Portability Act increases stiff competition for wireless companies

When communication providers for northern Michigan’s small towns and rural areas were required to respond to the FCC’s phone number portability rules early this summer, customers fared better than those in major markets which opened portability six months ago.

Companies in the Detroit, Ann Arbor and Grand Rapids markets were first mandated to allow the transfer of a number from one wireless company in the same market to another, or from a landline to a cell phone, last November. May 24 marked the porting deadline for companies servicing rural America.

The FCC reported 2.6 million phone customers switched carriers between November and April, but the process was not without difficulties and frustrations. During the first two months the act was in effect, 4,734 consumer complaints were registered, according to the FCC. By April, complaints were down to 400 monthly. Most consumer complaints pertained to alleged delays in actual porting time.

Those delays were frequently caused by communication problems between carriers. Carriers maintained different data bases and matching consumer information to support a switch either slowed an automated process or required hand entry or corrections by hand. By the time rural areas went into compliance with the new FCC rule, carriers had worked through many of the problems.

“We had six months to practice,” said ALLTEL spokesperson Larry White. “Working together we learned how to streamline and improve the process.”

He said initially the switching process involving all carriers could be thrown by small details such as whether street was abbreviated or spelled out. Validation was another trouble spot companies succeeded in overcoming.

“Carriers worked together to limit the number of items needed to provide validation items from a handful to two: an account number and tax ID number,” he said.

As a result of improvements, porting after May 24 has been processed in the timeframe expected by the FCC, no more than two and one-half hours.

“Everybody I’ve moved has moved in very short order. It’s taken about 90 minutes,” said Steve Philips, authorized ALLTEL agent and owner of CAP COM Paging and Cellular in Interlochen.

Philips said it’s been a mix of residential and business customers who have switched carriers. About half of the consumers are looking for better pricing. Others seek improved coverage and/or a larger local calling area.

“If you’re out of contract and you see a better deal, or you know a carrier in your market offers better coverage, you’re a candidate for taking a look at moving,” Philips said.

For companies, portability rules increase already stiff competition and set stakes high.

“Ultimately there are going to be winners and losers,” he said. “Time will tell who will be the carrier to emerge from this with the most net activations. There are going to be carriers that are going to lose customer base and market share and carriers who will gain.”

The May deadline affects 70 million Americans. Carriers successful in using the opportunity to increase market share will have greater capital to invest in their system to further increase coverage, giving them a stronger lead in the market, Philips said.

A number of smaller carriers asked for LNP waivers from state regulators requesting more time to comply, including the Traverse City-based NPI Wireless. Until mid-June when its assets were sold to Dobson Communications Corp., NPI served 38,000 wireless phone subscribers in 38 northern Michigan counties from north of Saginaw and Grand Rapids to the Soo. Dobson operates in the region under the name Cellular One. Doing business in 16 states, it is considered one of the largest rural providers in the nation.

Company public relations manager Craig Davis said the provider has not experienced a high volume of switching and that although it represents a good opportunity for customers to explore service options available to them, it didn’t spawn aggressive levels of customer outreach programs at his company.

“Customer retention and customer satisfaction is not something we work on just because of LNP,” he said. “We work really hard to ensure our customers are satisfied all of the time.”

However, the company is promoting a $100 credit incentive to pique customer interest, and is hoping to raise consumer awareness of its Global System for Mobile Communications (GSM) services. The wireless platform allows for instant messaging, web browsing, email, text messaging and digital photography.

If you are considering switching companies under the local number portability act, visit the FCC web site at www.fcc.gov/cgb/NumberPortability/.