Much to the chagrin of wireless carriers, Wireless Local Number Portability (WLNP) in the USA, the ability to change mobile carriers and keep one's mobile phone number, threatens to drive churn rates higher. In-Stat/MDR estimates that one-third of U.S. wireless subscribers will churn, or decide to switch from one carrier to another, in 2002. The Federal Communications Commission (FCC) has stated that wireless carriers must implement WLNP in November 2003, giving carriers little more than a year to make the necessary network and OSS upgrades that will allow for number portability.
As number portability has driven churn rates as much as 25 to 50% higher where it has been introduced in other markets overseas, the high-tech market research firm estimates that it will have a significant effect on churn in the United States, resulting in an additional 22.2 million churning subscribers in its first full year after introduction. That churn rate will drop to 30% in the following year, as the initial flurry of number portability driven churn declines, and in further years will decline by 10% annually.
The impetus for WLNP, according to regulators, consumer advocates, and the occasional carrier, is that it will promote competition and give customers greater choice and freedom to choose the wireless telephone service they want.
According to its detractors, primarily wireless carriers, WLNP will be a burdensome and expensive drain on their resources, which will siphon money away from capital investments that would have greater benefit for all wireless users. These capital investments include network buildout and upgrades that will fill in gaps in coverage and deliver advanced services that consumers say they want.
Carriers also argue that the U.S. wireless market is already highly competitive and that no substantial barriers exist that prevent customers from choosing the wireless service that best serves their needs.'"
Posted to the site on 29th August 2002
Posted to: www.cellular-news.com/story/7459.php