Mobile Number Portability (MNP) schemes have been slow to take off in Sub-Saharan Africa and their performance has not been outstanding.<\/p>\n
Ghana is the exception and has good reason to be bragging about its success.<\/p>\n
Russell Southwood spoke to Bob Palitz, a telecom consultant who has been involved in the MNP process from its policy and planning stages through to implementation and launch.<\/p>\n
Ghana\u2019s MNP scheme was launched on 7 July 2011 and this week the Ghanaian regulator NCA issued its 3-year report on how it has worked. The stats provided are fairly compelling:<\/p>\n
It\u2019s tempting to write the story as one of winners and losers and the process has had its heaviest impact on the largest of the incumbent mobile operators, MTN.<\/p>\n
It has lost 402,244 subscribers over the three years, a net loss of -3%. The big gainers have been Tigo with 249,725 subscribers (a 6.2% gain) and Vodafone with 228,183 subscribers (a 3.4% gain).<\/p>\n
Palitz makes a number of qualifying points on these results:\u201dPeople complained about the largest network operator before MNP but there\u2019s a reason why the largest network operator is the largest operator. You can introduce MNP but you can\u2019t influence how quality and price changes because there are 6 operators.\u201d<\/p>\n
\u201cAll operators are getting customers porting in and porting out. In no case, is the movement only in one direction. So in one hypothetical scenario, you could be losing low ARPU customers and have high ARPU customers porting in\u201d.<\/p>\n
The data doesn\u2019t tell you about the profitability of customers using MNP.<\/p>\n
But after 3 years 78% of customers who ported to another operator stayed with them. The 28% who didn\u2019t often ported to another carrier before returning to their original choice or became inactive:\u201dThe average churn rate in the market is 4.5% but is only 1% among MNP users. So the MNP users are better than average in terms of loyalty.\u201d<\/p>\n
There are three other MNP schemes in Sub-Saharan Africa and they are all in its larger markets: South Africa, Kenya and Nigeria. There are a number of reasons why these schemes may not have worked as well as the Ghanaian one.<\/p>\n
South Africa launched its scheme in 2006. It has taken 7 years to reach a 5% porting rate against Ghana\u2019s 6% in three years. It chose to go the route of having the MNP company as one owned by the operators: As Palitz notes:\u201dIf it\u2019s owned by the operators, you can\u2019t take a strong stand against misbehavior and you\u2019re prone to being unduly influenced by the large operators.\u201d<\/p>\n
\u201cThe South African market is probably not competitive enough and you can see this from the complaints from Cell C against the two other operators and disputes around the interconnection issue. MNP can\u2019t be effective if there\u2019s not already a level playing field.\u201d<\/p>\n
Kenya\u2019s CCK (now CAK) launched its MNP scheme 3 months before Ghana but has thus far only ported 1,388 customers, an almost statistically insignificant 0.0044% of the user base:\u201dOn a slow day, Ghana ports more in a day than Kenya ports in an entire year.\u201d<\/p>\n
Palitz points to the existence of a dominant operator and past Presidential interference in the interconnection regime:\u201dIt\u2019s a clear case of the regulator losing the plot. The MNP scheme hadn\u2019t even had a week of testing and it didn\u2019t work. It was huge mess and it\u2019s still not fixed.\u201d<\/p>\n
Nigeria\u2019s MNP scheme is more of a puzzle as very little useful data has emerged. Over its first year, there were 115,000 customers porting which contrasts with 363,000 customers porting in the first year of the MNP scheme in Ghana. However, given Nigeria\u2019s much larger user base, it is clear that its scheme is far from successful.<\/p>\n
So what\u2019s gone wrong?:\u201dIt\u2019s hard to give a clear answer. One thing is that the porting takes 48 hours to complete. Maybe this slowness is an issue. Also you\u2019re not allowed to port again for 90 days whereas in Ghana it\u2019s only 30 days. This is just conjecture. I don\u2019t think anyone has a handle on the situation.\u201d<\/p>\n
There is no doubt that the number of MNP schemes will grow in Sub-Saharan Africa but many are subject to that classic mobile operator regulatory delaying tactic, do an economic feasibility study.<\/p>\n
But as Pailtz says:\u201dThat\u2019s just dumb. It\u2019s a consumer right and you don\u2019t subject them to economic assessment. MNP has to be fast and cheap for the consumer and if they\u2019re no functional problems, you\u2019re going to be OK.<\/p>\n
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