What changes with Number Portability in Brazil?
The possibility of changing the operator keeping the phone number is, with no doubt, a benefit for users. What about the operators, what changes for them? Will the Churn (index of loss of clients) rise? Which operators will be damaged? Which ones will take advantage?
These questions started to be answered from 09/01/2008 on, when will start the Number Portability for fixed and mobil telephony in 8 areas in the same Long-Distance Codes in Brazil, corresponding to 9,6% of the population or around 17.5 million of clients.
A activation of portability in the lasting 59 areas of Long-Distance Codes will happen between November/2008 and March/2009, and São Paulo (11) in March/09 and Rio de Janeiro (21) in February/09.
The portability might impacts differently in cell phones and in fixed telephones. While 88% of the population uses more than one cellphone operator, this percentage reaches 52% in the fixed telephony.
Portability in cell phones
In 09/01/2008 the portability is going to be available for 10,1% of cell phones in Brazil and will involve all the operators.
Total of cell phones per operator in 8 portability areas
| Thousands | Cellphones | M. Share |
% do Total of operator |
| Vivo | 5,339 |
38.9% |
13.0% |
| Tim | 3,053 |
22.3% |
8.9% |
| Claro | 3,425 |
25.0% |
10.2% |
| Oi | 781 |
5.7% |
3.7% |
| BrT | 1,011 |
7.4% |
20.0% |
| CTBC | 39 |
0.3% |
9.5% |
| Sercomtel | 71 |
0.5% |
100.0% |
| Total 8 areas | 13.719 |
100% |
10.1% |
Vivo is a market share leader in 6 of the 8 local areas and as operator of Band A, the oldest, might suffer more pressure from the other operators.
Vivo lost market share in 2008 in 4 local areas (14, 67, 17 and 62), in the others the situation remained stable. Will this situation change with the beginning of number portability?
Portability in the fixed telephony
The impact of number portability in the fixed telephony will happen in the big cities where there are authorized to compete with concessionaires. Embratel, with the Livre and NetFone, and GVT may be the major beneficiaries by the number portability for fixed telephones, mainly among corporative clients, that have bigger revenue in comparison with residential customers.
The following table shows the evolution of fixed access in the concessionaires' service in each of the cities in 2008.
| Long-Distance Codes areas | Estate |
City |
Concessionaires |
Access* December/07 |
Access* June/08 |
| 14 | SP | Bauru | Telefonica | 92,027 |
92,567 |
| 17 | SP | São José do Rio Preto | Telefonica | 118,373 |
118,668 |
| 27 | ES | Vitória | Oi | 125,903 |
124,903 |
| 37 | MG | Divinópolis | Oi | 50,369 |
50,367 |
| 43 | PR | Londrina | Sercomtel | 151,937 |
151,629 |
| 62 | GO | Goiânia | BrT | 357,309 |
352,789 |
| 67 | MS | Campo Grande | BrT | 170,588 |
169,025 |
| 86 | PI | Teresina | Oi | 104,335 |
113,083 |
* individual access, TUP not included.
In 2008, was observed alteration only in the number of individual access in concessionaries services in Goiânia e Teresina. Will it change with the Number Portability?
Portability in the world
The number portability is already used in many countries in the world, mainly United States and Europe. The rules change in each country, mainly about prices and deadlines for changing operator, those can reach more than ₤26,85 (UK) or weeks (Holland).
In Latin America, the first country to introduce the number portability was Mexico in July/08.
The international experience has shown that, in long and medium term, portability is absorbed by operators and has less effect over churn. In short term, however, it can influence the competitive environment, mainly if the operators don't prepare themselves for this new picture.
In Japan, for example, where the number portability for cellphone was implemented in July/06, it helped Softbank to conquer the leadership in net additions, overcoming market leaders NTT DoCoMo and KDDI (more details).
Despite being available for only 9,6% of the population, monitoring the beginning of the number portability on Brazil will permit the observation the operators reaction and the impact in the market.
In front of this picture the questions are:
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