A COMPREHENSIVE PROJECT REPORT ON

ANALYSIS OF EFFECT OF MOBILE NUMBER PORTABILITY ON CONSUMERS AND SERVICE PROVIDERS

SUBMITTED TO: GLS INSTITUTE OF COMPUTER TECHNOLOGY In partial fulfilment of the requirements for the award of the degree of MASTER OF BUSENESS ADMINISTRATION In Gujarat Technological University

UNDER THE GUIDANCE OF Dr. Sharif Memon, Faculty

Prof. Prashant Pareek, Faculty

SUBMITTED BY: Parth Patel

[Enrollment No.: 117140592013]

Govind Israni
[Enrollment No.: 117140592016]

MBA SEMESTER IV

MBA SEMESTER IV

GLS INSTITUTE OF COMPUTER TECHNOLOGY MBA PROGRAMME Affiliated to Gujarat Technological University Ahmedabad

Batch 2011-2013

G.L.S. Institute Of Computer Technology (GLS-MBA)

Certificate
This is to certify that Mr. Parth Patel (117140592013) and Mr. Govind Israni

(117140592016) students of G.L.S Institute of Computer Technology (GLS-MBA) has successfully completed their Summer Project titled on Analysis of effect of Mobile Number Portability On Customers and Service Providers in partial fulfilment for the requirements of the MBA programme of Gujarat Technological University. This is their original work and has not been submitted elsewhere.

Director (Dr. Hitesh Ruparel)

Faculty Guide (Dr. Sharif Memon)

Date: Place: _______________

Students Declaration

We (Parth Patel,Govind Israni) , hereby declare that the report for Comprehensive Project entitled Analysis of effect of Mobile Number Portability on Consumers and Service Providers is a result of our own work and our indebtedness to other work publications, references, if any, have been duly acknowledged.

Place: Date:

Parth Patel Govind Israni

PREFACE
The objective of preparing the project is to comprehend in detail how Market research takes place in the industry. The project has been carried out as a part of academic activity of Comprehensive Project. Actual field knowledge is far better than the bookish knowledge. So to get the knowledge of market & market analysis is essential being a student of management. Conducting this project on market research helps us to understand the basic concept of market, market segment, research, research methodology & research tools etc. Basically this project contains the analysis of consumer perception towards mobile number portability in Ahmedabad city. We have developed the questionnaire and met several people who all have filled questionnaire which gave us data for analysis. Recently there are many players in the market of mobile service provider. So company wants to check the potential factor to grab the market in this tough competition.

ACKNOWLEDGEMENT
Through this acknowledgement, we (Parth Patel and Govind Israni) express our sincere gratitude towards all those people who have directly and indirectly helped us in the preparation of this project, which has been a real learning experience. We appreciate the co-operation of the various Respondents who showed patience while filling the questionnaire and gave their views on the industry and the thick of things of the industry information. We would like to thank our guide Dr. Sharif Memon and Prof. Prashant Pareek for giving their precious time and suggestions and mentoring us throughout the research process. We even would like to thank the support staff of the college and our college friends for helping us in our research work. Finally we would like to thank Gujarat Technological University (G.T.U) for including such valuable concept in the curriculum which actually added some value in our lives and made us know about the actual market conditions.

II

EXECUTIVE SUMMARY
True learning is born out of experience and observations. Practical experience is one of the best types of learning as this report is practical efforts which flashes throw on consumer behaviour on Mobile Number Portability of major leading players of a telecommunication sector.

Looking to the tremendous growth of the Indian telecom industry and revolutionary tools like MNP the industry is expected to flourish further. This grand project report contains analysis of the study of above presented topic it makes us to know about consumers/customers perception towards the service of mobile number portability which is our core objective as well as scope or scenario of mobile service provider within an economy.

The need of the study was to know the consumer perception about certain benefits and attributes of MNP services and reasons of change for MNP. The information collected through this will help in determining the factors that have an impact in the mind of the consumers and what the service providers need to focus in order to retain the consumers and attract them to MNP services.

The results of research are quite interesting as majority of the subscribers were not willing to change to other operators. Reference, network quality and tariff charges are some of the reason for the consumers to switch to the other service providers.

III

TABLE OF CONTENT
Sr. no. Topic Page no.

Preface Acknowledgement Executive Summary 1. Research Methodology 1.1 Objectives 1.2 Research Design 1.3 Research Methodology 1.4 Limitations 2. Literature Review 2.1 Theoretical Developments 2.2 Empirical Contributions 2.3 3. Some of the Studies Related to MNP

I II III 1 2 2 2 4 6 7 12 14 17 18 18 20 25 26 27 27 29 29 29 31
I

Introduction to Telecom Industry 3.1 History 3.2 Introduction 3.3 Emergence as a Major Player 3.4 Foreign Direct Investment (FDI)

4.

Introduction to Mobile Number Portability In India 4.1 4.2 4.3 4.4 4.5 4.6 What is MNP? History Life before MNP Introduction in India Salient Features of the MNP Technical Details

4.7 4.8 4.9 4.10 4.11 4.12 4.13 4.14 4.15 4.16 5. 6.

Impact on Service Providers Impact on Service Providers Types of MNP Mobile Number Portability Process Drawbacks Eligibility And Conditions for Porting a Mobile Number MNP in India Pros and Cons Terminologies
Service Providers Advertising Strategies using MNP MNP Statistics

32 33 34 35 36 36 37 38 40 42 45 63 64 66 68 71 73 75 77 79 82

Data Analysis and Interpretations Hypothesis and Markov Analysis 6.1 6.2 6.3 6.4 Hypothesis 1 Hypothesis 2 Hypothesis 3 Markov Analysis

7. 8. 9. 10. 11.

Key Findings Suggestions Conclusion Bibliography Annexure

II

LIST OF TABLES
Table no. Topic

Page no. 16 42 43 43 44 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62

2.1 4.1 4.2 4.3 4.4 5.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8 5.9 5.10 5.11 5.12 5.13 5.14 5.15 5.16 5.17

Some of the studies related to MNP Circle wise Teledensity Zone 1 MNP request Zone 2 MNP request Service Provider wise Wireless Market Share Analysis - Do you use a mobile phone? Analysis - Which mobile phone do you use? Analysis - Are you aware of MOBILE NUMBER PORTABILITY Analysis - Service providers that the respondents are using currently Analysis - Time duration (months) for which respondents are using service of current service provider Analysis - Have you used MOBILE NUMBER PORTABILITY (MNP) service in past? Analysis - To which service provider you switched from the older one using MNP Analysis - Retention and Churn Rate of several service providers Analysis - What are the benefits that you have got after switching to new service provider? Analysis - Select the most appropriate reason for not using MNP Analysis - Select the most appropriate reason for not using MNP Analysis Factor for switching to new mobile network service provider Analysis Rate your current mobile network service provider on different attributes.(Vodafone) Analysis Rate your current mobile network service provider on different attributes.(Airtel) Analysis - Rate your current mobile network service provider on different attributes.(Idea) Analysis - Rate your current mobile network service provider on different attributes.(Reliance) Analysis Rate your current mobile network service provider on different attributes.(Others)

LIST OF FIGURES
Figure no. Topics Page no.

4.1 5.1 5.2 5.3 5.4 5.5 5.6

Country-wise Introduction of MNP Analysis - Do you use a mobile phone? Analysis - Which mobile phone do you use? Analysis - Are you aware of MOBILE NUMBER PORTABILITY (MNP)? Analysis - Service providers that the respondents are using currently Analysis - Time duration (months) for which respondents are using service of current service provider Analysis - Have you used MOBILE NUMBER PORTABILITY (MNP) service in past?

28 46 47 48 49 50 51

5.7

Analysis - To which service provider you switched from the older one using MNP Analysis - What are the benefits that you have got after switching

52

53

5.8 5.9 5.10 5.11 5.12 5.13 5.14 5.15 5.16

to new service provider? Analysis - Select the most appropriate reason for not using MNP Analysis - Select the most appropriate reason for not using MNP Analysis Factor for switching to new mobile network service provider Analysis Rate your current mobile network service provider on different attributes.(Vodafone) Analysis Rate your current mobile network service provider on different attributes.(Airtel) Analysis - Rate your current mobile network service provider on different attributes.(Idea) Analysis - Rate your current mobile network service provider on different attributes.(Relaince) Analysis Rate your current mobile network service provider on different attributes.(Others) 57 58 59 60 61 54 55 56

CHAPTER 1

RESEARCH METHODOLOGY
1

1.1 OBJECTIVES To know the awareness of MNP among mobile users in Ahmedabad region. To study the effect of MNP on service providers. To know the churn and retention rate of various service providers in Ahmedabad region. To Study and analyse factors influencing consumer perception to change their service provider.

1.2 RESEACH DESIGN Type of Research: - Descriptive Research

1.3 RESEARCH METHODOLOGY 1.3.1 Primary source

Primary data is information collected by the researcher or person himself whereas secondary data is collected by others but utilized or used by the researcher. Structured Questionnaires- A questionnaire is a research instrument consisting of a series of questions and other prompts for the purpose of gathering information from respondents. Questionnaires have advantages over some other types of surveys in that they are cheap, do not require as much effort from the questioner as verbal or telephone surveys, and often have standardized answers that make it simple to compile data So our primary data collected from,

Questionnaire Interview

1.3.2 Secondary source

Secondary data is data that has already been collected and collated by somebody for some reason other than the current study. Relevant data collected from. Literature review-Information regarding past studies, new strategies were gathered from various Journals and Business Magazines and text books and World Wide Web so our secondary data is collected from, Industry publications Business Articles Business Magazines Internet Surfing Past reports Government publications

1.3.3 Target Population Mobile users in Ahmedabad region.

1.3.4 Sampling Method a) Non probability Convenient Sampling

Convenience sampling is a type of non-probability sampling which involves the sample being drawn from that part of the population which is close to hand. That is, a sample population selected because it is readily available and convenient. It may be through meeting the person or including a person in the sample when one meets them or chosen by finding them through technological means such as the internet or through phone. The researcher using such a sample cannot scientifically make generalizations about the total population from this sample because it would not be representative enough.

b) Hypothesis Hypothesis is used to test the validity of the assumption. First of all the assumption is made about the population parameter. Then sample data is collected, sample
3

statistics is produced and based on this information, it is decided how likely it is that the hypothesized population parameter is correct. In our survey we have taken following as assumption,

H0: Consumers are not satisfied regarding mobile number portability. H1: Consumers are satisfied regarding mobile number portability.
1.3.5 Sample size Approximately 200 mobile users.

