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PM to flag off nationwide roll-out of MNP

January 19, 2011 18:10 IST
Prime Minister Manmohan Singh is slated to flag off the nationwide roll-out of mobile number portability on Friday, a move that will allow users to switch operators without losing their phone numbers and will force telecom providers to improve the quality of their services.

"I think it's a great step forward for the consumer, as it enhances choice and brings in more competition, because the more efficient you are as a service provider, the more likely that consumers will choose you," Telecom Minister Kapil Sibal said.

MNP services were first launched in Haryana in November last year. Nevertheless, companies like Idea Cellular and Vodafone started marketing their services to subscribers in other parts of the country that are looking at switching operators even before MNP services were rolled out.

Idea Cellular, which started the 'No idea? Get Idea' campaign to woo the subscribers of rival telcos, has also set up a toll-free line to assist customers looking to switch operators.

More operators are expected to undertake similar activities to retain their subscribers, with competition likely to heat up following the nationwide roll-out of MNP services, with telcos poaching their rivals' subscribers.

On tariffs, Sistema Shyam TeleServices (SSTL) President and Chief Executive Officer Vsevolod Rozanov, which offers services under the brand MTS, said, "I think tariffs will go down further especially if we speak about the post-paid customer base that is where we are likely to see the ARPU going down."

"In the pre-paid segment, I doubt a significant change in their tariffs or profitability," he said. However, analysts feel there might not be a huge impact on the revenues of the telecom operators.

"For the first 3 to 6 months, we might see the churn going up to 6 to 7 per cent from the current levels of about 4 per cent per month. But then it will stabilise and we don't expect much impact on revenues either," Ernst & Young (E&Y) Partner and Telecom Industry Leader Prashant Singhal said.

Singhal added that MNP is expected to be more of an urban phenomenon than a rural one. Operators also seem upbeat on MNP.

"Overall, it's a good move for the customers. It puts the service providers on their toes and will make them focus on delivering value to the consumers, giving them the power to choose," COAI said.

Agrees Aircel COO Gurdeep Singh, "We expect similar churn as normally happens. So there is no different impact (because of MNP). In fact, it's good for the subscribers."

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