Mobile Number Portability is in – switch operator, not your mobile number

Milestone achieved.
DoT (Department of Telecommunication) has finally given the green signal for Mobile Number portability (MNP). MNP will be implemented phase wise and will be first achieved in 4 metros (i.e. Delhi, Mumbai, Kolkata and Chennai, which account for 18% of subscriber base) by Q4 ’08. MNP will be extended to more parts of the country in the next phase.

Market surveys have shown that up to 50% of all mobile users in India are unhappy with their operator, and are willing to switch to another service provider if allowed to retain their number.

Details of Mobile Number Portability

The DoT’s move is in line with the recommendations of telecom regulator Trai. DoT, in a statement, said all mobile operators, through a neutral third party, shall establish a “logically centralised database, the cost of which would be borne proportionately by the telcos.”
This implies, a telecom company that has 20% market share in the circle, will bear 20% of the cost of creating the centralised data base. All that the customer has to do is approach the recipient operator for porting the number, the DoT said.

A few numbers on GSM/CDMA ARPU

  • Overall GSM ARPU stands at Rs. 297
  • ARPU for post-paid GSM service stands at Rs 655
  • ARPU for prepaid GSM is Rs 248
  • For the CDMA segment, ARPU per month stands at Rs 206. [all data as per TRAI’s June ’07 release)

Though the move has been welcomed by CDMA operators, GSM lobby believes

“It seems that mobile number portability was being introduced to benefit a select operator that wants to enter the GSM segment and thereafter poaching on the subscribers of existing GSM players,”

Operator, in context is of course Reliance (which is planning to shake up the GSM market by slashing call rates by 30%!)

As far as GSM operators are concerned, Mobile Number Portability will significantly impact margins (as they need to keep the quality of service very very high to retain subscribers) and smaller players will obviously face the heat (more churn).

What’s your opinion? Do you foresee more backlash between GSM and CDMA operators in the near future?
Are GSM operators scared of Reliance’s entry?

Do share your opinion.

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