1.3.6 Research Instrument Questionnaire

1.4 LIMITATIONS Every research report is subject to certain limitation. This research report is no exception to it. The following are the limitations of the project report. The area covered is only Ahmedabad and from this area covered one cannot measure the trend for whole market. Sampling type is convenient type and not targeted one; it affects the conclusion which is not 100 per cent correct and reliable. Technique used to conduct the project is structured questionnaire, which are the commonly used tool & not the reliable one especially when it is used as a single technique (without any combination). The respondents did not show any interest in answering the questionnaire. They felt that it was wastage of their time. Most of the respondents were not able to understand the English language so I need to translate the whole questionnaire in local language and then fill it. The collection of primary data is comparatively difficult and sometimes the question of non-response arises because the people may not like to disclose the information.

Respondents to whom we questioned about the service did not take the survey seriously and answered the questions just for the sake of answering.

Many mobile users have not yet used Number Portability so administering questionnaire was a difficult.

The study is limited by the time constraints as well as lack of knowledge of understanding customers descriptive responses. Lack of resources like time, mode of transportation to conduct survey.

As concept of MNP is new and unique, peoples may not be aware about service provided by MNP.

Lack of interest of respondents.

CHAPTER 2

LITERATURE REVIEW
6

Majority of information on such topic obtained from different web site in which they provided different kind of information in detail. And I also collected data from primary research done by us by the form of online survey and personal meeting through questionnaire. Also from different project which have been done by management student. So far no single theory emerged to explain competition in mobile telecommunications and to analyse possible outcomes of implementation of Mobile Number Portability. But there are advances of theory in some tightly related areas which provide the necessary framework to analyze the problem through.

The structure of this review is as follows. Recent papers that investigate the issue of MNP directly are reviewed first. Then the research that created foundation for the analysis of MNP and telecommunication is described. Also, relevant empirical methodology and interesting findings of empirical investigations are discussed.

2.1 THEORETICAL DEVELOPMENTS

So far only few theoretical papers concerned the problem of MNP implementation directly. All these papers develop from the framework of network competition, as provided by Armstrong, 1998, and Laffont et al., 1998, which are describe below, mostly by adding switching costs to the model.

Aoki and Small (2005) is the most frequently cited paper that directly investigates the effect of MNP implementation. This work gave the interpretation to MNP as a reduction in switching costs accompanied by increase in fixed and marginal costs of the firms. Their analytical investigation is focused on the MNP caused welfare change of consumers and producers. The model is not convenient for analysis of competition, because authors focus on entry of a 5 second firm to a market previously monopolized by incumbent. Authors assume positive and significant switching costs of consumers and two-part tariff pricing by both firms. They found that on a mature market MNP leads to completely different welfare outcomes, depending on relative sizes of switching costs, transportation cost and consumer valuations.
7

They also analysed introduction of MNP on a growing market by extending the originally two-period game with additional period. The findings for the growing market were more precise: MNP has no effect on incumbent and improves welfare of consumers and the entrant.

Buehler and Haucap (2004) also investigated the effect on MNP implementation on consumers welfare. Novelty of this research was consideration of the effect of MNP on level of information available to consumers. They argue that under MNP number prefix has no indicative power.

Callers are not able to distinguish between on-network and off-network phone numbers and may end up paying higher average bills. They also argue that MNP implementation will benefit entrant firm and will hurt incumbent. Buehler and Haucap (2004) concentrate on the analysis of fixed-to-mobile calls ignoring more difficult mobile-to-mobile case, which involves changes of market shares.

Shi, Chiang and Rhee (2002) found that when networks incur interconnection costs, MNP may lead to higher market concentration. Their paper was motivated by increased concentration on the Hong Kong mobile telecommunications market. They argue that if there are large on-network discounts on a market, reduced switching costs, after MNP implementation, could make on network discounts of the larger firm more attractive for consumers of the small firm and result in higher switching of the later. Shi, Chiang and Rhee (2002) do not solve the problem with new consumers on the market, but make logical conclusion that the less competitive outcome is also 6 possible, though with new consumers equilibrium market prices are expected to decrease. The paper also assumes two-part tariff pricing scheme resulting in per minute prices being equal to marginal cost of providing one minute of the service.

Here it is important to underline that most of previous researches of MNP assumed two-part tariff pricing, which lead to conclusion that variable charges equal to marginal costs. I am going to argue that usually, in mobile telecommunications variable charges are not equal to marginal costs. So, using linear pricing assumption

would

be

more

appropriate,

at

least

for

empiric

analyses

of

mobile

telecommunications industry.

From my prospective, recently emerged theoretical literature on Economics of MNP has developed from two separate streams of research in Industrial Organizations: competition in network industries and competition on markets with switching costs. So, next goes description of the literature on network competition, followed by the literature on switching costs. The former was established by two seminal works. The later has richer history and naturally receives more representation in my overview.

Armstrong (1998) was among the first to develop model of network competition with the two-way access pricing between the firms. In his model consumers did not consider choosing number of minutes to consume, but only decided on number of calls. The finding of the paper was that if, in a case of symmetric firms, interconnection costs remains unregulated the firms jointly choose it in order to maximize their profits. Besides, this is the only paper that assumes uniform pricing by the players.

Laffont, Rey and Tirole (1998a) and Laffont, Rey and Tirole (1998b) make generalization and refinement of the existing literature on network competition. The models in these two papers now are basic for most researchers of Economics of MNP.

Laffont, Rey and Tirole (1998a) developed their two-way access pricing model at the same time as Armstrong (1998). This paper refines the notion of balanced calling pattern and reciprocal access pricing. The model developed is one of competition in linear pricing between two networks on saturated market, where consumers are Hotelling-differentiated. The distinguishing feature is the way the authors modeled demand they incorporated balanced calling pattern and reciprocal access pricing in it. Modelling consumers demand in such way lately was applied in works by Shi, 2002 and Haucap, 2004.

Another stream of literature, equally important for understanding possible MNP effects, is in analysis of switching costs.
9

Wide introduction to switching costs was started from research by Klemperer (1987a, b), Klemperer (1988), Klemperer (1989), Farrell and Shapiro (1988). The authors worked with two firms two periods setup with Hotelling differentiated consumer demand. Such important issues were studied as entry to the market with switching costs, price dynamics on the market with switching costs, pricing on growing market with switching costs.

Lately, Beggs and Klemperer (1992) and Padilla (1995) set up infinitely many period models and provided analytical solutions and interpretation. These papers mostly supported previous two-period findings. Most popular two-period model of oligopoly with switching costs and generalization to infinite-horizon were developed by Klemperer (1995). The generalized to infinite horizon model shows that, on average, firms have higher incentives to exploit existing customers rather than attract new ones. The key assumption to this finding was that market growth rate cannot exceed 100% per period. The paper also provides general classification of types of switching costs. This paper argues that policymakers are to reduce switching costs, as the latter result in welfare losses: switching costs reduce product variety offered to consumer and prevent switching between products (services) by making it costly. This was the paper to stimulate talks on implementation of MNP among policymakers.

We proceed with two papers that analyzed impact of switching costs on entry decision and on price wars Klemperer (1987) and Klemperer (1989). Model developed in the former allowed to conclude that most effective entry deterrents are very low and very high customer bases. Thus, low customer base signals that incumbent may behave aggressively when entrance takes place. High base is signal that entrant will not gain any more or less significant market share. Other conclusion is that very high switching costs can encourage entry because very high switching costs signal about incumbent unwillingness to fight aggressively for new customers. The latter paper develops a four-period model of market with switching costs with an entry. The model provides intuition for why prices decrease strongly in the first after the entry period and then increase to a high level.

10

Farrell and Klemperer (2001) provided broad review and classification of all available literature and findings related to switching costs. The paper provides analysis of practically all situations where switching costs arise and do have an effect. They approached the conventionally controversial issue of whether switching costs attract or distract entry. The authors suggested that resolution would depend upon the size of the switching, costs, the scale of entry, market dynamics, and existence of economies of scale. They also analyzed the competition strategy called penetration pricing, when firm gives up present periods profits to build-up market share and receive higher profits in the future.

Where present profits are assumed to be increasing in prices, market share is decreasing in prices, and future discounted profits are increasing in market share. Therefore, the important trade-off is the one between present-period and futureperiods gains. Several later papers tried to adjust the basic switching costs models for the complications of real life. Issues studied include heterogeneity of consumers (low/high willingness to pay), non-linear pricing (two-part tariff), quality of services (coverage), self-competition (complementarily between different services profiles of the same company) etc.

Among papers that concentrate on heterogeneity of consumers by their willingness to pay and on non-linear pricing are Gabrielsen and Vagstad (2002) and Corrocher and Zirulia (2005). Each paper develops theoretical model based on previous studies and comes to useful conclusion. The former paper found that when firms use twopart tariff, oligopoly produces no dead-weight losses, and the only item affected is distribution of surplus between producers and consumers. The later paper introduces two-part tariff into model developed by Klemperer 1987 and finds convergence in market shares there is inverse relation between growth in share of market leader in the market of consumers with high willingness to pay and the share in the market of consumers with low willingness to pay.

Capuano (2002) develops a model of substitution effect between old and new customers for an operator that charges lower prices for new customers while
11

keeping prices for old customers unchanged. This paper drops assumption that firm cant charge different prices for old and new customers and thus reflects the reality of the industry better. It warns that when market matures losses from old customers shifting to a new cheaper charge profiles can destroy profits from new customers demand.

Valetti (1999) and Campo-Rembado and Sundararajan (2002) draw attention to quality issues in competition between mobile operators. The former paper used coverage as proxy for quality and the latter recognized that loss-rates is much better reflection of quality but coverage is just one of the many determinants of quality. Two-stage model of the latter paper shows that because of constraints on spectrum availability and infrastructure operators with higher market share usually provide higher quality of services.

Theory often provided contradictory results, as for example, whether firms operating on a market with switching costs will chose to rip their customer base or engage in penetration pricing. Considering MNP no work was dedicated to Mobile-to-Mobile interconnection, and also though much preparatory work was done, no model to predict impact of MNP on market competition was developed.

2.2 EMPIRICAL CONTRIBUTIONS

Naturally that number of empirical papers on the issue of the effect of MNP is smaller than that of the theoretical ones. Actually, empirical work aiming at investigation outcome of MNP on market competition and welfare was conducted by either NRAs or by consulting firms for NRAs (NERA/Smith, 1998). Other empirical papers, conducted by academicians aim at detecting switching costs and also at quantifying how switching costs decrease when MNP is introduced (Kim,2005).

Already mentioned empirical paper by NERA/Smith (1998) was the result of extensive data collection process and market research and analysis.

