The Nigeria communication Commission (NCC) has commenced the pilot phase of the mobile number portability (MNP) in Nigeria. A consortium of three firms, Interconnect Clearing House Nigeria (ICN), Telecordia of the USA, and Saab Grintek of South Africa won the bid to operate the MNP.
In the last quarter of 2012, service providers commenced the integration of their systems with telecommunication providers’ Operation Support Systems (OSSs) and internal business processes. The licensed telecom companies (Telcos) have also consistently indicated readiness to embrace the scheme despite the competitive pressure it represents.
Opinions vary on the likely impact of the adoption of mobile number portability on the sectors dynamics, particularly on the competitive landscape, the Quality of Service (QoS) and benefits to users. While the adoption of MNP may intensify competition, the impact on QoS would depend largely on the capacity of the telecom companies to make additional investments in technology and network expansion. This will be necessary in order to withstand any surge in users.
The scheme is poised to transform the telecom sector positively in favour of subscribers but could be self-defeating where stakeholders’ activities, including the regulators, are not complementary especially in relation to the incentives for operators to increase capacity when necessary.
Switching Network Provider
Mobile number portability allows mobile subscribers retain their existing mobile phone number when the subscriber switches from one access services provider (Operator) to another irrespective of mobile technology. According to the NCC’s Regulatory document on MNP, Business Rule and Porting Processes (BRPP), Nigeria is adopting the direct routing method. This method relies on the operation of a central database (CDB) or central clearing house and is appropriate for countries with multiple Telcos.
The porting process is expected to commence with the user requesting for port through the potential recipient telecom firm. The recipient company is responsible for verifying the authenticity of the request including eligibility. The recipient Telco then processes a Porting Approval Request (PAR) message to the central order handling system (COHS). The customer is expected to be fully ported on the new network in two days for prepaid and post-paid single order lines and in five days for post-paid multiple order lines. At the point of porting, the customer is expected to swap his/her current subscriber identification module (SIM) with that of the recipient Telco. The mailbox number for voice fax cannot be transferred; in addition, the mailbox number for voice fax cannot be ported.
Operators To Bear Costs
The MNP Business Rule and Porting Processes mandates the Telcos to bear the costs of the system upgrade that is required for them to participate in the scheme. Individual Telcos are expected to establish MNP in line with their service license obligations. Hence, the costs of infrastructure may differ from one company to the other. Neither recipient nor donor Telcos shall be allowed or entitled to charge customers for requesting to use the porting service or for porting their numbers. In addition, ported customers must not pay call charges differently from ordinary customers afterward.
Migration Expected to Boost Quality of Services
At full implementation, the MNP scheme is expected to enable users to migrate seamlessly from one network provider to another. It should remove the current need to own and maintain more than one mobile line in the bid to avoid the challenges of interconnectivity glitches as customers are able to migrate within minutes as currently obtainable in Australia and perhaps seconds as it operates in Singapore.
It has been argued that the ensuing competition and Telcos bid to retain or attract customers would drive voice and data tariffs further downward as well as result in significant improvement in quality of service. It is also expected to drive further network expansion as Telcos expand coverage to uncovered rural areas in the bid to boost market share. This is of particular importance for the new entrants in the industry. The biggest impact would perhaps be felt in the area of QoS because consistent network glitches are likely to be more responsible for loss of customers than call charges. Hence, the development will likely lead to improvement in customers service in terms of conflict resolution and quality of relationships.
Incentive for Service Providers
The fact that customers would be able to migrate their numbers between networks at no cost to them provides an incentive to do so. However, the combination of the restriction on the number of movements possible within a defined period and porting duration could moderate the expected size of impact. While it will take a minimum of two days for a single porting transaction to be completed, only one migration is permissible in 90 days. In other words, despite being free, customers may not be able to make the switch as quickly as they perhaps would prefer. In this respect, the MNP scheme may not be able to eradicate the incidence of multiple SIM ownership immediately.
