India’s marathon five-year-long wait for mobile number portability — the facility which enables a cellphone user to change his/her service provider without changing the number — is finally over, after several hurdles and postponements. At last, mobile phone users in this country can freely change their phone company without having to change their number; thus automatically gaining the upper hand in their equation with service providers. Mobile tariffs in India are already at rock bottom levels, and there is very little scope to reduce these further. So the cellphone companies, in order to retain customer loyalty and secure new business, have no option but to improve their quality of service. In this, the big telecom players enjoy a natural edge over smaller players which do not have such large networks; but irrespective of size, every service provider — big or small — will have to become more efficient and customer-friendly. Those companies in a position to offer 3G services will have a distinct advantage in attracting high-value customers to switch over. Equipment vendors also stand to benefit as they will get more business, with service providers upgrading and expanding infrastructure to improve coverage.
On the first day that portability came into operation, there was, interestingly, no rush of customers opting to switch to a new service provider. If Haryana (where MNP was first introduced in November) is any pointer of things to come, there may not be too much of a churning to worry the telecom companies. Only 0.75 per cent of subscribers switched providers in that state in this period, which is below the regular level of 3-5 per cent of subscribers who switch companies even without being able to retain their existing number. Most of them are prepaid customers — a segment estimated at 97 per cent of all mobile users in India. In the long run, MNP is expected to be an attractive option — it is estimated that at least 20 million of India’s 600 million mobile subscribers might switch in the next two years. This could mean business of at least `12,000 crores a year. The potential market size is big for good performers.
The logical next step is portability in fixed line numbers. Many people are forced to, or choose to, change residence in the same city or town, and they too should be able to retain their old number. The infrastructure is available for this, and the telecom companies should be able to provide this without too much difficulty. And hopefully it should not take another five years for this.
While mobile service is steadily getting better in urban and semi-urban areas, the department of telecom needs to pay greater attention to mobile and Internet connectivity in rural areas. We are still some time away from cent per cent connectivity, and voice penetration is higher than broadband. If e-governance is to realise its full potential, broadband Internet connectivity is vital in the remotest and most deprived parts of the country — in fact even more so than in the cities where the majority of consumers have multiple options. This will also facilitate “inclusive growth” — which is the government’s mantra. A way must be found to make personal computers and laptops more affordable and available in rural areas, along with connectivity at an affordable cost. At present, the lowest regular monthly charges are around `200. This will have to be brought down drastically. The department of telecom can play a vital role — its USO (universal service obligation) fund, which is said to have a huge surplus, can be used to spur the growth of Internet and broadband penetration in the farthest corners of rural India.