Representative sample of personal mobile customers as well as of business mobile customers were interviewed which allowed to estimate possible benefits of MNP
12

implementation for different welfare groups of the consumers on the market. The authors classified the benefits from MNP into 3 types. Type 1 benefits are the benefits which accrue to subscribers who maintain their mobile numbers when changing operator. Type 2 benefits the benefits from increased competitive pressure, such as efficiency improvement and price reduction. Type 3 benefits are those from avoiding of high misdialing rates, making changes to information stored in customer equipment.

Other papers estimated switching costs, with either direct or indirect method, as classified by Padilla et al., 2003.

Solid and comprehensive methodology-producing paper is Padilla et al. (2003) that classifies different approaches to measure switching costs into two groups direct and indirect methods. Direct approach measures switching costs based on consumer-level data and indirect approach, based on enterpriselevel or aggregated data. Direct method is based on random utility framework and indirect method is based on either elasticity or on prices/profit margins framework.

Among papers that employ direct method to estimate switching costs is Kim (2005), that measured the effect of MNP on consumer switching costs. The econometric method used is mixed logit. He found that number portability reduced switching costs on average by 35%.

Grzybowski (2005) uses consumer-level data for 1999-2001 and is able to measure switching costs in random utility framework via mixed logit econometric model specification, based on methodology developed Padilla et al (2003). The empirical investigation resulted in finding no significant switching costs for UK leading to conclusion that now switching costs ceased to be an issue for regulators in the UK mobile industry. Another methodology-producing paper concerning approaches to measure switching costs is Shy (2002). Striving to meet the need for estimating switching costs under data availability constraint the method was developed that allows estimating switching costs given data on process and market shares only. But several strong

13

assumptions are to be fulfilled first, there are only two firms in the market and, second, duopolists do not under-price each other.

Though number of empirical papers grows quickly still there is enormous space for investigation. Up to my knowledge no research was done on measuring the effect that MNP has on future evolution of market shares. And no empirical research was conducted so far on how MNP changes the effect of other factors that affect evolution of market shares of competitors. So, there is some space for novelty and this thesis is aiming at this.

2.3 SOME OF THE STUDIES RELATED TO MNP Sr. No. 1 Implementation of Mobile Number Portability in CEPT countries Electronic Communications Awareness of the predominant approaches to MNP Title Author Learnings

Committee (ECC report implementation and to compare updated October 2005, alternative approaches.

original: March 2003)

Mobile Number Portability

Ewan Sutherland (2006)

- Churn is good to an extent. - How MNP benefits business customers

Mobile Number Portability

Stefan Buehler, Justus Haucap (July, 2004)

-For

success

of

MNP,

termination charges have to be regulated. - The set-up costs for MNP must not be so high that they exceed the various consumer benefits.

Mobile Number Portability More

Banerjee (2009)

Reliance, Tata, and BSNL subscribers more likely to

14

Attractive To India's Postpaid Users and High Spenders: 5 MNP Effect: Not enough of a game changer! Adesh Doifode

switch.

(8th Indian

Telecom

market

December, 2010)

comprises of ~ more than 91% prepaid subscribers and already this segment is having annual churn rate from 50-70%. Hence, there will not be any big move in this segment. Though, the postpaid segment which is ~9% or less of total subscriber base in India and contributes about 20% of overall subscriber revenue would be expected to have higher churning rate as

compared to present rate of 1224%.

Mobile Portability

Number Rohan Samarajiva (2010)

Multiple

SIM

ownership

among those at Pakistan Bottom of Pyramid (BPO) increased from 13% to 23% from 2006 to 2008, countries we studied) from 2006 to 2008, despite MNP being introduced. -BOP users placed great weight on affinity- group calling plans. - They were very comfortable with changing SIMs to take advantage of coverage and price SIMs to take advantage of coverage and price

15

differentials - They were unlikely to use MNP - Also the normal rationales re business cards, letterhead, etc. do not apply

An Analysis

Empirical Kavita Saxena (May 2011) of

- Procedure of MNP is difficult to follow by many customers. -firms should concentrate more on the influencing aspects (ISD call rate, free local SMS, booster packs and call cutter cards) in customer point of view in order to utilize the services more. - Poor coverage and lack of promotion and offers was the main reason for implementing MNP.

Consumer Switching Behavior Mobile Portability towards Number

Table 2.1 Some of the studies related to MNP

16

CHAPTER 3

INTRODUCTION TO TELECOM INDUSTRY

17

3.1 HISTORY Telecom in the real sense means the transfer of information between two distant points in space. The popular meaning of telecom always involves electrical signals and as a result, people often exclude postal or any other

raw telecommunication methods from its meaning. Therefore, the history of Indian telecom can be started with the introduction of telegraph.

3.2 INTRODUCTION
The Indian postal and telecom sectors saw a slow and uneasy start. In 1850, the first experimental electric telegraph line was started between Kolkata and Diamond Harbour. In 1851, it was opened for the use of the British East India Company. The Posts and Telegraphs department occupied a small corner of the Public Works Department at that time. Subsequently, the construction of 4,000 miles (6,400 km) of telegraph lines connecting Kolkata (then Calcutta) and Peshawar in the north along

with Agra, Mumbai (then Bombay) through Sindwa Ghats, and Chennai (then Madras) in the south, as well as Ootacamund and Bangalore was started in November 1853. Dr.William O'Shaughnessy, who pioneered

the telegraph and telephone in India, belonged to the Public Works Department, and worked towards the development of telecom throughout this period. A separate department was opened in 1854 when telegraph facilities were opened to the public. In 1880, two telephone companies namely The Oriental Telephone Company Ltd. and The Anglo-Indian Telephone Company Ltd. approached the Government of India to establish telephone exchanges in India. The permission was refused on the grounds that the establishment of telephones was a Government monopoly and that the Government itself would undertake the work. On the 28th January 1882, Major E. Baring, Member of the Governor General of India's Council declared open the Telephone Exchanges in Calcutta, Bombay and Madras. The exchange in Calcutta named the "Central Exchange", was opened at third floor of the building at 7, Council House Street, with a total of 93 subscribers. Later that year, Bombay also witnessed the opening of a telephone exchange.

18

Indian telecom sector is more than 165 years old. Telecommunications was first introduced in India in 1851 when the first operational land lines were laid by the government near Kolkata (then Calcutta), although telephone services were formally introduced in India much later in 1881. Further, in 1883, telephone services were merged with the postal system. In 1947, after India attained independence, all foreign telecommunication companies were nationalised to form the Posts, Telephone and Telegraph (PTT), a body that was governed by the Ministry of Communication. The Indian telecom sector was entirely under government ownership until 1984, when the private sector was allowed in telecommunication equipment

manufacturing only. The government concretised its earlier efforts towards developing R&D in the sector by setting up an autonomous body Centre for Development of Telematics (C-DOT) in 1984 to develop state-of-the-art telecommunication technology to meet the growing needs of the Indian telecommunication network. The actual evolution of the industry started after the Government separated the Department of Post and Telegraph in 1985 by setting up the Department of Posts and the Department of Telecommunications (DoT). The entire evolution of the telecom industry can be classified into three distinct phases.

Phase I- Pre-Libralisation Era (1980-89) Phase II- Post Libralisation Era (1990-99) Phase III- Post 2000

Until the late 90s the Government of India held a monopoly on all types of communications as a result of the Telegraph Act of 1885. As mentioned earlier in the chapter, until the industry was liberalised in the early nineties, it was a heavily government-controlled and small-sized market, Government policies have played a key role in shaping the structure and size of the Telecom industry in India. As a result, the Indian telecom market is one of the most liberalised market in the world with private participation in almost all of its segments. The New Telecom Policy (NTP-99) provided the much needed impetus to the growth of this industry and set the trend for libralisation in the industry.
19

3.3 EMERGENCE AS A MAJOR PLAYER In 1975, the Department of Telecom (DoT) was separated from Indian Post & Telecommunication Accounts and Finance Service. DoT was responsible for telecom services in entire country until 1985 when Mahanagar Telephone Nigam Limited (MTNL) was carved out of DoT to run the telecom services of Delhi and Mumbai. In 1990s the telecom sector was opened up by the Government for private investment as a part of Liberalisation-Privatization-Globalization policy. Therefore, it became necessary to separate the Government's policy wing from its operations wing. The Government of India corporatized the operations wing of DoT on 1 October 2000 and named it as Bharat Sanchar Nigam Limited (BSNL). Many private operators, such as, Reliance Communications Tata Indicom Vodafone Loop Mobile Airtel Idea Docomo Uninor Aircel successfully entered the high potential Indian telecom market.

The telecom sector in India experienced a rapid growth over the past decade on account of regulatory libralisation, structural reforms and competition, making telecom one of the major catalysts in Indias growth story. However, much of this growth can be attributed to the unprecedented growth in mobile telephony as the number of mobile subscribers grew at an astounding rate from 10 million in 2002 to 392 million in 2009. Besides, the growth in the service and IT and ITeS sector also increased the prominence of the telecom industry in India. Telecom has emerged as
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a key infrastructure for economic and consumer growth because of its multiplier effect and the fact that it is beneficial to trade in other industries. The contribution of the sector to GDP has been increasing gradually (its contribution in GDP has more than doubled to 2.83% in FY07 from 1.0% in FY92). Telecom is one of the fastest-growing industries in India; on an average the industry added 8 million wireless subscribers every month in FY08. The government had set a target of 500 million telecom connections by 2010. However, according to the TRAI, the total subscriber base (wireless and wireline) in the industry crossed the 500-mn-mark and reached 509.03 mn by the end of September 2009, which took India to the second position in terms of wireless network in the world next only to China. Prior to liberalisation, the telecom sector was monopolised by the public sector and recorded marginal growth; in fact, during 1948-1998, the incremental teledensity in the country was just 1.92%. However, the introduction of NTP99 accelerated the growth of the sector and the teledensity increased from 2.33 in 1999 to 36.98 in 2009; however, much of this growth was brought about by the NTP-99 policy changes such as migration from fixed license fee to revenue sharing regime and cost-oriented telecom tariffs. From 2003 onwards the government has taken certain initiatives such as unified access licensing regime, reduced access deficit, introduction of calling party pays (CPP) and revenue sharing regime in ADC that has provided further impetus to the sector. The Indian telecom industry is characterised with intense competition, and continuous price wars. Currently, there are around a dozen telecom service providers who operate in the wired and wireless segment. The government has been periodically implementing suitable fiscal and promotional policies to boost domestic demand and to create volumes for the industry. The Indian telecom industry has immense growth potential as the teledensity in the country is just 36 as compared with 60 in the US, 102 in the UK and 58 in Canada. The wireless segment growth has played a dominant role in taking the teledensity to the current levels. In the next few years, the industry is poised to grow further; in fact, it has already entered a consolidation phase as foreign players are struggling to acquire a pie in this dynamic industry.
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3.3.1 Telephones The primary regulator of telecommunications in India is the Telecom Regulatory Authority of India (TRAI). It closely regulates all of the industries mentioned below with the exception of newspapers and the Internet service provider industry. The telecommunications industry in India is dominated by private-sector and two staterun businesses. Most companies were formed by a recent revolution and restructuring launched within a decade, directed by Ministry of Communications and IT, Department of Telecommunications and Minister of Finance. Since then, most companies

gained 2G, 3G and 4G licenses and engaged fixed-line, mobile and internet business in India. On landlines, intra-circle calls are considered local calls while inter-circle are considered long distance calls. Foreign Direct Investment policy has increased the foreign ownership cap from 49% to 74%. Currently Government is working to integrate the whole country in one telecom circle. For long distance calls, the area code prefixed with a zero is dialled first which is then followed by the number (i.e. To call Delhi, 011 would be dialled first followed by the phone number). For international calls, "00" must be dialled first followed by the country code, area code and local phone number. The country code for India is 91. Several international fibre-optic links include those to Japan, South Korea, Hong Kong, Russia, and Germany. Some major telecom operators in India include Airtel, Vodafone, Idea, Aircel, BSNL, MTNL, Reliance Communications, TATA

