Some 55 million cell phone users in Germany will be able to retain their wireless phone numbers when switching operators at the start of next month.
After four years of delays and frustration, number portability has finally arrived on the German mobile market.
Germany follows several other European countries that have introduced wireless number portability, including Italy, Norway and the U.K., but is ahead of neighbouring France, which will launch the service in June 2003.
Japan has offered number portability since 2001, while the U.S. has chosen to delay the service until next year, following a decision by the U.S. Federal Communications Commission (FCC) in July.
Wireless number portability is expected to be available in most industrialized countries by the end of 2003.
From a user’s standpoint, number portability is a great idea: no need to memorize a new number or print new business cards, when switching to a new operator that offers better tariffs or services or both.
From an operator’s standpoint, the service opens the door even wider to one of the sector’s biggest headaches, churn. With churn rates hovering between 30 per cent and 40 per cent in Europe and the United States, most operators are understandably concerned about any development that might increase that number.
Yet not all operators oppose the concept: small wireless firms see number portability as a way to expand their customer base quickly.
Germany’s tug-of-war over number portability has now ended with the country’s four GSM (Global System for Mobile Communications) operators agreeing to offer the service next month at roughly the same price. After resolving technical differences months ago, they finally agreed to allow market forces to determine the fee for switching operators. That price is around 25 euros (CDN$39).
This week Germany’s largest cell phone company, T-Mobile Deutschland GmbH, announced a number portability fee of 24.95 euros, a fee the company had been publicly discussing for months. Also this week Vodafone D2 GmbH, the second biggest operator said it will charge the same fee, which is 5 euros less than it had previously sought.
T-Mobile and Vodafone control over 70 per cent of the German mobile market.
Last week the country’s third-largest operator, E-Plus Mobilfunk GmbH & Co. KG, agreed to 24.95 euros, after lobbying intensively for a fee of around 10 euros, which it claims is the international average. And the country’s smallest GSM phone company, O2 (Germany) GmbH & Co. OHG, said it will charge 22.50 euros for the switch. Like E-Plus, O2 had also sought a much lower fee.
Telecom Italia Mobile SpA, the first in Italy to offer number portability, has levied a fee of 10 euros for prepaid customers and 5 euros for postpaid subscribers.
According to a poll published Wednesday by Mummert Consulting AG, 58 per cent of mobile phone customers in Germany want to switch operators. Their main reasons: high connection fees, expensive subscription contracts and insufficient coverage. Around 55 per cent of polled mobile users with a two-year contract said they want to change, with the percentage even higher for customers with three-year contracts.