Malaysia gets number portability

Elaine Chow/Ovum
06 Jul 2007
00:00

 

This will continue post-implementation. Users can expect to be spoilt with innovative new loyalty programs, including bundling of standard services with free value-added and other services.

Other subscriber lock-in strategies could include attractive on-net tariff structures that encourage groups of users (usually friends and family) to stay with the same operator or the creation of "community-based" services such as blogs, instant messaging, chatrooms and multi-user gaming that are only available to users on the same network.

 

O2's retention strategy it introduced in 2005 in the UK was seen as a big success, with churn dropping 12% for post-paid subs and 21% for prepaid subs in 2005.

 

Early that year O2 launched a major advertising campaign, delivering the message "the longer you stay with O2, the better it gets." This strategy helped increase consumer awareness of the benefits of staying with O2. As part of this retention strategy, O2 offered handset subsidies, specific promotions, competitions and discounted packages to encourage customers to commit to new or longer contracts. 

 

If well-executed, MNP should take competition in the Malaysian mobile sector to a new level.  The success of MNP is typically gauged by the longer-term rate of porting - there is usually a sudden surge just after MNP is launched, but porting should trend toward a normalized level after a few months. A higher rate of porting is usually taken to indicate greater success of MNP.

 

However, the regulator and industry commentators will need to be careful when interpreting a lower than expected rate of porting, if indeed that is the result.  MNP could release competitive countervailing activities, resulting in a net rate of porting lower than that forecasted. 

 

This is still a good outcome for users so long as it is competition that is driving the low rate and not other factors such inefficiency in the porting process or high porting costs. The threat of porting could well be as important and effective as actual porting - that in itself should be taken as an achievement.

 

Elaine Chow is a consultant for Ovum and is based in Melbourne

 

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