Teleservices, Infotel, MTS, Uninor, TATA DoCoMo, Videocon, Augere, Tikona Digital. Telephone Subscribers (Wireless and Landline): 914.59 million (October 2012) Land Lines: 33.19 million (October 2012) Cell phones: 881.40 million (October 2012) Monthly Cell phone Addition: 7.79 million (October 2012) Teledensity: 76.03 % (October 2012) Projected Teledensity: 1 billion, 84% of population by 2013 End

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3.3.2 Mobile Telephones With a subscriber base of more than 851 million, the Mobile telecommunications system in India is the second largest in the world and it was thrown open to private players in the 1990s. GSM was comfortably maintaining its position as the dominant mobile technology with 80% of the mobile subscriber market, but CDMA seemed to have stabilised its market share at 20% for the time being. By March 2010 the country had 584 million mobile subscribers, up from 350 million just 15 months earlier. The mobile market was continuing to expand at an annual rate in excess of 40% coming into 2010. The country is divided into multiple zones, called circles (roughly along state boundaries). Government and several private players run local and long distance telephone services. Competition has caused prices to drop and calls across India are one of the cheapest in the world. The rates are supposed to go down further with new measures to be taken by the Information Ministry. In September 2004, the number of mobile phone connections crossed the number of fixed-line connections and presently dwarfs the wireline segment by a ratio of around 20:1. The mobile subscriber base has grown by a factor of over a hundred and thirty, from 5 million subscribers in 2001 to over 881 million subscribers as of October 2011. India primarily follows the GSM mobile system, in the 900 MHz band. Recent operators also operate in the 1800 MHz band. The dominant players are Airtel, Reliance Infocomm, Vodafone, Idea cellular and BSNL/MTNL. There are many smaller players, with operations in only a few states. International roaming agreements exist between most operators and many foreign carriers. The government allowed Mobile number portability (MNP) which enables mobile telephone users to retain their mobile telephone numbers when changing from one mobile network operator to another. India is divided into 22 telecom circles. 3.3.3 Fixed Telephones Until the New Telecom Policy was announced in 1999, only the Government-owned BSNL and MTNL were allowed to provide land-line phone services through copper wire in India with MTNL operating in Delhi and Mumbai and BSNL servicing all other
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areas of the country. Due to the rapid growth of the cellular phone industry in India, landlines are facing stiff competition from cellular operators. This has forced land-line service providers to become more efficient and improve their quality of service. Land-line connections are now also available on demand, even in high density urban areas. India has over 35 million main line customers. 3.3.4 Internet Internet country code: .in Internet Service Providers (ISPs): 180 (2010) Internet hosts: 4,536,000 Internet users: 121 million Broadband Internet users: 13 million (October 2011)

Internet access in India is largely provided by the private sector and two state-run companies and is available in a variety of forms, using a variety of technologies, at a wide range of speeds and costs. The country has the world's fourth largest Internet users with over 121 million users (of whom 59% who only access the internet via mobile devices) as of December 2011.However, the Internet penetration in India is one of the lowest in the world and only accounts for 8.4% of the population compared to OECD (Organisation for Economic Co-operation and Development ) counties where average penetration rate is over 50%.The number of broadband Internet subscribers in India has started to become more significant, having more than doubled in the two-year period to end-2009. DSL (Digital subscriber line), whilst holding slightly more than 75% of the local broadband market, was steadily losing market share to other non-DSL broadband platforms, especially to wireless broadband platforms The growth in number of broadband connections in India has accelerated since 2006. As of October 2011, total broadband Internet connections in India had reached 13 million constituting 1.0% of the population. India has one of the lowest penetrations of broadband connectivity in the world. A number of private Internet Service Providers (ISPs) offer services in India, many with their own local loop and gateway infrastructures. BSNL and MTNL have
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continued to dominate the ISP market because of their existing massive copper infrastructure in the last-mile across the nation. An estimated 60% of Internet users were still regularly accessing the Internet via the country's more than 10,000 cybercafs. According to International Telecommunication Union, the international average broadband speed is at 5.6 Mbps, whereas in India the average speed is at 256 kbps which is the minimum speed set by TRAI. The government declared 2007 to be "the year of broadband." Four years later, Indian broadband failed to deliver download speeds of which other developed nations delivers. South Korea led the list with an average of 43 Mbit/s, followed by Japan (10.6 Mbit/s) and United States (4.6 Mbit/s). 3.4 FOREIGN DIRECT INVESTMENT (FDI) In Basic, Cellular Mobile, Paging and Value Added Service, and Global Mobile Personal Communications by Satellite, Composite FDI permitted is 74% (49% under automatic route) subject to grant of license from Department of Telecommunications subject to security and license conditions. (para 5.38.1 to 5.38.4 of consolidate FDI Policy circular 1/2010 of DIPP) FDI up to 74% (49% under automatic route) is also permitted for the following: Radio Paging Service Internet Service Providers (ISP's)

FDI up to 100% permitted in respect of the following telecom services: Infrastructure Providers providing dark fibre (IP Category I) Electronic Mail Voice Mail

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CHAPTER 4

INTRODUCTION TO MOBILE NUMBER PORTABILITY IN INDIA

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4.1 WHAT IS MNP? Mobile number portability (MNP) enables mobile telephone users to retain their mobile telephone numbers when changing from one mobile network operator to another. Number Portability will allow subscribers to change their service provider while retaining their old mobile number. Portability benefits subscribers and increases the level of competition between service providers, rewarding service providers with the best customer service, network coverage, and service quality. In short, Switch mobile phone providers and keep your existing mobile phone number using mobile number portability MNP. 4.2 HISTORY Though it was introduced as a tool to promote competition in the heavily monopolized wire line telecommunications industry, number portability became popular with the advent of mobile telephones, since in most countries different mobile operators are provided with different area codes and, without portability, changing one's operator would require changing one's number. Some operators, especially incumbent operators with large existing subscriber bases, have argued against portability on the grounds that providing this service incurs considerable overhead, while others argue that it prevents vendor lock-in and allows them to compete fairly on price and service. Due to this conflict of interest, number portability is usually mandated for all operators by telecommunications regulatory authorities.

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Figure 4.1 Country-wise Introduction of MNP Singapore mobile subscribers were one of the first in the world to enjoy mobile number portability through this Call-Forwarding solution when it was launched there in 1997. Hong Kong, the UK, and Holland followed in 1999 and now over 54 countries around the world have implemented mobile number portability So worlds first country to introduce MNP was Singapore in 1997, followed by the UK, Hong Kong and the Netherlands in 1999. As of 2003, other countries especially in Europe, require MNP. Our Study majorly focuses on to know whether the consumers want to change their current mobile service provider when they are permitted to retain the current mobile phone number that they had.

This study covers following service providers: 1. Airtel 2. Vodafone 3. Reliance 4. TATA DOCOMO 5. Idea 6. Others
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4.3 LIFE BEFORE MNP Today mobile consumers nd it hard to move from one network operator to another with a better plan, unless they are ready to forego their old mobile number and update all their contacts with the new number. The result is consumers often stick to one operator even if they are dissatised with plans or customer service. Now, with the launch of MNP, consumers can easily switch between operators offering different plans while retaining their old number. A recent survey by Aegis Consulting and Research shows that Indians have been waiting for this feature and have much to gain with the launch of MNP. 4.4 INTRODUCTION IN INDIA In 2010 MNP was arrived to few cities of the India, like "Haryana" but to security reasons government had not given the authority to launch it all over the India. After one year of consideration finally Indian Government has given the green signal to "mobile number portability" service. Arrival of Mobile Number Portability may affect the business of various service providers. The service operators who are offering poor quality service to their customers may get affected by their rivals, who are providing much better service. So, the arrival of this service has changed the way of competition and now every service providers has challenge to provide better and uninterrupted service to satisfy their customers otherwise they got switched.

4.5 SALIENT FEATURES OF THE MNP MNP facility shall be available only within a given licensed service area.

A subscriber holding a mobile number is eligible to make a porting request only after 90 days of the date of activation of his mobile connection. If a number is already ported once, the number can again be ported only after 90 days from the date of the previous porting.

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The subscriber who wishes to port his mobile number should approach the Recipient operator (the operator to whom the subscriber wants to port his number). The Subscriber may be required to pay porting charges, if any, to the Recipient Operator.

The subscriber making the porting request is required to have cleared all the bills issued prior to the date of porting request. He shall give an undertaking that he has already paid all billed dues to the Donor Operator as on the date of the request for porting and that he shall pay dues to the Donor Operator pertaining to the mobile number till its eventual porting and that he understands and agrees that in event of non-payment of any such dues to the Donor Operator, the ported mobile number shall be liable to be disconnected by the Recipient Operator.

A subscriber may withdraw his porting request within 24 hours of its submission to the Recipient Operator. However, the porting charges shall not be refundable.

The regulation envisage a maximum time period of 4 days for the completion of porting process in all licensed service areas except in the case of J&K, Assam and North East licensed service areas where the maximum time allowed is 12 days. However, efforts will be made to further reduce the porting period.

Access Providers are required to implement All Call Query method.

The Originating operator shall be responsible to route the call to correct terminating network.

According to the TRAI the introduction of MNP in India will helps in increasing competition between the service providers and acts as a catalyst for the service providers to improve their quality of service.

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Through these MNP regulations, the TRAI is laying down the basic business process framework for implementation of MNP in the country.

