{"id":187,"date":"2007-02-05T16:07:09","date_gmt":"2007-02-05T20:07:09","guid":{"rendered":"https:\/\/freedom24.org\/rationalpost\/2007\/02\/05\/number-portability\/"},"modified":"2009-09-23T22:39:31","modified_gmt":"2009-09-24T02:39:31","slug":"number-portability-canada","status":"publish","type":"post","link":"https:\/\/freedom24.org\/rationalpost\/number-portability-canada\/","title":{"rendered":"number portability"},"content":{"rendered":"

One of the last developed countries to modernize competition in the red hot mobile sector, Canadian regulators have finally bent to the will of their constituents<\/a> and — as of March 14, 2007 — will force incumbent cellphone operators to allow customers to switch service providers without <\/em>losing their existing number. While that might not seem like such a dramatic shift in domestic policy on its surface, the move has been years in the making, though surprisingly, the changes have come with surprisingly little industry fanfare<\/a>.<\/p>\n

\"iphone\"Within the more vocal activist community, advocates of Wireless Number Porting (or WNP) insist that such libertarian legislation benefits consumers<\/a>, operators<\/a>, and regulators<\/a>. Critics, however, are quick to point out the material cost<\/a> of technology needed to facilitate the new program, and the “churn” — or subscriber erosion — that will inevitably take place among the reigning oligopolistic operators. They also cite numerous examples of failed campaigns to liberate phone numbers from the clutches of bandwidth-hungry carriers, and the billions of dollars that have already been invested in spreading coverage across the world’s second-largest land mass.<\/p>\n

One benefit of our technological tardiness is that we now have the benefit of examining how other WNP programs have been rolled out around the globe<\/a>, and how successful or disruptive they’ve been for the various mobile stakeholders. The cost, however, is that we’re still one of the least-saturated cellular markets in the developed world, though all that might begin to change as Canadian markets open up to competition — and subsequently — technological innovation<\/a>.<\/p>\n

Case studies have shown that consumer uptake of portability initiatives in places like the Netherlands and the UK — themselves early adopters of WNP — was initially quite weak. The reasons cited included: 1) delays in porting numbers of up to 12 weeks, 2) technical glitches in the actual rollover, and 3) hefty service fees for switching. Combined, these factors dissuaded more than 95% of consumers from actually jumping ship. In contrast, and perhaps as one might expect, the American experience was considerably more strategic and consumer-friendly. Interested customers in the U.S. were promised portability within 30 to 120 minutes, fixed-line numbers were included in the portability legislation, the rollover was completely automated, and the request to port was honoured by carriers on both sides of the exchange.<\/p>\n

The reason for this difference is simple, and was highlighted in a 2003 strategic report by KPMG<\/a>:<\/p>\n

When wireless local number portability (WLNP) went into effect in the
\nUnited States in November 2003, carriers already faced huge compliance
\ncosts. Even more importantly, they\u00e2\u20ac\u2122re likely to face potentially devastating
\nrevenue volatility as newly liberated customers shop for better
\nwireless deals\u00e2\u20ac\u201dtaking their phone numbers with them.<\/p>\n

WLNP will thus trigger a new and ferocious battle for customers in the
\nwireless world that will be fought not only through retail outlets, call
\ncenters, and customer service but also through back-office operations
\nand technology.<\/p>\n

The winning wireless carriers will be the ones that view WLNP not
\nmerely as a compliance challenge but as a strategic opportunity\u00e2\u20ac\u201d
\nadmittedly with extremely high stakes\u00e2\u20ac\u201dto expand market share.<\/p><\/blockquote>\n

\"numberThus, WNP simply represents another battlefield upon which the war for control of the wireless market can be waged. Customers benefit from lower cost or higher quality service because carriers are forced to fight that much harder to both win new business and retain existing clientele. Regulators benefit because the wireless spectrum should become less volatile. And well-positioned operators benefit from the chance to acquire disgruntled customers from less customer-service, cost-competitive, and quality-oriented peers.<\/p>\n

Here in Canada, corporate receptivity has been polarized, with market-leader Rogers worried about erosion of its profit margins and predatory Telus looking forward to any opportunity<\/a> to steal market share away from its larger competitor. Another point of consideration is the strategic positioning of the three major incumbents given their underlying technologies<\/a>, with Bell and Telus competing for CDMA customers while Rogers enjoys monopolistic control over GSM (i.e. “world-friendly”) technology in the maturing Canadian marketplace.<\/p>\n

Rogers also seems poised to compete for new business on the basis of exclusive phone distribution, with rumours already circulating about the carrier becoing the sole Canadian retailer of Apple’s new and much-hyped iPhone<\/a>, mere days after the new portability legislation takes effect. Better still, Canadian consumers — who represent the second lowest rate of wireless adoption among OECD-member countries — will be introduced to a slate of new wireless providers<\/a> who hope to entice both the two-thirds of Canadians who might be disgruntled with their current service provider and the remaining third who have yet to buy their first cellular phone.<\/p>\n

\"numberMore than half-way through the decade, the move to WMP in Canada might be too little to inject new competition into key market segments like business-friendly GSM<\/a>, and too late<\/a> to pull the country toward the lucrative bleeding edge of mobile technology. But for anyone tired of extortionary long distance charges, esoteric system access fees, and “new” phones that debuted in Asia and Europe years ago, this Ides of March might bring about precisely the change they’ve been looking for.<\/p>\n","protected":false},"excerpt":{"rendered":"

One of the last developed countries to modernize competition in the red hot mobile sector, Canadian regulators have finally bent to the will of their constituents and — as of March 14, 2007 — will force incumbent cellphone operators to allow customers to switch service providers without losing their existing number. 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