Can I switch networks now? ECTEL consultation on number portability

Number portability is still being introduced in the English-speaking Caribbean. This post examines this important feature of competitive telecoms markets.

On 22 June, the Eastern Caribbean Telecommunications Authority (ECTEL) launched a public consultation on Policy Recommendations for the Adoption of Number Portability in ECTEL States. The consultation is currently underway in the five ECTEL member territories, namely, St. Kitts and Nevis, Dominica, St. Lucia, St. Vincent and the Grenadines, and Grenada. A two-tiered process is being used. The first phase, comments on the initial consultation document, are due by 3 August, and the second phase, comments on initial responses, will run from 8 August to 2 September 2011.

Over the last ten years in particular, number portability (NP) has been introduced, to varying degrees, in a number of telecoms markets worldwide. As a result, there is a sense in the Caribbean that its launch in the region is long overdue. However, most people have no idea what it entails, and more importantly, key considerations associated with its establishment. This post aims to provide some insight into this critical undertaking.

What is number portability?

NP speaks to the ability of subscribers to retain their telephone numbers when changing service providers. The markets that are eligible for portability are usually the fixed and the mobile/cellular services. Portability tends to fall into two categories, either

  • restricted, where number transfers are confined to different providers in the same market, e.g. between fixed-line service providers, or between mobile service providers, or
  • intermodal, where number transfers are allowed between different markets, e.g. between fixed-line and mobile services.

Portability can also be limited to specific geographic or service areas, or even to particular technologies. The regulator, usually following consultation with stakeholders, determines the conditions and scope of the portability that will be implemented.

What is being proposed by ECTEL?

ECTEL’s consultation document aims to establish broad policies on NP, with the intention that the service will become mandatory by 1 September 2012. In this first instance, the organisation recommends that NP be restricted to, between fixed service providers, and for post-paid customers, between mobile service providers.  In other words, prepaid mobile customers will not be eligible to transfer their telephone numbers. This initial position will be subject to further study, and to ascertaining the demand for portability by prepaid customers.

With regard to the technical solution to realise NP, ECTEL requires service providers to recommend an appropriate solution that should

… be flexible enough to accommodate the different types of networks … take into account emerging issues … facilitate true portability… be cost effective, efficient and provide maximum value to subscribers …

As expected, the implementation costs for NP will depend on the solution selected. ECTEL recommends that providers bear these costs, and implement a system that successfully transfers a number within 24 hours.

NP considerations and implications

1.  Longstanding use of a particular telephone number can become a subscriber’s personal identifier and consequently, a powerful deterrent to change service providers if the number cannot be transferred. However, NP introduces a more fluid arrangement for assigning numbers to service providers, and essentially shifts the control of numbers to subscribers. Further, customers are empowered to exercise greater choice in deciding which provider best suit their needs at any given time.

2.  With regard to service providers, NP fosters competition, since customers are no longer locked-in to a particular provider in order to continue using desired numbers. Hence providers may need to redirect more of their focus to service quality in order to attract and retain customers. Further, over and above the costs of implementing NP (depending on the solution selected), there are numerous administrative and logistical considerations that providers must address collectively in order to achieve a seamless and well-functioning porting system.

3.  Traditionally, there were concerns that NP was prohibitively expensive to implement in smaller markets.  However there are countries comparable with those in the ECTEL grouping that have successfully implemented NP. Additionally, with the growing emphasis on NP throughout the region, it might be possible to share some of the implementation costs across the wider Caribbean. Nevertheless, it is anticipated that providers will seek to recover some of the costs from their customers through fees payable for porting numbers. Regulatory oversight might be necessary to ensure that those fees are not prohibitive, or inherently a deterrent for customers to request number transfers.

4.  ECTEL is recommending that in the first instance, NP is limited to fixed-to fixed networks and post-paid mobile-to-mobile networks. Due to the relatively small size of both of these markets in the sub region, it appears that NP is being introduced on a relatively small scale. While this conservative approach can be revised at a later date, the providers may still be expected to outlay considerable capital and effort to implement the agreed system. However, to manage costs and establish a viable business case, the providers might opt to implement a system that that satisfies the current circumstances but is not scalable to include the other markets. Further, due to the limited scope of the proposed operations, it is possible that the envisaged benefits might not be fully realised, which could delay broadening of NP into other services.

5.  Finally, under the current arrangements for assigning numbering to providers, number groups assigned to a particular provider are rarely transferred to another provider. From the number itself, a caller knows whether a call to that number will terminate on his/her network, or on a different network (with different calling rates). However, when NP is implemented, it can no longer be assumed that a particular number is assigned to “X” provider. Unless it is specifically addressed, callers might have a difficulty accepting this uncertainty, especially if there is still a sizeable difference in the rates charged for on-network and off-network calls.