4.6 TECHNICAL DETAILS A significant technical aspect of MNP (Mobile Number Portability) is related to the routing of calls or mobile messages (SMS, MMS) to a number once it has been ported. There are various flavours of call routing implementation across the globe but the international and European best practice is via the use of a central database (CDB) of ported numbers. Network operator makes copies of CDB and queries it to find out which network to send a call to. This is also known as All Call Query (ACQ) and is highly efficient and scalable. Majority of the established and upcoming MNP systems across the world are based on this ACQ/CDB method of call routing. One of the very few countries to not use ACQ/CDB is the UK where calls to a number once it has been ported are still routed via the Donor network. This is also known as 'Indirect Routing' and is highly inefficient as it is wasteful of transmission and switching capacity. Because of its Donor dependent nature, Indirect Routing also means that if the Donor network develops a fault or goes out of business, the customers who have ported out of that network will lose incoming calls to their numbers. The UK telecoms regulator Of co completed its extended review of the UK MNP process on 29 November 2007 and mandated that ACQ/CDB be implemented for mobile to mobile ported calls by no later than 1 September 2009. Prior to March 2008 it took a minimum of 5 working days to port a number in the UK compared to 2 hours only in USA, as low as 20 minutes in the Republic of Ireland, 3 minutes in Australia and even a matter of seconds in New Zealand. On 17 July 2007, Ofcom released its conclusions from the review of UK MNP and mandated reduction of porting time to 2 working days with effect from 1 April 2008. On 29 November 2007, Ofcom completed its consultation on further reduction to porting time to 2 hours along with recipient led porting and mandated that near-instant (no more than 2 hours) recipient led porting be implemented by no later than 1 September 2009.

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4.7 IMPACT ON SERVICE PROVIDERS The launch of MNP in India is expected to have an impact on operators margins as they will try to retain the subscribers by offering competitive tariffs and improving QoS. The Indian telecom players already grappled with falling Average Revenue Per User (ARPUs) and offering competitive tariffs to match the competition will further put pressure on their margins. Moreover, now with MNP in place the QoS will be a major differentiator which will attract subscribers. In such a scenario, operators will now have to seriously think about their service offerings and make substantial investments to improve QoS which will put pressure on margins for a short term period. In summary, MNP will increase the churn rate that will lead to greater customer acquisition and retention costs and also put pressures on an operators margin. Another trend that is expected is that there would be a lot of traction on the corporate connections. On an individual subscriber level, India already experiences a high churn rate as around 96% of subscribers are in the pre-paid category that keep changing operators depending on the tariff structures. However, the corporate segment is a top end of the overall pricing range with a heavy usage of voice and data services and contributes substantially to the ARPU. Competitors are expected to target this segment with lucrative plans and thus incentivise bulk of corporate subscribers both under individual plans as well as corporate plans to shift. This will further impact the service providers margins. Positives: 1. Operators who are having existing pool of strong customer base will be able to retain customer by providing competitive services. 2. New telecom service providers can survive in the market by providing competitive tariffs and VAS. 3. ARPU is likely to improve as customers reduce number of active connection of several operators.

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Negatives: 1. Competition among telecom service providers is increasing. 2. Profit margins are likely to erode 3. Complex task to find out subscribers owns by operators as it can change service providers when ones found better value for money 4. Cartel in the existing operators to form synergy lead to hard game for rest of the players.

4.8 IMPACT ON SERVICE PROVIDERS Positives: 1. Subscribers would likely to have efficient services at cheapest rate. 2. Can retain one number lifetime while choosing competitive plans from other operators. 3. CDMA users can switch to GSM network providers without changing the handset, and hence subscribers need not to purchase the different handset for the different network. Negatives: 1. Fees for transfer is yet not decided as new services introduced it will cost high. 2. A subscriber is eligible to make a porting request only after 90 days of the date of activation of his mobile connection. 3. Subscribers transferring the mobile number with some balance amount, no credit transfer would be allowed to the new account. 4. Consumers allowed to change operators within their registered cir-cle only (So if you are moving to another city and want to retain your mobile number, MNP is not the answer).

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4.9 TYPES OF MNP There are basically three types of number portability. The government has defined and mandated three basic types of number portability: service provider portability (commonly referred to as Local Number Portability), location portability, and service portability. The three types may be combined to form variations on number portability services. Service provider portability. Location portability. Service portability.

Service provider portability: This is ability to a subscriber to retain within the same service area, an existing telephone number even if they change from one service provider to another. This type of portability is for the same service, i.e fixed to fixed, mobile to mobile. Different types of operator portability define as: Fixed number portability: Portability of fixed geographic numbers. Mobile Number Portability: Portability of mobile telephone numbers. Intelligent number Portability: Portability of non-geographic numbers.

Location portability: Location portability released on July 2, 1996, is the ability of users of telecommunications services to retain existing phone numbers when changing from one physical location to another. Location portability is a portability of geographic number from one location to another. Location portability can be within area, within numbering area, within charging area or anywhere.

Service portability:
Service portability is the ability of users of telecommunications services to retain existing telephone numbers when changing from one service to another service, say

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from fixed to mobile service. Till date operator portability has been implemented internationally and this is going to be implemented in India as well. Number portability can also been split into fixed number portability (FNP) and Mobile number portability (MNP). Fixed number portability allow users to switch their land line service provider without having to surrender their number while mobile number portability provide the same service to mobile counterpart. India is implementing MNP initially.

4.10 MOBILE NUMBER PORTABILITY PROCESS Contact the new mobile Service Provider to whom you want to port your mobile number. Read the eligibility and other conditions carefully. Please visit www.trai.gov.in for further details. Obtain Customer acquisition From (CAF) & Porting Form. If eligible, Obtain Unique Porting Code by sending an SMS from the mobile number you want to port to the number 1900 with text PORT followed by space followed by your 10 digit mobile number you want to port. After performing the first step you will receive a unique porting number which will help you to port your number. This UPC will have Name of operator, Telecom Circle, Six digit numbers. So it will be an alpha-numeric number. Fill up the CAF and Porting Form. Submit the duly filled Porting Form and CAF along with requisite documentary proof of the mobile service provider. If you are a post-paid subscriber, submit a paid copy of the last bill issued along with the Porting Form and CAF. Obtain new SIM card from the new service provider. Subscriber can withdraw the porting request within 24 hrs of applying.

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4.11 DRAWBACKS MNP facility is available only in given licensed service area. So if you are moving to another city MNP number will not be continued, whereas if you have the same connection number t can be retained on moving out of city. But soon that is by January 20th 2011 as per TRAI announcement MNP will be launched all over India. Customer once he shifted from one connection to another and applied for MNP, he has a locking perod for 90 days. Next connection he can change only after 90 days. So a consumer who is dissatisfied with an operator service in the first month itself is being forced to suffer for another two months. It is a complex task for telecom operators. It is an additional burden to the telecom sector. Duration between the 'break' that is disconnection of the existing telecom operator and 'make' that is new connection takes at least 2 hours. So consumer is in lack of both the connection for a period of two hours.

4.12 ELIGIBILITY AND CONDITIONS FOR PORTING A MOBILE NUMBER Subscriber is allowed to move to another mobile service provider only after 90 days of the date of the activation of that mobile connection or from the date of porting of the mobile number, whichever is applicable. Subscriber is allowed to change mobile service provider within the same service area only. If you are a Post-paid subscribers, please ensure that you have paid all the dues as per your last bill (subscriber will have to sign an undertaking in the Porting Form also). If you are Pre-paid subscriber, please note that the balance amount of talk time, if any, at the time of porting will lapse.

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4.13 MNP IN INDIA PROS AND CONS Pros:

The Mobile Number Portability (MNP) allows you to retain your existing or old mobile phone number despite switching over to yet another service operator. You enjoy the advantage of retaining your old mobile phone number without unduly worrying about the burden of using or memorizing a new number.

Despite switching over to yet another service operator, there is no any additional burden of informing it to your relatives and friends. If you are a business man or a professional like a doctor or lawyer, your customers or clients can contact you with the same old mobile phone number. Hence, despite switching over to a new service provider, you retain your customers or clients intact.

You enjoy the benefits of better service from the new operator by retaining the same old mobile phone number wherever you go or reside. Again, each service provider offers some special services that cater to the needs of its bulk customers. You have the added advantage of availing such special services from a new operator by retaining your old mobile phone number using MNP facility.

MNP plays a significant role in reducing the fierce competition that prevails between the various service providers. In fact each service provider offers various schemes of tariff and facilities to retain their existing customers and to woo the customers from other service providers. But, by availing the facility of Mobile Number Portability, many subscribers voluntarily switch over from one service provider to another. Thus it eases the burden of better service providers from wooing many subscribers to their mobile phone service. In the result, each service provider will be heavily burdened with the task of providing a better mobile phone service than the other service providers. In other words each service provider will mainly focus his attention in providing the best service to his existing customers and retain them.
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The facility of Mobile Number Portability is a boon to the countries like India and China, where the mobile phone users are in millions and their density is very high.

However, there are some disadvantages in availing the MNP facility. Cons: By switching over to a new service provider, a mobile phone subscriber loses the special services and facilities offered by the previous or old service provider once and for all.

Despite retaining the same old mobile phone number through MNP facility, it takes time to acclimatize to the operating system and features of the new service provider.

In order to avail the MNP facility, you have to keep in touch with two service providers, the old and the new. It involves a number of technical feasibilities as well clerical formalities.

By availing the MNP facility, your mobile phone number loses it specific identity associated with a particular operator. Now it is not possible to predict exactly from where a subscriber avails his mobile phone service.

Since MNP is an advanced technical facility, it is offered at a comparatively high cost. Hence, a common man may have to pay more for it.

4.14 TERMINOLOGIES

Before getting deep inside the process involved in the mobile number portability let us have a brief idea about the following terminologies, which are very often used in this context.
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i. Porting means the process of moving mobile number from one Service Provider to another Service Provider or from one mobile technology to another of the same or any other Service Provider.

ii. Donor Operator means the Service provider, to whose network the mobile number belongs at the time the subscriber makes a request for porting.

iii. Recipient Operator means the Service Provider who will be providing mobile telecommunication service to the subscriber after porting.

iv. Number Portability Database means the database maintained by each Mobile Number Portability Service provider in electronic form, holding the details of all ported mobile numbers in its zone, along with the complete history of all transactions related to the porting of such numbers.

v. Per Port Transaction charge means the charge payable by the Recipient Operator to the Mobile Number Portability Service provider for processing the porting request in respect of a mobile number.

vi. Porting charge means such charge as may be levied by a Recipient Operator from a subscriber for porting his mobile number.

vii. Local Number Portability Database means the database of all ported mobile numbers maintained by individual Service Provider. For BSNL, the SSTPs will serve this purpose.

viii. Location Routing Number means the code assigned to every Service Provider for the purpose of implementing Mobile Number Portability. These are 4 digit codes and have been assigned by DOT. They have been assigned LSA wise, Operator wise and technology wise. BSNL has been allocated 42 codes in total 21 for GSM and 21 for CDMA.

