I am skeptic how they would take my presentation – all Asian experiences to an almost hundred percent European audience except for two gentlemen from Botswana. Developed vs. Developing world. Connected vs. Unconnected. Are the issues similar? Or is it a different scenario?

I am glad we find some common ground. Bridging last mile isn’t an issue as serious as in Asia, but ‘Cell Broadcasting’ generates an interest. A DRR professional from audience talks about their efforts to introduce the same in France, with some success. One gentleman from Botswana asks why not in Africa. He is also interested in SMS based solutions. I introduce the Sahana SMS module to him.

Other than that, the discussion focuses more on the issues technology creates, rather than ones it solves. They talk about ‘over dependence’ on technology and the problems old find using technology. “Technology is fine, but KISS” (Keep It Simple and Stupid) says one speaker.

One pleasant surprise was to find the Director General, Civil Protection, Netherlands highlighting the benefits of Cell Broadcasting in the closing session. I am not sure whether he attended Seminar F.

Download my presentation slides from here.

The reasons cited in favor of MNP were classified into advantages to subscribers and regulators. The former were benefited by an increase in choice (of packages) and the eliminated costs of having to inform third parties of a number change, while the latter saw MNP as an approach to attract new investment and generate healthy competition. Operators on the other hand, were split in their views; new entrants and operators with smaller market share were of the view that it would create fair play in the industry, but larger operators with significant market power were, unsurprisingly, against the implementation of MNP.

High implementation costs were the main reasons against number portability. Mr. John Horrocks, an MNP consultant who spoke at the Workshop, demonstrated that a basic costs-benefit analysis of the portability process showed that implementing this service in smaller countries with populations of less than 10 million was not a feasible option, as the costs outweighed the benefits significantly. Instead, he suggested a few alternatives for these countries that would make number changes easier for subscribers (e.g.: operators send free SMS to all contacts on SIM, low cost for maintaining old number in parallel, etc), and ensure quality of service and competition among operators.

Figure 1: MNP implementations by country

Source: Presentation slides, MNP Workshop, August 2007

Mr. Horrocks also talked about the results of MNP implementations and lessons learnt in the countries listed in Figure 1. The success of MNP implementation is measured by the percentage of ported numbers, and it is evident that in countries with higher mobile phone penetration, competition and awareness, porting rates are high (e.g. Hong Kong and Australia). It was interesting to note though, that in some cases where MNP was implemented successfully, it proved to be an economic failure (e.g. Ireland, Finland, Malta, etc), while the implementations in UK and Netherlands were failures in all respects.

These varied results can be attributed to a number of reasons. Hong Kong’s MNP implementation, built on an already implemented solution set in place for fixed-line services, was driven heavily by the regulator; in addition, a highly competitive market structure in a technologically-aware community, and the fact that the introduction coincided with the entry of four new operators into the market, ensured portability a success there. The Australian regulator persistently promoted number portability to the public, while maintaining porting times of less than 3 hours on average, which eventually led to the successful implementation of MNP.

On the other hand, in the Irish case where MNP implementation was a success, the lack of competition (two incumbents and one weak new entrant) proved porting to be an economic failure. The same happened in Finland, where implementation was a success, but due to the absence of minimum contract periods and the provision of high incentives to port (from one operator to another), operators started losing heavily. This resulted in the introduction of minimum contract periods which, in turn, reduced the porting rate from 40% to 10% leading to economic failure. In the UK, Oftel (regulator at the time) pushed for MNP hoping it would increase competition, but did not play a hands-on role in the implementation phase. Additionally, only one operator in the UK was in favor of portability, and these factors collectively played a large role in the resulting failure.

A number of lessons can be learnt from these situations. Mr. Horrocks explained that it was essential for both regulators and operators to be in favor of and have heavy involvement throughout the porting process. The success of MNP depended greatly on competition and awareness and therefore it was the duty of both regulator and operator to keep subscribers informed of all things related to porting. He also said that it was important for regulators to understand that MNP did not create competition, but only improved it. Furthermore, for number porting to be successful it was necessary for a clear goal to be established, with a good set of rules (technical and legal) laid down from the start of the MNP process. He also stressed that porting time (i.e. time taken to port a number from operator A to operator B) had to be minimal, ideally one day at most, to ensure a successful MNP implementation.

The Workshop also covered the technicalities involved in number porting. Various features such as the number portability database configurations (centralized, distributed and hybrid), the call/SMS routing schemes (direct and indirect), and payment mechanisms were presented over the course of three days. The use of ENUM and NGN systems to make the porting process simpler were also discussed.

