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'3% will opt for number portability'
Amidst all the hype about mobile number portability (MNP), which allows customers to change their operator and retain their number, t
his facility may not be a significant game changer in India and erode telcos’ subscriber numbers.

The two companies chosen to implement MNP in India -- Syniverse Technologies and MNP Interconnection Teleco Solutions -- have told the telecom regulator Trai that less than 3 per cent of the country’s projected 550 million-plus mobile users will go in for MNP by 2010 (based on their surveys).

MNP is slated to come into effect in metros and large states in September 20, 2009 and the rest of the country from March 2010. Syniverse & MNP Interconnection in their presentations to Trai have said that India is likely to have over 800 million subscribers by 2013, off which less than 30 million were likely to change their operators using the MNP provision.

Syniverse will implement MNP in Northern and Western India while MNP Interconnection will provision this facility in the South and East zones of the country. Importantly, these two companies have proposed to charge customers between Rs 75 - 200 everytime they want to change their operator.

Syniverse Technologies and MNP Interconnection’s analysis comes even as data from cellular industry associations reveal that Indian operators are confronted with whooping 40 per cent annual churn rates. Telecom regulator Trai too shares the view that churn may not translate to customers opting to port their operator:

“One can argue that these are the mobile subscribers who are willing to change their service providers without bothering to retain their mobile telephone numbers. Therefore, even after the introduction of MNP, these subscribers will still churn without going through the process of porting,” Trai said in its consultation paper on this issue.

Trai’s analysis has revealed that these customers may not opt for MNP especially since it costs less than Rs 50 to take a new prepaid lifetime connection. “However, the other argument could be that if the porting charge is minimal or if the recipient operator is willing to absorb the porting charge then a substantial number of these subscribers may opt for porting of their mobile numbers too,” Trai has pointed out in its consultation process.

But Trai’s views may not find takers in the industry. “A good majority of those who constitute this 40% churn are low-end customers who generate low average revenues. It does not make a business case if operators must pay up to Rs 200 and bear the porting charges when cost of acquiring a new customer or selling a fresh connection is lower than this figure,” explained an executive with a leading GSM operator.

Another executive with a telco pointed out that the Trai’s draft norms for MNP indicated that the process of changing one’s operator would be complex: “Churn customers, who are on the lower end of the pyramid will not go through a multi-stage process to change his or her operator considering that MNP comes with a three-month lockin,” he added.

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