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ix. Dipping means use of query response system of the Mobile Number Portability service provider for obtaining Location Routing Number for routing a message to the called number.

x. Unique porting code means an alphanumeric code allocated, upon request, by a donor operator to its subscriber for the purpose of facilitation of porting of his mobile number;

xi. MCHA means Mobile Number Portability clearing house administrator, which is the agency responsible for maintaining the MNP database and also known as MNP service provider.

4.15 SERVICE PROVIDERS ADVERTISING STRATEGIES USING MNP Without MNP, operators were mainly able to target a limited audience who were getting a new number. Migration opportunity was smaller and ROI harder to achieve using any advertising approach including mobile advertising. With the launch of MNP, the entire population of mobile users are now open to every operator; hence demand for better advertising and marketing is a reality under MNP. It is evident that operators with better choices and offers will benet from this new reality. However; MNP also presents another unique challenge to mobile service operators in India. It presents a rst ever opportunity for consumers to churn en masse. It is interesting to see the variety of marketing approaches from operators in response. For example: Idea Cellular Ltd. ran an aggressive television campaign asking people to Get Idea. The concept behind this was to call out the differentiators that Idea was offering. Better network coverage, plans adaptable to consumer

usage; echo deletion etc. were widely advertised. Vodafone India took a more inclusive approach by welcoming everybody. With the Everybodys welcome tagline, Vodafone has taken a more condent, leadership approach relying on a friendly, likeable tone to the
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advertising. Rather than call out the product benets of using Vodafone, the Vodafone ads use elements that are eminently likable such as the children, the pug, and catchy music. Tata DoCoMo went with an aggressive mobile Twitter campaign and also initiated a hashtag campaign named switch2TataDoCoMo, which it inserted into all its tweets on MNP. A typical tweet by the company read, If ur looking to switch then ensure its to a 3G ready network, who believes in cool offers..aka us Switch2TataDoCoMo MNP. The rm also adopted an informal tone in its replies to individual tweeters, often referring to them as buddy or pal. The MNP wars were not restricted just to Twitter and TV ads. Tata DoCoMo, Idea and Airtel have all bought advertising space on Google that appears on the result pages on searches for either MNP or mobile number portability. Campaigns that promote operators and adoption via MNP live in the mobile realm; hence it is a must for mobile to be an integral marketing channel. Advertising on the mobile provides the highest form of relevance to the user. Second, it also provides the user a real understanding of requirements and tangible, personal understanding of what makes one network more different than another. Overlook mobile advertising and you pass by the most obvious and important channel for MNP messaging. If the concepts above are not compelling enough, another benet remains. The greatest advantage that mobile offers operators in an MNP world are targeting capabilities on competing operator networks and specic manufacturers and handsets. With absolutely no spillage, advertisers can reach out to the exact audience they want to reach with offers to pull them into their network. This sort of targeting is not provided by any other sort of channel and is ideally suited to the needs of operators in the MNP reality that is India today.

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4.16 MNP Statistics

4.16.1 Circle wise Overall Teledensity

Circle wise Overall Teledensity December 2012 All India Assam Bihar Madhya Pradesh UP J&K Odisha North East Rajasthan West Bengal Haryana Andhra Pradesh Gujarat Maharashtra Karnataka Kerala Punjab Himachal Pradesh Tamil Nadu Delhi Table 4.1 Circle wise Teledensity 73.34 46.50 46.53 52.23 56.20 58.41 59.70 66.53 68.31 73.19 76.72 76.88 85.19 88.75 91.26 100.76 101.92 102.76 109.64 220.00

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4.16.2 Zone wise MNP Requests December 2012 ( in Mn) Zone 1 Service Area Delhi Gujarat Himachal Pradesh Haryana Jammu & Kashmir Maharashtra Mumbai Punjab Rajasthan UP East UP West Total Zone 1 Table 4.2 Zone 1 MNP request Zone 2 Service Area Andhra Pradesh Assam Bihar Karnataka Kerala Kolkotta Madhya Pradesh North East Odisha Tamil Nadu West Bengal Total Zone 2 Total All India Table 4.3 Zone 2 MNP request No of MNP requests 7.4 0.32 1.58 9.89 3.4 1.48 4.75 0.14 1.82 4.86 2.25 37.89 80.06 No of MNP requests 2.64 6.93 0.31 2.93 0.01 6.80 2.83 2.62 7.59 4.88 4.63 42.17

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4.16.3 Service Provider wise Wireless Market Share

Service Provider wise Wireless Market Share (CMS) December 2012 Bharti Vodafone Reliance Idea BSNL Tata Aircel Uninor Sistema MTNL Videocon Loop Quadrant (HFCL) 21.03% 17.05% 13.71% 13.18% 11.56% 8.04% 7.33% 4.80% 1.72% 0.61% 0.42% 0.35% 0.20%

Table 4.4 Service Provider wise Wireless Market Share

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CHAPTER 5

DATA ANALYSIS AND INTERPRETATION

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Q1. Do you use a mobile phone? Answer Yes No of Respondents 196

No

Table 5.1 Analysis - Do you use a mobile phone?

Yes No

196

Figure 5.1 Analysis - Do you use a mobile phone?

Interpretation In this case out of 200 respondents, 196 said Yes they have mobile phone that is 98% and 4 respondent said No that is 2%. From this we can say that mobile phone have reached to every house of our country. This data also shows how big the mobile market is in INDIA.

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Q2. Which mobile phone do you use? Answer Single SIM Dual SIM Triple SIM Quadra SIM No of Respondents 156 36 3 1

Table 5.2 Analysis - Which mobile phone do you use?

180 160 140 120 100 80 60 40 20 0 Single SIM Dual SIM Triple SIM Quadra SIM

Figure 5.2 Analysis - Which mobile phone do you use? Interpretation In this case out of 196 respondent 156 were using single SIM phone that is 79.59%, 36 were using Dual SIM phone that is 18.36, 3 were using Triple SIM phone that is 1.5% and only one of them using Quadra SIM phone which is 5%. Main purpose of respondent using more than one SIM is to avail the offer given by different service provider.

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Q3. Are you aware of MOBILE NUMBER PORTABILITY (MNP)? Answer Yes No No of Respondents 181 15

Table 5.3 Analysis - Are you aware of MOBILE NUMBER PORTABILITY (MNP)?
Yes No

8%

92%

Figure 5.3 Analysis - Are you aware of MOBILE NUMBER PORTABILITY (MNP)?

Interpretation Out of 196 respondent who were using mobile phone, 181 were aware about MOBILE NUMBER PORTABILITY that is 92% and 15 respondent were not aware about MOBILE NUMBER PORTABILITY that is 8%.

48

Q4. Which service providers services you are using currently? Since how long you are using that service? Service providers that the respondents are using currently Answer Vodafone Airtel Idea Reliance Others No of Respondents 60 45 30 12 34

Table 5.4 Analysis - Service providers that the respondents are using currently

60 60 50 40 30 20 10 0 Vodafone Airtel Idea Reliance Others 12 30 34 45

Figure 5.4 Analysis - Service providers that the respondents are using currently Interpretation In this case out of 196 respondent 60 respondents were using Vodafone that is 33%, 45 respondent were using Airtel service that is 23%, 30 respondent were using Idea service that is 15.3%, 12 respondent were using reliance service that is 6.12% and 34 respondent were using other services that is Uninor Tata Docomo etc which is 17.34%. From this data we can say that Vodafone is the strong leader in Ahmedabad giving tough competition to the INDIA no one brand Airtel in GSM service.

49

Time duration (years) for which respondents are using service of current service provider Years 1 Vodafone Airtel Idea Reliance Others 5 6 5 4 10 2 8 8 3 3 8 3 12 9 10 2 7 4 18 12 7 2 5 5 8 5 3 1 3 6 5 3 1 0 1 >6 4 2 1 0 0

Table 5.5 Analysis - Time duration (months) for which respondents are using service of current service provider
20 18 16 14 12 10 8 6 4 2 0 1 2 3 4 5 6 >6

Vodafone Airtel Idea Reliance Others

Figure 5.5 Analysis - Time duration (months) for which respondents are using service of current service provider Interpretation

In this case number of respondent using Vodafone mobile service for more
than 4 year is 35. Respondent using Airtel Mobile service for more than 4 year is 22. Respondent using Idea Mobile service for more than 4 year is 12. Respondent using Reliance Mobile service for more than 4 year is 3. Respondent using Other Mobile service for more than 4 year are 9.

50

Q5. Have you used MOBILE NUMBER PORTABILITY (MNP) service in past? Answer Yes No No of Respondents 69 112

Table 5.6 Analysis - Have you used MOBILE NUMBER PORTABILITY (MNP) service in past?

69

Yes No

112

Figure 5.6 Analysis - Have you used MOBILE NUMBER PORTABILITY (MNP) service in past?

Interpretation

In this case out of 196 respondent 69 have said that they have used MOBILE
NUMBER PORTABILITY that is 38% and 112 respondent have said they have never used MOBILE NUMBER PORTABILITY that is 62%.

From the data of question no (3) it is clear that the 92 % of people are aware
of MOBILE NUMBER PORTABILITY but still only 38% have used it. It may be due to several reasons.

51

Q6. To which service provider you switched from the older one using MNP? Since how long you are using new providers services? To Vodafone Vodafone From Airtel Idea Reliance Others 51 7 6 5 9 Airtel 3 32 3 3 8 Idea 2 4 18 1 6 Reliance 1 0 1 3 3 Others 3 2 2 0 8

Table 5.7 Analysis - To which service provider you switched from the older one using MNP

9 8 7 6 5 4 3 2 1 0 Vodafone Airtel Idea Reliance Others

Vodafone Airtel Idea Reliance Others

Figure 5.7 Analysis - To which service provider you switched from the older one using MNP Interpretation In this case out of 60 customers who were currently using Vodafone, 51 preferred to remain with Vodafone. Out of 45 customers who were currently using Airtel, 32 preferred to remain with Airtel. Out of 30 customers who were currently using IDEA, 18 preferred to remain with IDEA. Out of 12 customers who were currently using Reliance, 3 preferred to remain with Reliance. Out of 34 customers who were currently using other services, 8 preferred to remain with them.
52

Retention and Churn Rate of several service provider

Mobile Network service provider Vodafone Airtel Idea Reliance Other

Retention rate

Churn rate

85% 71% 60% 33% 23%

15% 29% 40% 66% 77%

Table 5.8 Analysis - Retention and Churn Rate of several service providers

53

Q7. What are the benefits that you have got after switching to new service provider? Answer SMS Offer Free Internet Usage Low Call Charges Other No of Respondents 17 7 35 10

Table 5.9 Analysis - What are the benefits that you have got after switching to new service provider?
No of Respondents 35

17 7 10

SMS Offer

Free Internet Usage

Low Call Charges

Other

Figure 5.8 Analysis - What are the benefits that you have got after switching to new service provider? Interpretation In this case out 69 respondents who switched to new mobile service provider 17 respondents that are 24.6% have got SMS offer. 7 respondents which are 10% have got free internet offer. 35 respondents that are 49.27% have got Low call charges. 10 respondents which are 14.6% have got other offer. Clearly Network service provider uses low call charges as a tool to attract customer.

