Mobile Number Portability

Abstract

This paper examines the consequences of introducing mobile number portability (MNP). We show that if the sole effect of introducing MNP is the abolishment of switching costs, MNP unambiguously benefits mobile customers. However, if MNP also causes consumer ignorance, as telephone numbers no longer identify networks, mobile operators will increase termination charges, with ambiguous net effect on the surplus of mobile customers. We examine how extensions such as MNP based on call-forwarding, termination fee regulation, and alternative means of carrier identification affect these findings and discuss policy implications.