Cell Phone Switchers Find Glitches

The U.S. Federal Communications Commission this week sent a letter to AT&T Wireless Services requesting explanation for the problems it is having porting phone numbers to and from its network.

The carrier is reportedly having the most trouble of any complying with the FCC's wireless number portability rules, which went into effect November 24 and are designed to stimulate competition by enabling subscribers to change carriers but keep their wireless or landline phone number. To date, only about 250,000 subscriber porting requests have been made, according to market research firm Mobile Competency.

Mobile Competency says half of those requests were not completed, but published reports state that AT&T Wireless is having the most trouble of any carrier, with a 60 percent failure rate.

"As more consumers opt to port, it is critical that carriers' porting systems function properly," said John Muleta, head of the FCC wireless bureau, in the letter to AT&T Wireless. The carrier has until December 10 to describe the problems and what it is doing to fix them, according to the letter.

AT&T Wireless was not immediately available to comment.

Lack of Preparation

Bob Egan, president and founder of Mobile Competency, says that unlike the Year 2000 problem, carriers did not prepare for the date-specific event of wireless number portability. As a result, a process that that should, by FCC standards, take only two-and-a-half hours is taking up to a week or longer, according to Egan.

"We didn't see any of that [preparation]," Egan says. "Carriers were not prepared and third-party interconnect companies were not prepared."

Egan says accuracy of subscription and billing data is an issue in whether a number port goes through. Information such as middle initials, titles, and abbreviations have to appear exactly as they do on the subscriber's current account before a port is successful.

If a number port is not complete, subscribers are stuck paying for two services--the one they are trying to leave and the one they are trying to go to, Egan says.

"It's a mess," he says.

Liar's Poker?

Egan also says there may be some "liar's poker" going on. Carriers may not want to encourage porting for fear of losing customers--and revenue--during the holiday season.

"There's a critical fourth-quarter revenue implication" at play, Egan says.

Indeed, customer churn costs money with or without number portability. According to market tracker RHK, churn costs the industry $900 million to $1.3 billion per month.

As a result, the major wireless carriers were not publicizing portability for fear of losing customers, the firm asserts.

Instead, they've been offering attractive rates over longer periods to lock in subscribers, RHK found.

There's also an inherent cost to the subscriber in number portability. Customers wishing to change providers might also have to change handsets if the underlying technologies of the provider networks are different, RHK says.

The North American market uses at least four different wireless technologies: CDMA, TDMA, GSM, and i-DEN, which is the foundation of Nextel's DirectConnect network.