Telcordia: Number Portability Allows New Market Entrants

Implementing number portability (NP) could be an added incentive for telecoms operators to enter new markets in Latin America by allowing them to compete for other companies' subscribers, according to an executive with US software solutions provider Telcordia Technologies.

Due to the high investment cost of concession licenses and bandwidth space, companies need to know that their entry into the market will garner new clients including those already on an incumbent or competitor's network, Telcordia's industry information solutions VP Chris Drake told BNamericas.

Number portability could be the added incentive they need.

The business sector will benefit directly from NP, though consumers can benefit indirectly from increased competition among operators, which will need to fight harder to retain customers. However, the business sector is much more tied to a particular phone number and can lose clients if changed.

"[The business sector's] bloodline is being reached by phone to take orders and do business... though consumers benefit from leveling the competitive playing field." Drake said.

The number of people who port their numbers is not necessarily the best way to measure benefit, rather the improvement of quality, pricing and innovation in the sector, Drake said.

Drake understands why some operators would object to NP, arguing that it will mean a shift to more focus on marketing, rather than infrastructure improvements. However, while NP does mean an added emphasis on marketing, much of the market does not base their telephony decisions solely on price, but also quality of service.

Number portability has been implemented in Puerto Rico and is on the regulatory table in Brazil, Mexico, the Dominican Republic and Chile. Discussions on the subject have reached congressional levels in Peru and Colombia as well.

Telcordia has been in discussions with operators in both Mexico and Brazil, advising them on how to adapt their networks, Drake said without naming specific companies due to nondisclosure agreements. It also implemented solutions for Caribbean mobile holdings company Centennial Communications in Puerto Rico.

The implementation on average takes 6-9 months to complete, but can take longer due to political challenges usually on the part of incumbent operators, Drake added.

The executive thinks that there are no unique challenges for Latin America operators, though each country has its own specifications. However, due to the fact that NP has been implemented now in 40 countries worldwide, there is plenty of support available for the regulatory entities and companies."

Posted to the site on 24th January 2007