In light of these technical developments, call forwarding as a low-cost solution to number portability was not seen as the most efficient way to deploy MNP, although it was implemented in Singapore. Over 10 years ago, when the Telecommunication Authority of Singapore (TAS) discussed MNP as a means to lower number switching costs for subscribers and increase competition among operators, they explored three alternatives: 1. call forwarding, 2. originating re-route, and 3. Intelligent Network (IN) solutions. While Option 2 deviated from the GSM standard and affected services such as international roaming, Option 3 was not technologically mature yet, and therefore they settled for Option 1. They did not, however, rule out the possibility of implementing Option 3 at a later date. (Read more about MNP in Singapore)

The technical specifications employed in the number portability process in Pakistan were also described in detail. Similarly, the regulatory framework (including operator rights and obligations, charging schemes, best practices, and policy implications) required for the successful implementation of MNP was communicated by members of the PTA who were engaged in the Pakistani MNP process.

The key lesson learnt from the Workshop was that there was no standard MNP solution for a country. Every solution was unique with success riding on a number of factors.

THE PHILIPPINES was the second fastest-growing market for broadband worldwide in 2006, according to a study by UK-based research and consultancy firm Ovum.

This was primarily due, however, to the fact that broadband is just taking off in the country, and Ovum said growth could be significantly higher if regulators allow more competition that would lead to cheaper services.

Greece took the top spot in the study, and the other countries in the top ten list were Indonesia, India, Ukraine, Ireland, Thailand, Vietnam, Russia and Turkey.

Total broadband growth in the Philippines from 2005 to 2006 was at 157% while Greece’s was 168%, Datamonitor affiliate Ovum said. The Philippines had 127,942 subscribers in 2005 and this number grew to 329,216 as of end-2006.
This was despite the fact that “broadband uptake has been slow in the Philippines”, which Ovum traced to costs and limits on foreign investments.

“There is no cable infrastructure in the country and the national regulator is limiting foreign investment in the network infrastructure and mass-media services,” the study noted.

The cost of broadband services in the Philippines is also expensive relative to average monthly disposable incomes of subscribers. The highest monthly fee in the Philippine market in 2006 was $96.08, with the lowest at $17.28. In comparison, the highest monthly fee available in Greece was $60.91 while the lowest was $10.31.

The high price of broadband services in the Philippines, as well as in Vietnam and Indonesia, has resulted in penetration lags in consumer broadband among these countries, Ovum said.

Digital subscriber line (DSL) was still the dominant broadband technology used in the Philippines. Cable made up only a small portion, roughly 13%, of the market.

But prospects in the next five years were upbeat as Ovum observed trials for other broadband technologies and greater competition.

“While a low starting figure is partly attributable to high growth, there is a positive outlook for the country’s broadband market,” Mr. Coham said.

The number of subscribers is expected to increase to 1.89 million by 2011 from around 127,000 in 2005 for a compounded average growth rate of 63%.

Mr. Coham told BusinessWorld that a combination of regulation and competition would bring down the cost of broadband, making it available to the mass market.

“The national regulator has to be more involved … to lower wholesale price,” he added.

The study noted that market leader Philippine Long Distance Telephone Co. (PLDT) was facing “growing competition”.

The study said PLDT had a 77% market share and Lopez-owned Bayan Telecommunications, Inc. (Bayantel) with 11%.

“We see growth in competition from other providers; we see competitive offerings from other players. At some time, PLDT and Bayantel might be forced to drop pricing to make [their services] attractive to a larger proportion for the market,” Mr. Coham said in a phone interview.

Ovum noted that PLDT is already conducting trials of another broadband technology, fiber-to-the-home (FTTH), in Metro Manila.

FTTH can enable speeds of up to 100 megabits per second (mbps) compared to the current maximum rate of 5mbps.

However, Mr. Coham said he does not expect this kind of broadband to be commercialized in the next few years.

“While these services will be limited to the high-end market, they do suggest innovation is taking place in the Philippines which, combined with a potential for wireless services … and greater competition, should lead to further broadband growth,” the study noted.

I think the talk provides the "big picture" of the necessity of telecom reforms of the type that we at LIRNEasia are involved in. If we are to go beyond simply giving people phones, to giving them "money in the pocket and hope in the heart" this big picture is essential.

_note_: For those reluctant to read Word Documents online (ie me) I’ve added the talk as HTML on the following page.