing delays, MNP also ran into | | | | will subsequently lead to more consumer interest |
| trouble with the home ministry and the FIPB over | | | | and usage, thus resulting in revenue growth.MNP is |
| security clearances. The home ministry had | | | | another major event anxiously awaited by |
| voiced its concerns over the selection of the | | | | telecom observers. |