MNP not to ring in price war

Written by Nikita Upadhyay | Nikita Upadhyay | Mumbai | Updated: Jan 28 2011, 05:24am hrs
Mobile number portability (MNP), that has set in across the country starting last Thursday, is unlikely to kick in another round of tariff war, but network quality and customer service will emerge as differentiating factors, industry experts feel. The aim will be to wean high revenue generating post-paid subscribers away from competition. Although post-paid subscribers comprise a mere 8-10% of the total mobile subscriber base in the country, they are attractive since they are not as price sensitive as the pre-paid ones.

Although tariff may not be a differentiating factor in the choice of operators, companies that have a strong brand proposition, superior network quality, innovative and differentiated products and services and greater quality of customer service will have an edge, says Vikas Aggarwal, senior VP, corporate sector rating, Icra. Operators have beefed up their network infrastructure in anticipation of garnering high-revenue subscribers, post MNP. High value customers are extremely wary of changing to the new lot of service providers that have limited or untested network coverage and quality. We, at Vodafone, have made considerable investments in our quality of network and customer service and are geared up with the technology to enable number portability, said Samaresh Parida, director strategy, Vodafone Essar.

Meanwhile, Idea Cellular said that key parameters that will ultimately be the deciding factors for exercising choice, post MNP, are a pan-India network offering seamless connectivity, affordable and relevant products and service offerings, accessible and humane customer care, accurate billing systems, voice clarity and zero call drops. Operators, who are likely to see the most loss of high-end subscribers, are the PSU firms (MTNL and BSNL) and CDMA operators like Reliance Communications, Tata Indicom, Sistema Shyam Teleservices, and Virgin Mobile, as well as operators with ownership of high-end corporate subscribers like Loop Mobile, said Rajiv Sharma, associate director, head-media & telecom, HSBC Securities.

While telcos like Vodafone Essar and Idea Cellular have been the front-runners in initiating MNP advertising campaigns, the Tatas are expected to join soon. Others like Airtel and Uninor have adopted a passive mode of MNP promotion, via their official website. MNP may force operators to think segmentation in the pre-paid market too. Even within this market, there are customers who are both higher value as well as more loyal to their number identity,said Rajiv Bawa, EVP, corporate affairs, Uninor.