Mobile Number Portability: Are we on the right track?

Nearly 18 years into telecom regulatory exercise in Bangladesh, efforts to offer mobile phone users the opportunity to switch operators while retaining their all-important phone number, have hit snags time and again. Conspiracy theorists, rightly so to a large extent, suggest foul play by the big players in the business.

Even AMTOB (Association of Mobile Telephone Operators in Bangladesh), when offered by regulators years ago, refused to take the responsibility to run the service, primarily designed to protect and serve the consumers. The latest move seems to be taking some shape.

The selection of a Number Portability Clearinghouse provider to implement Mobile Number Portability (MNP) in Bangladesh is an important step for both the industry and the consumers. It is a significant move in the evolution of the telecommunication services in terms of protecting users' interest. So the choice of a selection methodology has an added significance and is therefore a critical decision.

National projects like MNP that impact and require industry changes make it imperative that technical qualifications, experience, track record, and financial stability be given due weighting in the evaluation of bids.

Selection based on the lowest price can have disastrous national consequences and could undermine the credibility of the purchasing authority. Auction price bidding, as recommended by regulators, has never been used as the selection method in any of the almost 100 countries that have implemented MNP.

Auction bidding pitches the suppliers directly against one another to see who can offer the lowest price. Since the emphasis is solely on price, the purchaser runs the risk of selecting the lowest price bidder without factoring in other criteria like service levels, delivery, or quality.

An unsuitable supplier can have terrible consequences for quality, cost, or schedule. The purchaser may discover that the lowest bid is not the one with the highest quality product, or does not meet the required standards of delivery or customer service.

Selection methodology

Four (4) selection methods have been generally used for Clearinghouse awards:

• (1) Technical qualifications, experience track record and financial stability – Scoring
• (2) Technical qualifications, experience track record and financial stability + Price – non-weighted
• (3) Technical qualifications, experience track record and financial stability + Price – Weighted
• (4) Minimum Technical qualifications, experience track record and financial stability, then Lowest Price

The method used to select a Clearinghouse provider in countries with mobile subscriber populations of at least 100 million countries with MNP is shown in the table below:

Selection Criteria

So what can be the possible selection criteria for a country like Bangladesh that has 125 million subscribers?

A few options include:

• Number of countries in which the Vendor is under contract to provide Number Portability Clearinghouse services
• Number of countries in which the Vendor has been providing Number Portability Clearinghouse services for at least 5 years
• Number of mobile and fixed subscribers served by the Vendor's Number Portability Clearinghouse worldwide
• Number of countries in which the Vendor's Number Portability Clearinghouse serves at least 100 million mobile subscribers
• Number of countries in which the Vendor's Number Portability Clearinghouse services have processed 3 million or more cumulative ported numbers
• Number of years the Vendor has developed Number Portability products

For each criteria, Bangladesh authorities can set a target number after which points can be awarded depending on the degree to which the criteria are met.

Bidder qualification

Potential bidders should be required to submit information on their qualifications to ensure that they have the capability and capacity to undertake and manage the forest and to complete the contract. This may limit the number of potential bidders, but it will ensure greater uniformity of bidders, facilitate the evaluation of bids or proposals, and reduce the administrative costs in awarding contracts.

Information the bidders should be asked to submit could include company financials and ownership information, subsidiary and related companies, information on their operations in the country and in other countries, annual reports to shareholders and audited statements for the past three years, and preliminary information on their proposed operations in relation to the contract.

More detailed information should be required of qualified bidders as part of their tender or proposal.

Is Open Outcry Auction an option?

This will give rise to unhealthy competition as the highest bidder may have the ulterior motive to take the project, paying off the auction amount, but not eventually executing it. Non-implementation of the project will mean such a bid winner and their "behind-the-scenes partners" will gain huge business benefit – which is very likely given the industry scenario in Bangladesh – by not allowing the Customer to port to other networks.

The whole purpose of the project will thus be defeated and consumers will be deprived of the benefits of MNP service.

Open outcry auction for such a service must not be an option.