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 Monday, January 24, 2011

­Mobile Number Portability (MNP) was introduced in Haryana in December 2010 and thereafter will be introduced across India in January 2011, a move that is expected to further intensify competition in the already crowded mobile services market. In ICRA's opinion, with implementation of MNP, subscribers would get a wider choice and would be able to switch between service providers easily, thereby compelling service providers to offer competitive pricing plans and offer higher service quality to attract and retain subscribers.

In ICRA's view, direct fallout of implementation of MNP would be an increase in customer churn. Change in mobile number has been a major deterrent in switching service operators in the past, especially for high usage customers; however, with the implementation of MNP, customers would be able to easily switch from one service provider to another without changing their mobile number. Moreover, ICRA expects, the low porting charges (maximum of Rs. 19 per porting to be paid by the subscriber) and low porting time (7 days for all circles except Jammu & Kashmir, Assam and North East where the maximum time period for completing the porting process would be 15 days) to drive the adoption of MNP in India.

Increase in the churn is expected to increase the customer acquisition and retention costs of operators, which coupled with competitive tariff plans and falling average revenue per user (ARPUs) is expected to result in a decline in the operating margins of the telecom operators especially in the short term. Under such a scenario, telecom operators with stronger financial profile would be better placed to cope with the increasing competitive intensity.

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Source: Cellular News
Monday, January 24, 2011 11:22:33 AM (W. Europe Standard Time, UTC+01:00)  #     |  Related posts:
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