Analysts have argued that where network operators, especially smaller ones, fail to make the necessary upgrade in infrastructure and expand capacity, a surge in migration to any of them could make the network increasingly inefficient. This may result to high network glitches. Newly migrated customers would then find themselves hooked to an increasingly inefficient network due to overloading for three months. The 90-day restriction is therefore an appropriate incentive for operators to make the necessary investment, given that this would ensure they have a fixed period of time to impress new customers.
Global Evaluation of MNP
Since the 1990s, many countries have embraced the use of number portability, driven largely by regulators as their telecommunication markets become more competitive. Results have been mixed. Hong Kong and Singapore were the first to implement number portability in the late 1990s, with recent implementation in Japan and Malaysia. The US instituted number portability for subscribers of both fixed and mobile services in November 2003. The EU mandated all its member states to adopt the use of number portability in July 2003 to sustain telecom competition. In Africa, South Africa and Egypt were the first to adopt number portability before Kenya, Ghana and now Nigeria at the verge.
The UK is trying to switch to a centralised solution from the earlier Singaporean model which is technically a mere call forwarding scheme. It mandates the donor operator to forward subscribers’ incoming calls through the same number to its destination once registered as a ported number with a recipient operator. Singapore itself fully migrated to the data base driven model in 2008. The UK telecom regulator is working round the clock to move to the central data base model due to complaints from subscribers. In the US, the record of performance in the first eighteen months of operation was well below expectation. While the US telecom regulator and operators expected about 30 million subscribers to have transferred their wireless numbers within the first 12 months of MNP, only about 7.8 million complied.
MNP In Kenya, Losing Its Appeal
According to statistics from the Communications Commission of Kenya (CCK), in July-September 2012, there were only 217 in ports against a subscriber base of 30.4million. The highest quarterly figure ever achieved was 36,224 after which a substantial number of subscribers shunned the service. This is because it is cheaper to own and use SIM cards from each of the four major operators in Kenya than to migrate from one to the other using the same number.
Porting charge is between sh173-sh200 while a new SIM can be obtained for sh50. In addition, the 2-days porting period is considered too long. Since subscribers cannot transfer the balance in their mobile wallet after porting, the use of mobile money, a major industry in Kenya, also negatively affected subscribers’ interest in mobile number porting.
Ghana –The Most Recent Success In MNP Adoption
Having started in July 2011, Ghana has been able to reduce porting time from 24 hours at inception to between 2 to 22 minutes. Mobile customers who wish to change networks without changing their number need to only provide their mobile phone (with SIM) and a form of identification to a telecom shop or agent of the network they wish to join. In the first year of operation, a total of 370,107 mobile numbers (1.06% of active subscribers in Ghana) were moved between networks by their owners. Ghana has one of the fastest porting processes globally and perhaps the best in emerging markets. The success recorded by Ghana was due primarily to simplicity of the process and speed of porting between networks.
NCC Needs To Streamline Processes
As Nigeria commences the MNP scheme, there is the need to increase operational efficiency and perhaps further streamline the number porting process. While the scheme can commence with 2-day porting duration for a single account, efforts should be made to reduce the duration to a few hours or minutes eventually. Targets and timelines for this must be set from inception. The mandate to process porting at no costs to subscribers is commendable and removes the challenges of higher costs relative to owning multiple SIM cards.
It is however important to note that operators globally are known to be unwilling to adopt the MNP scheme; however, all the industry players in Nigeria have signified their interest in the scheme in terms of technical and operational preparedness. Adopting MNP will arguably affect the competitive landscape in Nigeria’s telecommunication industry. Operators are not unlikely to implement strategies to attract as many users of other networks as possible. This would perhaps be helpful as porting duration improves as experienced in Ghana.
The extent to which MNP will however affect QoS is debatable as operators are faced with the need to make addition to the non-recoverable costs of acquiring new subscribers through the scheme. If porting speed is reduced to minutes rather than days, and operators face the potential of losing or gaining unprecedented number of subscribers in minutes rather than in days, they may be attracted to make this necessary investment. Therefore, the NCC needs to devote appreciable attention to reducing porting time so that the MNP program will be able to deliver the expected results.