MNP a non-event in SA

Johannesburg, 08 Jun 2007

Mobile number portability (MNP) has seen a slower take-up than expected in SA, although a steady and consistent uptake has been reported.

This is according to Clive Fagan, GM of the Number Portability Company, who presented at the Hooked on Mobile Markinor breakfast, co-hosted with ITWeb, this morning. The event was held to present Markinor's First Annual Mobile Loyalty Survey.

According to Markinor director Heidi Brauer, the report used probability sampling that followed the selected sampling methodology and face-to-face interviews, which were conducted in metropolitan areas.

"Only contract customers were interviewed, with 1 200 interviews conducted in total, 400 per network provider," says Brauer.

Follow-up interviews were conducted with respondents who indicated they were considering switching network providers, allowing for six months since the introduction of mobile number portability. The interviews were conducted during the first half of April this year, and targeted only respondents who had indicated they were thinking of switching network providers with the introduction of mobile number portability, she adds.

Reluctance to jump

She says 473 respondents from the original sample showed a definite interest in switching network provider and, of these, 273 said they were prepared to be contacted again in the near future to be a part of a tracking study.

These 273 respondents formed the sample for this study, and 102 successful interviews were completed from this sample.

"The number of respondents who actually switched in the six months following MNP was only six," says Brauer.

The Markinor findings revealed there are several reasons for local subscribers' reluctance to jump on the MNP bandwagon. These include customers' enjoyment of the stability of their current service provider, waiting for their contracts to expire, and a large apathy factor of "I don't know".

Other significant factors were the time, effort and cost it would take to switch providers, a comfort zone factor of "rather the devil you know than the one you don't", and, surprisingly, some respondents cited wanting to retain their current mobile number as the reason.

Mirroring the world

Fagan says the reasons for slow uptake locally mirror the rest of the world. But, while there has been "no violent surge", there has been a "steady, consistent uptake", with the SA churn rate outstripping that of many other markets. However, Fagan adds that MNP has worked better in several countries, most notably Denmark, Finland, and markets such as Hong Kong, where the environment is extremely competitive, having six operators vying for seven to eight million customers.

He says the key lesson is that MNP alone is insufficient to expand end-user options and make markets more competitive. If a market is not competitive to begin with, MNP will have a limited impact. "Markets in which MNP has driven up churn are markets that already exhibited high churn rates and low subscriber loyalty. MNP just made the switching process easier."

According to Fagan, in order to be effective, MNP should not be used in a vacuum, but alongside other regulatory tools. "As a regulatory tool, MNP is also important to improve individual operator quality of service. Ultimately, the best case scenario for a marketplace is one in which end-users have the needed flexibility to migrate networks if they want to, with operators raising their overall quality of service to make switching networks an unappealing option."