54

Q8. Select the most appropriate reason for not using MNP? (Select Anyone) Answer Satisfied with the current service provider A processing fee of switching is high Complicated process of switching The processing time is longer Other No of Respondents 71 5 24 68 13

Table 5.10 Analysis - Select the most appropriate reason for not using MNP

7%

Satisfied with the current service provider A processing fee of switching is high Complicated process of switching The processing time is longer 13% 3% Other

39% 38%

Figure 5.9 Analysis - Select the most appropriate reason for not using MNP

Interpretation In this case Out of 181 respondent who were aware about MNP 71 respondent that is 40% have said they are satisfied with their current network service provider that is why they have not used MNP. About 5 respondents that is 2.7% have said processing fee of switching is high that is why they have not used MNP. About 24 respondents that is 13.25% have said complicated process of switching because of which they have not used MNP. About 68 respondents that is 37.5 have said processing time is longer because of which they have not used MNP. About 13 respondents said other reason of not using MNP.
55

Q9. Select your preferred mobile network service. Answer Vodafone Airtel Idea BSNL Reliance Tata Docomo Others No of Respondents 31 22 16 13 10 8 10

Table 5.11 Analysis - Select the most appropriate reason for not using MNP

40 30 20 10 0

31 22 16 13 10 8 10

Figure 5.10 Analysis - Select the most appropriate reason for not using MNP Interpretation

In this case 69 respondents who have use MNP, 31 have preferred Vodafone
that is 44% of respondent. 22 have preferred Airtel that is 31.87% of respondent. 16 have preferred Idea that is 23.1% of respondent.

10 have preferred reliance that is 14.4% of respondent, 31 have preferred

other which is 44% of respondent.

Vodafone is the desired choice by most of the respondent to switch.

56

Q10. Which factor do you give more priority for switching to new mobile network service provider? (1= Most Preferred and 4= Least Preferred) Rating 1 Economic Call charges Network Quality Customer Service VAS 103 55 7 14 2 71 65 14 31 3 5 43 39 96 4 2 18 121 40

Table 5.12 Analysis Factor for switching to new mobile network service provider

Economic Call charges

Network Quality

Customer Service

VAS 121

103 71 55 7 1 14 2 65 31 14 5 3 43 39

96

40 18 2 4

Figure 5.11 Analysis - Factor for switching to new mobile network service provider Interpretation Out of 181 respondents who were aware about MNP 51% of respondent considered Economic call charges as the most important factor while switching to other network. About 35% of respondent considered Network quality as the most important factor while switching to other network. About MNP 10% of respondent considered Customer service as the most important factor while switching to other network. About MNP 4% of respondent considered VAS as the most important factor while switching to other network

57

Q11. Rate your current mobile network service provider on different attributes. Vodafone Highly Dissatisfied Customer Care Network Recharge Availability VAS 3 4 8 17 22 20 14 12 13 7 3 2 Highly Satisfied

Dissatisfied Moderate Satisfied

5 3

10 7

35 10

7 38

Table 5.13 Analysis Rate your current mobile network service provider on different attributes.
Customer Care Network Recharge Availability 35 22 20 10 7 10 14 12 7 13 7 VAS 38

17 3 2 3 4 Highly Dissatisfied 5 3 8

Dissatisfied

Moderate

Satisfied

Highly Satisfied

Figure 5.12 Analysis - Rate your current mobile network service provider on different attributes. Interpretation In this case out of 60 respondents who were using Vodafone mobile network service, network quality is the main reason why people are using it. Recharge availability is the second reason why people preferred it. Customer care is the third reason why people used Vodafone service and VAS is the least preferred reason of using Vodafone service.
58

Airtel Highly Dissatisfied Customer Care Network Recharge Availability VAS 4 5 7 7 18 9 9 15 7 9 3 3 Highly Satisfied

Dissatisfied Moderate Satisfied

5 4

12 9

15 15

10 14

Table 5.14 Analysis Rate your current mobile network service provider on different attributes.
Customer Care Network 18 15 15 12 9 7 7 3 3 4 5 5 4 9 9 10 7 9 15 14 Recharge Availability VAS

Highly Dissatisfied

Dissatisfied

Moderate

Satisfied

Highly Satisfied

Figure 5.13 Analysis - Rate your current mobile network service provider on different attributes. Interpretation In this case out of 45 respondents who were using Airtel mobile network service network quality is the main reason why people using it. Customer care is the second reason why people preferred it. Recharge availability is the third reason why people use Airtel service and VAS is the least preferred reason of using Airtel service.
59

Idea Highly Dissatisfied Customer Care Network Recharge Availability VAS 5 2 5 5 10 6 6 11 4 6 5 4 Highly Satisfied 4 5

Dissatisfied Moderate Satisfied 8 4 6 9 7 8

Table 5.15 Analysis Rate your current mobile network service provider on different attributes.
Customer Care Network Recharge Availability 11 10 9 8 7 6 5 4 2 5 4 5 5 4 6 6 5 4 6 8 VAS

Highly Dissatisfied

Dissatisfied

Moderate

Satisfied

Highly Satisfied

Figure 5.14 Analysis - Rate your current mobile network service provider on different attributes. Interpretation In this case out of 30 respondents who were using IDEA mobile network service. VAS is the main reason why people using it. Network quality is the second reason why people preferred it. Customer care is the third reason why people use IDEA service and Recharge availability is the least preferred reason of using IDEA service.

60

Reliance Highly Dissatisfied Customer Care Network Recharge Availability VAS 2 2 4 3 3 2 2 3 1 2 1 2 Highly Satisfied 1 2

Dissatisfied Moderate Satisfied 3 2 5 4 2 2

Table 5.16 Analysis Rate your current mobile network service provider on different attributes.
Customer Care 4 3 2 2 2 1 2 3 Network 5 4 3 2 2 2 2 1 3 2 1 2 Recharge Availability VAS

Highly Dissatisfied

Dissatisfied

Moderate

Satisfied

Highly Satisfied

Figure 5.15 Analysis - Rate your current mobile network service provider on different attributes.

Interpretation In this case out of 60 respondents who were using Reliance mobile network service. VAS is the main reason why people using it. Network quality is the second reason why people preferred it. Customer care is the third reason why people use Reliance service and Recharge availability is the least preferred reason of using Reliance service.

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Others Highly Dissatisfied Customer Care Network Recharge Availability VAS 4 8 9 10 15 12 3 3 3 1 7 5 Highly Satisfied 2 2

Dissatisfied Moderate Satisfied 8 9 14 13 3 5

Table 5.17 Analysis Rate your current mobile network service provider on different attributes.
Customer Care Network 14 8 5 4 8 9 9 10 5 3 3 3 2 2 3 1 15 13 12 Recharge Availibility VAS

Highly Dissatisfied

Dissatisfied

Moderate

Satisfied

Highly Satisfied

Figure 5.16 Analysis - Rate your current mobile network service provider on different attributes.

Interpretation

In this case out of 60 respondents who were using Vodafone mobile network
service network quality is the main reason why people using it. Recharge availability is the second reason why people preferred it.

Customer care is the third reason why people use Vodafone service and VAS
is the least preferred reason of using Vodafone service.

62

CHAPTER 6

HYPOTHESIS AND MARKOV ANALYSIS

63

6.1 HYPOTHESIS 1
Total No. of Customers = 200 Customers who are Aware about MNP = 181 Customers who are not Aware about MNP = 19 H0: Customers are less aware about mobile number portability. H1: Customers are more aware about mobile number portability. H0: p=0.5 H1: p>0.5

Zcal

p p pq n

Where, No. of Customers who are aware about MNP total no. of Customers P So,

Z cal

0.905 0.5 (0.5)( 0.5) 200

Z cal 11.455
Now considering the significance level is of 5%. So the tabulated value is
64

Z tab 1.96

So, our calculated value falls in the rejection area. H0 is rejected. So, Alternate hypothesis is accepted So, More Customers are aware about MNP.

65

6.2 HYPOTHESIS 2
Total No. of Customers = 200 Customers who are Aware about MNP = 181 Customers who are switching their network due to economic call charges = 103 Customers who are not switching their network due to economic call charges = 78 H0: Customers are switching their network due to economic call charges H1: Customers are not switching their network due to economic call charges H0: p=0.5 H1: p>0.5

Zcal

p p pq n

Where, Customers who are switching their network due to economic call charges Customers who are Aware about MNP P So,

Z cal

0.57 0.5 (0.5)( 0.5) 181

Z cal 1.8835
66

Now considering the significance level is of 5%. So the tabulated value is

Z tab 1.96

So, our calculated value falls in the acceptance area. H0 is accepted. So, Alternate hypothesis is rejected So, Customers are switching their network due to economic call charges.

67

6.3 HYPOTHESIS 3
H0: Type of offer given by Mobile network service provider is Independent of occupation H1: Type of offer given by Mobile network service provider is not Independent of occupation The appropriate statistical test is: Chi Square contingency test = .o1 N=9

N = Degree of freedom Observed Frequency: OFFERS SMS Offer Business Service Student Others Column total
4 2 10 1 17

Free Internet usage

2 1 4 0 7

Low Call Charges

1 15 16 3 35

Others

Row Total

0 7 2 1 10

7 25 32 5 69

Expected Frequency: OFFERS

68

SMS Offer Business Service Student Others 1.72 6.16 7.8 1.23

Free Internet usage 0.71 2.53 3.24 0.5

Low Call Charges 3.55 12.68 16.23 2.53

Others 1 3.63 4.63 0.72

O 4 2 10 1 2 1 4 0 1 15 16 3 0 7 2 1 Total

E 1.72 6.16 7.8 1.23 0.71 2.53 3.24 0.5 3.55 12.68 16.23 2.53 1 3.63 4.63 0.72

(O-E)2/E 3.02 2.8 0.62 0.04 2.34 0.9 0.18 0.5 1.83 0.42 0.00 0.08 1 3.13 1.5 0.11 18.48

69

Chi Square Calculated = 18.48 Chi Square Tabulated = 21.67

Here Our Tabulated Value is more than Calculated Value. (i.e. 21.67 > 18.48) So, H0 is accepted. So, Type of offer given by Mobile network service provider is Independent of occupation .

