Column: Telcos drag their heels

by Mathew on September 16, 2005

Here’s a column I posted at globeandmail.com about number portability:

“It’s a simple enough request, at least from a consumer’s point of view. You’re planning to switch from using Rogers as a cellphone service provider to Bell, or from Bell to Telus, and naturally you would like to keep your phone number, so that all your friends and co-workers will know where to reach you. It would be easier if there was a national telephone directory for cellphone numbers, but there isn’t (that’s a story for another day). So you ask to keep your number. And what is the phone company’s reply? Oh, we can’t do that, sir. Why not, you ask? After all, they do it in lots of other countries, including the U.S. and Europe, don’t they? Maybe so — but we don’t.

After years of watching other jurisdictions get wireless number portability, the federal government stepped forward earlier this year and said that it wanted the broadcast regulator to “move expeditiously” to implement the feature. Last week, the Canadian Wireless Telecommunications Association released a position paper prepared by PricewaterhouseCoopers, grandly titled Implementation of Wireless Number Portability: Setting a New World-Class Standard, in which the wireless companies said that they would be ready to start offering portability just as soon as they could. And when might that be? In 2007.

Why the delay? After all, the U.S. has had wireless number portability since 2003, and many European countries have had it for years. Not only that, but we’ve had number portability in the regular wired phone world for years, as well as the ability to move numbers from a wired phone to a wireless one. Why is wireless portability such a time-consuming feat to engineer? There’s a simple enough answer: because the wireless telcos don’t want to offer it, and they are doing whatever they can to avoid it. Why? Because it will make it easier for users to switch providers, and that’s the last thing the telcos want.

The wireless telecom association would like you to think that it’s because the change is a technical challenge not unlike splitting the atom. According to the recent PricewaterhouseCoopers report, “as part of WNP, separation of the MIN and the MDN5 is necessary. As a consequence… with the MIN/MDN separation, there are significant GTT impacts for MDN-based capabilities.”
Industry analysts, however, find all the hand-wringing a bit hard to swallow. “We are perplexed, and more than a little ashamed of our telecom industry for this foot-dragging,” says telecom consultant Iain Grant, who noted that some of his clients have had no problem moving from a Telus wired phone to a Fido wireless phone and keeping the same phone number. “Moving your number from provider to provider isn’t as problematic as it may seem,” he says, “or, if it is problematic, the issues have been addressed and the process has been mapped.”

Not so, says Peter Barnes, president and CEO of the CWTA. He maintains that 2007 is not only reasonable but “frankly [an] aggressive schedule.” Mr. Grant, however, wonders why the industry is so quick to brag about having an inter-carrier simple messaging system before the U.S., but is “unable to master far easier, more important tasks that have more demonstrated consumer interest.”

There’s a simple answer to that one: Convincing customers to use SMS and multimedia messaging generates revenue for the carriers, and allowing number portability does the opposite; it imposes costs on the carriers, and makes it easier for you to move to someone else entirely. In most European countries, having customers switch is taken for granted, and carriers try to win new users with added features. In Canada, carriers rely on long-term contracts and a lack of portability to keep you from switching.

It’s no surprise that one of the most passionate advocates of number portability is Sir Richard Branson, the founder of Virgin Mobile, along with Virgin Airlines, Virgin Music and a host of other companies. Mr. Branson has launched a mobile phone service in Canada (which is effectively buying capacity from Bell and reselling it) but it would make it a lot more appealing if users could switch their numbers easily. Mr. Branson has taken out full-page ads calling the delay “an absolute disgrace and completely unacceptable,” and on Friday called on the government to force the wireless carriers to move faster.

The British billionaire’s interest is obvious. And it’s not surprising that his startup was excluded from the meetings when the wireless companies got together to plan their strategy, since he doesn’t own any actual facilities and therefore won’t have to bear most of the costs. As self-interested as Sir Richard might be, however, he also happens to be right. U.S. carriers dragged their feet on making the change for 5 five years — presumably we are supposed to be grateful that our carriers only want to do so for two years. But if Canadian wireless telcos had started preparing when the U.S. did, we would have wireless number portability by now. Instead, we get to watch them engage in their usual delaying tactics.”

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