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Mobile Number Portability: Case Finland MOBILE NUMBER PORTABILITY: CASE FINLAND Timo Smura Helsinki University of Technology Networking Laboratory P.O. Box 3000 FIN-02015 HUT, FINLAND Tel. +358-50-536 9855, Fax +358-9-451 2474 In most countries, mobile phone numbers are non- Abstract geographic in nature. They have distinct area codes making them recognizable and allowing operators to Mobile number portability (MNP) means the ability of charge the mobile terminated calls differently. In these mobile subscribers to switch between service providers countries, location portability is non-relevant from the while retaining their original mobile phone numbers. point of view of MNP. Some countries, such as the MNP removes barriers to competition by lowering the United States and Hong Kong are, however, using the switching costs of the end-users. MNP has been area codes of fixed line telephone numbers also for implemented in most of the advanced markets mobile phones. In these countries, one operator may throughout the world. have different pricing schemes for local and long- distance mobile calls within its network. Thus, one has In the European Union, the MNP regulation is based on to separate between MNP with and without location the Universal Service Directive (Directive 2002/EC/22). portability. The directive requires operators to implement fixed-to- fixed and mobile-to-mobile number portability. In some Service portability is also relevant when comparing the markets, for example in the US, also fixed-to-mobile MNP solutions in different countries. In some countries, number portability is required. In Japan, MNP is not yet the requirement for MNP also includes fixed-to-mobile required by the regulator. portability. In Finland, MNP was implemented in July 2003, having 1.2 MNP and stakeholders a strong effect on the competition on the market. Numbers of portings have far exceeded those in MNP reduces the switching costs of customers desiring experienced in other countries. Reasons for this include to switch their subscriptions from one operator to e.g. the banning of handset subsidies and long another. These switching costs include e.g. informing subscription contracts, user-friendly and free-of-charge friends and business partners about the new number, porting process, and heavy marketing campaigns of missing calls from uninformed people, and updating mobile operators. company web pages, brochures, and business cards. On the other hand, MNP makes it more difficult for the Key Words: MNP, regulation, churn customers to know which network they are calling to. Operators are no longer identified by the prefixes of the phone numbers, making it more difficult to find out the actual prices of the calls. This problem can be alleviated 1. Introduction by subscribing to a single-rate call plan, if possible. 1.1 Terminology From the network operator point of view, MNP gives rise to additional costs, related to investments to number Mobile number portability (MNP) can be defined as the portability databases and upgrading and configuring the ability of mobile subscribers to switch between service switching equipment. providers while retaining their original mobile phone numbers. MNP can be seen as an example of service From the service operator point of view, MNP makes it provider portability, one of three basic types of number easier to attract new customers - and harder to keep the portability (Table 1). existing ones. In other words, MNP increases the churn rates of service operators. Table 1: Number portability types Portability Service Service Location The rest of the paper is organized as follows. Section 2 type portability provider portability gives an overview on the status of regulation in portability different markets, and Section 3 introduces alternative Aka Operator Geographic technical solutions for the implementation of MNP. In portability portability Examples Fixed-to- Mobile-to- Fixed number Section 4, the impact of MNP in the Finnish market is mobile mobile, portability analyzed, and reasons for the exceptionally high number PSTN-to- fixed-to-fixed inside a local porting rates are discussed. Finally, Section 5 concludes ISDN exchange area the paper. 2. Regulatory status each local exchange carrier (LEC) has the duty to provide number portability, defined as “the ability of MNP has been recognized as an important driver of users of telecommunications services to retain, at the competition by regulators around the world. During the same location, existing telecommunications numbers late 1990’s and early 2000’s, MNP has been without impairment of quality, reliability, or implemented in most of the advanced markets. Figure 1 convenience when switching from one shows the MNP implementation status in Europe and in telecommunications carrier to another” (FCC 1996). selected other countries. Interestingly, in the US, the mobile phone subscriptions are not assigned any mobile specific area codes, which is the case in most countries. The mobile phone Lithuania numbers are taken from the same number space than Italy Slovakia fixed line numbers, and it is impossible to know if a Switzerland Belgium South Korea Spain Germany USA (as whole) phone number is associated with a mobile phone just by 1997 1998 1999 2000 2001 2002 2003 2004 looking at the number. Accordingly, it is only possible Singapore Hong Kong Denmark Finland to port a mobile phone number to an operator that is U.K. Sweden France serving the same geographical area as the donor Netherlands Norway Austria operator. Accordingly, the process is called Wireless Portugal Greece Local Number Portability (WLNP). Australia Ireland Iceland WLNP became available in the 100 largest markets in Luxembourg November 2003 and in the whole country in May 2004. Figure 1: MNP implementation in some countries Fixed-to-mobile portability is also required in most (Source: ECC 2003) areas, as long as the wireless operator is serving the same geographical area as the fixed line operator. 2.3 Other markets 2.1 Regulation in the European Union In Japan, MNP is not currently available. The Japanese The European Parliament and Council of Ministers th authorities have, however, stated that MNP should be adopted on 7 March 2002 four new directives dealing implemented as soon as possible, and scheduled it to with telecommunications regulation. Directive happen in 2006. (MPHPT 2004) 2002/EC/22 (Universal Service Directive) states, among other things, that In South Korea, MNP has been available since January 2004 and in Hong Kong since March 1999. Member states shall ensure that all subscribers of publicly available telephone services, including mobile services, who so request can retain their number(s) independently of the undertaking providing the service: 3. Technical solutions (a) in the case of geographic numbers, at a specific From technical point of view, the implementation of location; and number portability requires a substantial amount of work and changes in the telecommunications (b) in the case of non-geographic numbers, at any infrastructure. Typically, the implementation includes a location. number portability database and a selection of suitable routing methods for different types of calls and National regulatory authorities shall ensure that messaging services. pricing for interconnection related to the provision of number portability is cost oriented and that direct charges to subscribers, if any, do not act as a 3.1 Number portability database disincentive for the use of these facilities. The number portability database (NPDB) keeps track of the ported numbers and their respective service The requirement for number portability does not apply providers. The NPDB information is used to determine to the porting of numbers between fixed and mobile the correct terminating network for the calls and networks. (EU 2004) messages. Based on the directive, all the member countries of the The NPDB can be either centralized or distributed. In European Union were required to implement mobile the centralized model, there exists a single reference number portability by July 25, 2003. database containing data for the numbers of all service 2.2 Regulation in the United States providers. The reference database is frequently copied to service providers’ operational databases. In the In the United States, the basis for current distributed model there exist multiple databases, each telecommunications regulation was laid in the containing subsets of the total data, e.g. only the Telecommunications Act of 1996. According to the Act, numbers assigned to particular service provider. In most of the countries a centralized database is used, services along with the mobile phone number, although and typically managed by a consortium of mobile this has not been the case in all countries. From a network operators. (ECC 2003) technical point of view, SMS and MMS messages require routing mechanisms different from voice calls. 3.2 Call routing SMS messages are delivered using the signaling network (SS7), while MMS is based on the wireless The routing of calls to a mobile network associated with application protocol (WAP) running over packet or a ported mobile number can be handled in multiple circuit switched data. ways. The different methods can be divided into two broad classes: direct routing and indirect routing. A Alternative routing methods for SMS and MMS are report from the Electronic Communications Committee specified in 3GPP technical specifications (TS 23.066 (ECC 2003) lists four possible alternatives for call and TS 23.140). The routing can happen
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