70

6.4 MARKOV ANALYSIS

Transition Matrix Vodafone Vodafone AIrtel Idea Reliance Others 51/60 7/45 6/30 5/12 9/34 Airtel 3/60 32/45 3/10 3/12 8/34 Idea 2/60 4/45 18/30 1/12 6/34 Reliance 1/60 0/45 1/30 3/12 3/34 Others 3/60 2/45 2/30 0/12 8/34

Vodafone Vodafone Airtel Idea Reliance Others 0.85 0.15 0.2 0.416 0.26

Airtel 0.05 0.71 0.1 0.25 0.23

Idea 0.03 0.09 0.60 0.08 0.17

Reliance 0.016 0 0.033 0.33 0.088

Others 0.05 0.044 0.066 0 0.23

Current Market Share Vodafone 0.33 Airtel 0.24 Idea 0.17 Reliance 0.066 Others 0.187

Formula

St = I P(t-1)
St = Market share after t years I = Initial Market share P = Transition Matrix

71

St = [ 0.33 0.24 0.17 0.066 0.187]

0.85 0.05 0.03 0.02 0.05 0.15 0.2 0.42 0.26 0.71 0.08 0.1 0.6 0 0.04

0.03 0.06 0

0.25 0.08 0.33

0.23 0.17 0.08 0.23

S3 = [0.362 0.260 0.212 0.0456 0.1209] Hence market share after three years will be as follows

Vodafone Airtel Idea Reliance Others

36.2% 26% 21.2% 4.56% 12.09%

72

CHAPTER 7

KEY FINDINGS
73

FINDINGS

92% of the respondents are aware about the mobile number portability. Only 8% of the surveyed people are not aware. Out of 92% who are aware about MNP, 38% of them have use MNP and rest 62% are satisfied with their current service provider. Vodafone has the maximum retention rate of 85% and minimum churn rate of 15% among all the service providers. Whereas Others which include Uninor, Tata Docomo, Aircel, BSNL, etc has the least retention rate of 23% and high Churn rate of 77%.

Those who switched their networks using MNP, 49.25% of them has got low call charges as their switching benefit and only 10% of them got free Internet data plans.

Vodafone was the most preferred network by those who used MNP to which 44% of the respondents switched and Tata Docomo was the least preferred network provider to which only 12% of them switched.

Use of MNP by several respondents was done due to high call charges provided to them by their current service provider. VAS (value added services) was the least preferred criteria for using MNP. Most of the users of MNP switched to Vodafone and Airtel for proper network coverage. Some of them switched to Idea and Reliance to attain several VAS (value added services) and rest preferred to switch to Others such as Uninor, Docomo, Aircel, BSNL, etc for Economic call charges.

74

CHAPTER 8

SUGGESTIONS
75

SUGGESTION

The industry like Idea, Reliance and BSNL should improve their promotion in such a way that consumer attract towards these services as we found that these three services has too less customer as compare to Vodafone and Airtel.

Vodafone and Airtel should continue to improve the promotion and advertising which already placed in customers mind like Vodafone zoos zoo ad and Airtel har friend zaruri hai offer.

We came to know that in Ahmedabad Vodafone gain most of the consumers with the help of MNP and service providers such as Uninor Tata Docomo BSNL lost most of them so they need to enhance their services.

The main factor which influences the consumers to switch their service provider is the network coverage because of which Reliance Idea BSNL and Uninor need to take care of it to retain their customers.

Reliance need to enhance their customer handling capabilities as their customers are not satisfies with their query handling employees in their customer care.

MNP processing time should be reduced and also the process must be much simpler as most of the customers who were not using MNP suggested these two reasons.

76

CHAPTER 9

CONCLUSION
77

CONCLUSION

The purpose of the study was to know the consumer awareness about MNP and we found that majority of the surveyed respondents were aware about it. Another purpose was to know the factors influencing customers to switch their network and we found that greed of economic call charges and use of various VAS.

Most important purpose of this research was to find retention and churn rate of various service provider and we found that Vodafone retain most of their customer and Uninor Tata Docomo had high churn rate.

With the overall data and market research we can conclude that MNP are growth drivers of the Indian telecom industry. MNP has its own impact on the industry and consumer perception regarding the same will change over a period of time as it is a new concept in the market and will take some time to be acceptable

78

CHAPTER 1

BIBLIOGRAPHY
79

Bibliography
(2013, 1 2). Retrieved from http://www.dnb.co.in: http://www.dnb.co.in/IndianTelecomIndustry/OverviewTI.asp (2013, january 2). Retrieved from http://www.dnb.co.in: http://www.dnb.co.in/News_Press.asp?pid=723 (2013, January 4). Retrieved from http://www.dot.gov.in: http://www.dot.gov.in/osp/Brochure/Brochure.htm (2013, January 5). Retrieved from http://www.indiatelecomonline.com: http://www.indiatelecomonline.com/india-telecom-subscribers-december-2012/ (2013, Feb 3). Retrieved from http://www.bgr.in: http://www.bgr.in/tag/mobile-number-portabilitystatistics-for-india/ (2013, January 24). Retrieved from http://www.mobilenumberporting.in: http://www.mobilenumberporting.in/news/latest.php (2013, Febuary 5). Retrieved from http://telecomtalk.info: http://telecomtalk.info/mnp-userexperience/ (2013, Febuary 13). Retrieved from http://numberportabilityindia.com: http://numberportabilityindia.com/RULES (2013, Febuary 12). Retrieved from http://www.mnp-india.com: http://www.mnpindia.com/trai/204-29-million-subscribers-opt-for-mnp (2013, Febuary 18). Retrieved from http://telecomtalk.info: http://telecomtalk.info/category/mobile-number-portability-mnp/ (2013, January 5). Retrieved from http://en.wikipedia.org: http://en.wikipedia.org/wiki/Mobile_number_portability (2013, Febuary 17). Retrieved from http://stakeholders.ofcom.org.uk: http://stakeholders.ofcom.org.uk/consultations/gc18_mnp/summary (2013, January 25). Retrieved from http://www.rupya.com: http://www.rupya.com/2011/01/21/mobile-number-poratability-so-did-you-change-yournumber/16281 (2013, Febuary 20). Retrieved from http://www.mnp-india.com: http://www.mnpindia.com/trai/mnp-to-safeguard-subscribers (2013, january 21). Retrieved from http://www.indiastudychannel.com: http://www.indiastudychannel.com/experts/25704-How-do-I-apply-for-Mobile-NumberPortability.aspx

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(2013, january 26). Retrieved from http://ideas.repec.org: http://ideas.repec.org/p/soz/wpaper/0303.html (2013, 2 24). Retrieved from http://articles.timesofindia.indiatimes.com: http://articles.timesofindia.indiatimes.com/2013-02-21/telecom/37220766_1_mnpregulations-mobile-number-recipient-operator (2013, Febuary 12). Retrieved from http://www.infosysblogs.com: http://www.infosysblogs.com/customer-relationshipmanagement/2011/01/mobile_number_portability_mnp.html (2013, January 21). Retrieved from http://hellboundbloggers.com: http://hellboundbloggers.com/2011/01/20/mobile-number-portability-in-india/ (2013, Febuary 17). Retrieved from http://timesofindia.indiatimes.com: http://timesofindia.indiatimes.com/tech/itslideshow/6986884.cms (2013, January 21). Retrieved from http://profit.ndtv.com: http://profit.ndtv.com/news/corporates/article-mobile-number-portability-not-much-of-ahit-293431 (2013, Febuary 13). Retrieved from http://www.rediff.com: http://www.rediff.com/business/slideshow/slide-show-1-tech-mobile-number-portability-vodafone-leads/20110504.htm (2013, Febuary 14). Retrieved from http://learntelecom.com: http://learntelecom.com/featured/how-mobile-number-portability-works-in-india (2013, Febuary 6). Retrieved from http://www.business-standard.com: http://www.businessstandard.com/article/economy-policy/trai-starts-pre-consultation-for-nationwide-mnp113022000887_1.html (2013, Febuary 4). Retrieved from http://www.moneylife.in: http://www.moneylife.in/article/howto-change-your-operator-through-mobile-number-portability/13298.html

81

CHAPTER 11

ANNEXURE
82

QUESTIONNAIRE Market Research on Effect of Mobile Number Portability on Consumer and Service Provider We student of GLS-ICT required to understand the market study on Effect of Mobile Number Portability on Consumer and Service Provider as per university guideline. I assure you that the information provided by you will be used only for academic purpose and kept confidential.

1. Do you use a mobile phone? Yes No

(If Yes then move to the Question 2, If No then thanks for your time and cooperation)

2. Which mobile phone do you use?

Single SIM Dual SIM Triple SIM Quadra SIM

3. Are you aware of MOBILE NUMBER PORTABILITY (MNP)? Yes No

(If Yes then moves to the Question 4, If No then thanks for your time and cooperation)

83

4. Which service providers services you are using currently? Since how long you are using that service?

BRAND

Currently Using

Time Duration(Years)

Vodafone Airtel Idea Reliance Other______ (Other Mention)

5. Have you used MOBILE NUMBER PORTABILITY (MNP) service in past? Yes No

(If Yes then moves on to the Q6, If No then move to Q8)

6. To which service provider you switched from the older one using MNP? Since how long you are using new providers services?

Old Service provider

New Service Provider

Duration

84

7. What are the benefits that you have got after switching to new service provider? And for how many months?

OFFERS SMS Offer Free Internet Usage Low Call Charges Other __________ (Mention)

Select

No. of Months

Remarks

(Move to Question No 10 after completing Q7)

8. Select the most appropriate reason for not using MNP? (Select Anyone)

Reason *Satisfied with the current service provider A processing fee of switching is high Complicated Process of switching The processing time is longer Other (Mention)_________________

Select

*(If you are not satisfied with the current mobile network service move to Q9 Otherwise move to Q10)

85

9. Select your preferred mobile network service?

BRAND Vodafone Airtel Idea BSNL Reliance TATA Docomo Other

Select

10. Which factor do you give more priority for switching to new mobile network service provider? (1= Most Preferred and 4= Least Preferred ) Economic call charges Network Quality GPRS Customer service VAS

11. Rate your current mobile network service provider on different attributes. Highly Dissatisfied Customer Care Network Recharge Availability VAS
86

Dissatisfied

Moderate

Satisfied

Highly Satisfied

Personal Details:-

1. Name:-_____________________________________________

2. Age:-

Less than 18 years 25 to 40 years

[ [

] ]

18 to 25 years Above 40 years

[ [

] ]

3. Gender :- Male [

Female [

4. Qualification: -_____________________________

THANK YOU FOR YOUR TIME AND COOPERATION

87