An Empirical Study on Consumer Preference for Mobile Number Portability:Case Study of Cambodia

Mobile number portability has been widely introduced in many countries to reduce switching costs and to increase consumer satisfaction and the market competition. This paper intends to examine consumer preference for the MNP in Cambodia for a better understanding of the consumer preference and their willingness to pay for the MNP. The research model is adopted from the technology acceptance model and the consumer preference is estimated from the conjoint analysis. The findings illustrate all alternatives are significant at 95% level of confidence, while the porting time is the most essential factor, compared to the porting fee and porting process. The consumers are willing to spend less than one day, to pay less than US$2 and not to meet a complicated porting procedure. The insights of the consumer preference on the MNP play a crucial role for the regulator to introduce the innovation with a reasonable porting time, fee and process. market survey in 2010 shows that more than 56% of mobile users had difficulties during within-network communications and over 73% faced the same difficulties during across-network communications (Vong, Lee, & Zo, 2012). Similarly, less than 50% of responses in Cambodia’s telecommunication market show their positive feelings or satisfaction towards their current suppliers while they have no any intention to switch service providers, and this implies the fear of losing phone numbers (Leng, 2014a). Phone number has become popular as status symbols in Cambodia while the suppliers use them to lock their uses. Some phone numbers which define users’ fame and power have been purchased and used mostly by the high class people to show off their wealth and power. The definition of socalled special or unique numbers are defined as a good Feng Shui (based on Chinese belief) or ordering number such as 012-345678, 012-333444 and 012888168. The demand of these numbers inflates the prices and some possibly cost higher than US$1,000. Hence, majority of the users possesed more than one sim cards from different mobile operators. It is not uncommon to hold three mobile handsets in Cambodia and some handsets can be used with multiple simcards (Simon K. , 2012). Another empirical research (Leng, 2014b) has also studied the consumer switching intention in the mobile telecommunication industry in Cambodia. The findings demonstrate many users are retained despite the dissatisfaction with the current suppliers while changing phone numbers becomes a main switching barriers. Though the MNP is not yet introduced to the market, the respondents strongly believe it would facilitate and increase their switching intention. So, majority of the respondents show their attention to the availability to the MNP in Cambodia. The absence of the MNP allows each mobile carrier to receive their exclusive licenses in the mobile numbering plans. As it is lack of the overarching framework and regulatory policies in Cambodia’s telecommunications sector, many licenses of different number segments have been provided at a very low fee, which allows each service provider to purchase many number segments and to make business with those numbers in inefficient ways (Moa, 2014). For example, after the merger and acquisition of some mobile service operators, Metfone remains the leading mobile operator with the biggest market share of 43.60% by the August 2015 (Im 2015c). Smart Axiata has taken over the CamGSM to be the second market leader in the number of mobile phone subscribers with market share of 37% while the market share of the CamGSM has decreased to 18.4% and other four operators hold less than 1%. Mefone has received licenses on nine number prefixes while Smart Axiata has 11 and CamGSM possesses 13. Based on the report of the telecommunications regulator of Cambodia, the number of the registered simcards of Metfone is about 26% of their total licensed numbers, compared to Smart Axiata at 50% and CamGSM at 23% (Moa, 2014). Moreover, when one mobile carrier has an exclusive license on many number prefixes, it also possesses a large number of special and lucky numbers. Consequently, the mobile carriers with only one licensed number prefix are not able to compete against the incumbents, and consequently it causes an unfair competition in the supply of the phone numbers. Furthermore, these few dominant suppliers cause the market high concentrated, by applying the HerfindahlHirschman Index (HHI) which is widely accepted in the competition law, antitrust law and technology management to measure the concentration level in a particular industry (William & Alan, 2009). The HHI of mobile telecommunication industry in Cambodia is about 3600 in 2015, compared to 2310 in the early of 2010 (Im, 2015c and Phun, 2010). This implies the market competition is moving toward the duopoly or even monopoly. In addition to the inefficient uses of the numbering plans and the unfair competition, the control of the scarce resource becomes an obstacle for the future expansion of the mobile network and further investments in the industry because those licenses cannot be