Mobile users in India seem to be a reluctant lot when it comes to shifting loyalties, even if the services they get are sometimes of poor quality. A year after the launch of mobile number portability (MNP), only 26 million subscribers have opted for such a change, which is 4% of a total base of 884 million users. MNP in India was launched on January 20, 2011.
This falls much short of telecom watchdog Telecom Regulatory Authority of India’s (Trai) projection of 10% of users using MNP to change service providers in the first year. Moreover, of the 26 million who made “port out requests” till November 2011, many would have been retained by their operators, who swung into action to prevent customer erosion.
“We have seen that unlike internationally, where the incumbents tend to lose subscribers in the initial period of MNP, in India, the incumbents have gained subscribers,” said an official with a company that provided the technology that enabled MNP.
While Vodafone India is the largest gainer in the MNP race, Anil Ambani-led Reliance Communications (RCom) and Tata Teleservices has lost the most among private players, the official said, not wanting to be named. For the eleven months to November, Idea and Vodafone gained 17 lakh and 12 lakh, respectively, while RCom and Tata lost 13 lakh and 9 lakh subscribers, respectively.
“Our strategy from the very beginning of MNP was to gain postpaid and high-value customers, who were trapped with incumbent telcos, and we have achieved the objectives we had defined for ourselves,” said AnuragPrashar, president corporate, services, RCom. “We believe that large number of port-ins, driven by short-term tactical trade and customer offers, is not a good business strategy as it merely induces rotational churn. This is borne by the fact that three fourths of the customers porting out have been at zero or very low ARPU. Our sustained focus on quality has ensured that MNP continues to be a value driver for us.”
Companies which implemented this service in India consider 3% port-out request to be in line with global standards. “We have recorded a porting percentage of 3.5%, which is a respectable number as per international standards in the first year,” the official quoted above said.
More and more CDMA customers are switching to GSM operators. Reliance and Tata CDMA services have suffered combined loss of more than 16.37 lakh customers in MNP. This service has made telecom operators focus on quality of subscribers and not sheer numbers.
Opsbuds Solutions, a market research company, said good coverage and brand image are the top two reasons for preferring a service provider in all the metro circles. In circles other than metros, subscribers look out for customised services and low recharge rates.
“Introduction of MNP has compelled operators to improve service quality,offer attractive promotional packs, improve network coverage and introduce value-added services to retain customers,” said Opsbuds in an email response.
Consultants tracking the sector disagree, and say MNP is just another option for a few number conscious subscribers. In India 10-15% prepaid subscribers, who account for almost 95% of the total subscriber base, change their operators every month.
“MNP has been no game changer in the Indian market as average churn rate is 3% per month,” said GirishTrivedi, co-founder & director, Monk Consulting. “I feel subscribers are churning, but not with their numbers. Also, with 30% of inactive subscribers, Indian telecom sector has become a multi-sim market with all operators offering same deals and same quality levels.”
Subscribers who availed MNP are not quite satisfied as their value-added services and other tariffs are almost the same as other service providers. PrateekSinha, 29, a doctor from Mumbai, struggled with his operator for almost three months to allow him to port out. “As an option it is great, but it was a mental harassment to go through that procedure,” said Sinha. “There is no major difference except contact centre experiences.”
Another interesting fact about the service is that the highest port out requests have come from the states of Gujarat and Karnataka. Players implementing MNP in these states say that this is because of higher levels of awareness and proactiveness on the part of few operators in attracting new customers through MNP.
Source: Financial Express (http://www.financialexpress.com/news/mnp-loses-charm-among-users/901665/0)