Mobile Number portability: Service Providers perspective

The introduction of MNP served as a motivator for various telecom operators to provide their customers with the finest possible services. Users, on the other hand, chose MNP for a variety of reasons. Attractive telecom services are provided to new subscribers. Users can change operators at no cost. When you switch operators, you don't have to alter your phone number. Subscribers will receive a new SIM card with the necessary dimensions. The subscriber has entire control over switching from prepaid to postpaid service and vice versa. Existing service providers may attempt to improve their services and offers.

Need for implementation of MNP:

The introduction of MNP served as a motivator for various telecom operators to provide their customers with the finest possible services. Users, on the other hand, chose MNP for a variety of reasons. Attractive telecom services are provided to new subscribers. Users can change operators at no cost. When you switch operators, you don't have to alter your phone number. Subscribers will receive a new SIM card with the necessary dimensions. The subscriber has entire control over switching from prepaid to postpaid service and vice versa. Existing service providers may attempt to improve their services and offers.

It lowers the barriers to customers switching networks, expanding their options. More options mean more competition among operators to maintain and attract customers, resulting in improved service quality and lower pricing.

From the consumer's perspective, despite being dissatisfied with the service provider (operator) for any reason, a customer (or consumer or subscriber) thinks twice before switching operators. The reason for this is because if he changes service providers, he will have to give up his well-known mobile number. The older the phone number, the more difficult it will be for him to change it. For both individual and business customers, the issue is equally complicated.

The exponential increase in the number of grievances and pending cases in consumer courts can be viewed as a live example of subscriber unhappiness. Despite knowing this for a long time, the operators have done little ?to improve customer service.

MNP would undoubtedly provide an option for dissatisfied subscribers to switch operators in the hopes of receiving better service, and hence would be a solution to all of their complaints. As a result, operators would be compelled to improve their services and customer response time in order to retain customers.

Any operator's subscriber is an asset, and no operator wants to give up that asset for reasons that are entirely within its control. Operators with strong services and reasonable pricing plans will be able to attract and retain customers with the implementation of MNP. In the end, the free market norms would triumph, and only serious players with good services would be able to stay in the market, while incompetent businesses would be driven out due to subscriber migration.

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?Pros and Cons of MNP for Telecom service providers:

?Pros:

?Optimum utilization of network and spectrum: Since the introduction of MNP in India, the network and spectrum have been used to their full potential. TSPs in India will gain from utilising their resources to their full potential, resulting in improved service quality for their customers/users. Various service providers like as Airtel, Vodafone, BSNL, and others will be driven by updated networks that result in better services.

?Intensify the competition: Mobile Number Portability will increase competition, allowing service providers to improve their service quality by giving more diversity and originality in their products. This will help them gain more subscribers and increase revenue in the long run.

?Standardized market rate: While MNP enhances competition significantly, it also standardises market rates, resulting in some homogeneity in the industry. It will level the playing field for emerging service providers to make significant contributions to the Indian telecom sector.

Improves market share: The introduction of MNP would lessen the imbalance between the incumbent's market share and that of a new entrant. The incumbent's loss is larger than the additional profits received by the newcomer. As a result, the overall profitability of the industry will be reduced..

Brand Value: The service provider's brand image will aid them in attracting a large number of new subscribers, but it will also create an opportunity for other small competitors to build their brands by providing better service, unique VAS, and prompt responses to consumer queries.

Better use of infrastructure and resources: As a result of the increased competition brought on by MNP, service providers will be able to utilise their infrastructure to its full potential. This will also aid in the efficient use of resources and the reduction of waste.

Cons:

?Fluctuating Customer Base: Prepaid mobile services are preferred by the majority of Indian mobile users, at least those in the country's major cities, over post-paid, billing services. These subscribers, too, do not have a high level of loyalty. Customers may also opt not to go through the onerous procedures MNP requires at this time because it is quite straightforward for them to switch carriers.

High barriers to entry: Due of the high cost of switching, entrants must price aggressively to compete with the incumbent. MNP will make it easier to enter the market by removing the requirement to price aggressively. There may, however, be countervailing impacts. Due to the so-called "fatcat" effect, incumbent mobile operators are less likely to fight entrance by aggressively dropping rates in the absence of MNP if they have a big captive customer base due to switching costs. MNP, on the other hand, makes incumbents more aggressive, making market entry less appealing to new operators. As a result, the net effect of MNP on entrance is uncertain.

Huge need of investments: The introduction of MNP is likely to have an impact on both incumbents and potential competitors' investment incentives. Standard arguments argue that implementing MNP will lower incumbents' incentives to make cost-cutting efforts since the cost-cutting investments will apply to a smaller client base. In contrast, rivals' incentives to make cost-cutting investments should rise, with an uncertain overall effect. Even less obvious are the collective effects on demand-enhancing investment, such as infrastructure quality or product innovation. Because the value of a captive subscriber decreases, device prices will rise, while mobile service rates will fall as competition intensifies.

Increase in Administration Cost (Customer Transfer Cost): These are the costs of customer transfer or porting. They include costs incurred by service providers in closing an existing account, opening a new account, and coordinating network operators in the switchover of the mobile number and call routing; costs of new handsets or SIM cards; and caller costs (the additional delay in setting up a call to a ported number)

Additional investment in advertising, promotion and campaigns: With increased competition, service providers will need to invest significantly in advertising, promotion, and campaigns. They'll have to put in a lot of work to attract new clients while also keeping the ones they already have. To attract new clients, TSPs will need a robust advertising and marketing back-up, which will increase their costs.

?CRM enhancement: The most critical component for a service provider is customer relationship management. TSPs will be burdened because they will have to devote more time and effort to updating the CRM and maintaining each customer's database. New client data will be obtained and stored, necessitating the addition of more servers, databases, and processing equipment. CRM will get more difficult as a result of this.

Software and system upgradation: Upgrading software and system maintenance lines to stay up with regulatory changes is a time-consuming task that will require a significant amount of manpower as well as capital..

The Challenges:

Huge Costs: To address the growing demand in the telecom services sector in India, an investment of Rs 50,000 crore is required over the next three years. For the mobile services industry, a significant share would be required.

Customer Retention/Increased Competition: In the post-MNP age, service providers are likewise concerned about losing consumers and income.

?Infrastructure Upgrade: A company's hardware and software capabilities must be upgraded to accommodate MNP, which will incur costs.

Cost Recovery and Bill Reconciliation/Query Processing: When a customer decides to switch, the old service provider (OSP) must run a query to see whether there are any outstanding billing amounts that must be recovered before the subscriber can migrate to the new service provider (NSP).

Before the MNP may be implemented, the regulator must resolve a number of difficulties. The limited mobility vs mobile services, carrier access code (CAS), finalisation of the Interconnect Usage Charges (IUC), and other issues are among the most important.

Conclusion:

As a result, this was an introductory report on Mobile Number Portability (MNP) and its benefits and drawbacks from the perspective of service providers. It provides a bird's-eye view of the situation. Overall, it is a benefit and a major utility from the perspective of customers, but it is a very cutthroat competition for service providers, as it may result in a loss of revenue, and the churn rate in the telecom industry is very high, plus the technology investment is an added problem for small players. As a result, they've added another question to their survival challenge.

Manish Tiwari