New Delhi: India’s 500 million mobile phone subscribers may have to wait another three months before they are given the ability to change operators while retaining their numbers.
Technology hurdle: The government is likely to extend the 31 December deadline for implementation of number portability by one quarter. Rajkumar / Mint
The department of telecommunications (DoT) has called a meeting of India’s telecom companies and mobile number portability (MNP) implementing firms Syniverse Technologies Inc. and MNP Interconnection Telecom Solutions India Pvt. Ltd on Thursday to review the project’s status.
The delay may force an extension to the ongoing tariff war that had been expected to ease off by the last quarter of the current fiscal.
According to a senior official in DoT, the government is likely to extend the 31 December deadline for implementation of MNP by one quarter. The official did not want to be identified as he is not authorized to speak to the media.
“Some of the operators have said that they are not ready,” a senior official from the Telecom Regulatory Authority of India (Trai) said on condition of anonymity.
This comes in the wake of state-owned operators Mahanagar Telephone Nigam Ltd (MTNL) and Bharat Sanchar Nigam Ltd (BSNL) writing to the government that they would not be able to implement MNP before April for a number of reasons, including lack of time to tweak the technology, tariff plans and billing, among others.
Following this, DoT set up a coordination committee with BSNL and MTNL and the two MNP implementation agencies to try and help them meet the deadline.
The service was to have been introduced by the end of the year in the most lucrative metros and so-called A category markets. The rest of India’s mobile users were to get MNP by 20 March.
Mobile subscribers will be charged a maximum Rs19 for the service and the process will take four days, according to Trai’s norms.
India, the world’s second largest telecom market and the fastest-growing one, is in the midst of a fierce tariff war as new and smaller operators seek to add subscribers by offering tariffs lower than one paisa per second.
“We see the tariffs at these levels for the next two quarters but they should be back to rational levels after the initial churn that is expected from MNP settles down,” Lenny Musatov, chief marketing officer with Sistema Shyam Teleservices Ltd, which operates the MTS brand in India, said at the launch event of the firm’s high-speed data modem MBlaze in New Delhi on 24 November.
The tariff war was sparked by Tata Teleservices Ltd, which launched a 1 paisa per second scheme in July for its GSM (short for global system for mobile communications) service, Tata DoCoMo. The move was then matched by Aircel Ltd, MTS, Vodafone Essar Ltd, Reliance Communications Ltd, BSNL and MTNL. The rate battle has spread to national and international roaming rates.
“The primary reason for the timing of the tariff war—why it is happening now—is the fact that all the new operators are launching around this time and MNP is just around the corner,” an analyst with the Mumbai-based branch of an international brokerage firm said on condition of anonymity as he is not authorized to speak to the media.
With equipment cost falling, managed services contracts are being negotiated at lower rates and most of the new operators are willing to invest to gain market share, said Kunal Bajaj, MD with strategy consulting firm BDA Connect.
“The tariff war has not seen a bottom yet given that there are still so many operators still to launch. For these operators tariff is the only weapon. But also the cash burn rate at the present levels is not very high,” Bajaj said.
Tata Teleservices, India’s sixth largest operator by subscribers, announced a pay-per-second plan for its CDMA (short for code division multiple access) brand Tata Indicom on Wednesday.
Mumbai based Loop Telecom Pvt. Ltd, formerly BPL Mobile, announced an offer that allows subscribers to make calls at 10 paise minute or 1 paisa per six seconds depending on the recharge voucher.