The advent of number portability in Hungary that came about on May 1 has happened with more of a whimper than a bang. It takes up to 14 working days to carry out, and just a few hundred people appear to have switched service providers. A few thousand others are on the waiting list.
While many in the industry expect no major changes as a result of this new option, one operator sees it clearly as a prime opportunity to gain more ground against its more established and firmly embedded rivals. That operator is Vodafone Hungary Rt – the local subsidiary of the British Vodafone Group Plc.
The third market entrant launched services on the stroke of the millennium, six years after the former Westel – now T-Mobile Hungary Rt – and Pannon GSM Rt had gorged themselves on what was then a growing cake of mobile subscribers. So Vodafone has the greatest amount to gain from number portability.
But its executives do point out that number portability will take time to get going, and is not the easiest process.
Around half of the requests made to join or exit Vodafone Hungary are getting delayed one way or the other, as customers fail to meet the criteria laid down in Hungarian law to switch service providers, they warn. Vodafone Hungary is out to educate consumers and the industry about these legal requirements.
According to figures from Vodafone Hungary, up to last Thursday, 631 people had ported their numbers to Vodafone, with 201 moving away from that company. But the company also said it had received a total of 2,127 requests to move to Vodafone, whilst 1,112 are trying to exit.
Of those trying to come over to Vodafone, 56% have been accepted since the inception of number portability. The rest have come unstuck and are still trying to clear things with their existing providers. Of those wishing to escape Vodafone, 52% have already been cleared to go.
Why is there a 3:1 ratio of successful entrances to successful departures, compared to a 2:1 ratio of requests in to requests out? Tamás Bányai, marketing manager at Vodafone Hungary, says this is because Vodafone is quicker than its rivals at giving new subscribers SIM cards and new handsets.
In 49% of failed porting attempts, Vodafone says incomplete personal data at the donor operator was the reason for failure. That includes a lot of phones that have been registered under names other than that of the user – for example, as a result of being given as a present. The law clearly requires that the only person who can port is the formal registered owner of that number.
For a further 34% of those declined, the problem was that they had outstanding bills due for paying. Bányai says that many customers were caught out because their old operator had just sent them a bill, which had not yet arrived through the post, making the customer believe there were no outstanding bills to pay.
To avoid this problem, he has a simple piece of advice – call the customer care department of the company you’re leaving, and ask if a new bill is pending.
Vodafone is also seeking to encourage so-called “one-gate” ports. That is a system whereby the person or company wishing to change service provider only has to go to their future provider’s customer service office. The recipient operator then contacts the donor operator directly. This contrasts with a “two-gate” port, where customers have to first visit the company they are jilting, and then drop in on the new operator. Vodafone Hungary reports that 79% of its inbound porters switched through a one-gate process.
Vodafone Hungary’s rivals were more reticent about disclosing number portability statistics for this article, although T-Mobile Hungary was not shy about announcing that it signed the first such deal.
Pannon GSM has hundreds in the waiting line, and the balance of in and out has been stable, according to Communications Director Dóra Somlyai. She says number portability in itself will not revolutionize the market.
Note that we are talking here about number portability. To keep the same handset as you switch providers is another kettle of fish. If you recently bought a nice new handset – most likely heavily subsidized by your operator – you’ll have to fork out a hefty fee to your current provider in order to have it unlocked.
3G one more time
The 3G mobile bandwagon is beginning to gather momentum in Hungary after the recent announcement from the IT and Telecommunications Ministry that tenders for 3G licenses will be invited in August.
The construction of 3G mobile networks now looks like starting perhaps as early as the end of 2005. That, of course, will be much later than in most other EU countries. But that might not be such a bad thing, as it may be wise for all concerned to have gleaned information and useful experience from the mistakes made by the early innovators.
Many in the industry say that 3G, in itself, is not going to be an attractive thing to people – the services will have to be good.
If 3G users can’t get to where they want to on their phones within three clicks, they’re not likely to use the spanking new services that 3G enables, according to Luigi Gasparollo, corporate vice president of 3G solutions provider Qualcomm Inc. and managing director of Qualcomm Europe.
Gasparollo was in town a couple of weeks back to prove to the local market that 3G technology is no longer in the lab. And the visit just happened to coincide with the license announcement.
Qualcomm is behind all sorts of 3G innovations, such as the Vodafone Group’s 3G broadband internet enabling data card, which is winning rave reviews from traveling West European businessfolk. The same kind of service is coming to the Czech Republic soon, and Gasparollo expects it to make such a splash on that market that we’ll be begging for it here.
Contrary to common belief, 3G networks are not all about UMTS technology, says Gasparollo. He says there’s also CMDA, which could be a good option for the EU accession countries and others further east. It has larger cells and is easy to integrate with existing infrastructure, he explains.
Gasparollo also stresses that there’s a lot of synergy between the different 3G technology camps, which he argues are not competitors but complimentary forces. Their shared focus is to give consumers new functions, he says.
“If [phones offer the same,] just with a different design, then people won’t buy it. Just stamping 3G on a device won’t sell it ... [3G] has to be become competitive with the internet,” he says.
The success of 3G in Hungary depends how aggressive operators are in moving people away from 2G, says Gasparollo. He also cautions that, as with any new technology, it takes a year or two for things to really take off.
Sony-Ericsson’s clamshell Z1010 is that company’s first UMTS phone, and could be one of the first 3G handsets we see here (check out the pic). While we can’t go for broke with it just yet, as we’ve got no 3G coverage, the video-phone function may well catch on one day.
It’s compatible with 2G, as all phones here will have to be, so you can use them when you leave hotspots. After all, the main population centers will get 3G coverage first. It will then be rolled out across Hungary according to demand.
What’s the difference in capabilities between 3G and what we’ve got at the moment? Graeme Millar, Vodafone Hungary’s marketing director, picks an example close to many men’s hearts. While we can already download polyphonic ring tones offering electronic renditions of popular hits, 3G will allow us, he promises, to “really have Britney giving it to us one more time.”
Phone Notes is a regular BBJ column examining the latest trends in Hungary’s telecom industry. The author can be contacted at Robert.Smyth@bbj.hu
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01.06.2004