Reality Check: Telecom stakeholders – when the FCC gambles on number portability, consumers stand to lose

The Federal Communications Commission will soon make a critical decision regarding a vital component of the U.S. telecommunications infrastructure: selecting the administrator for local number portability. Portability enables U.S. consumers to keep their phone numbers when they switch carriers and supports the routing of virtually every voice call and text message sent across the country.
The FCC will decide whether to stay with current vendor Neustar or direct the industry to transition to a new vendor, Telcordia, a subsidiary of Ericsson. The contract with Neustar is currently scheduled to expire in July 2015, about 10 months from now.
The LNP administrator stores and distributes routing information for more than 650 million U.S. telephone numbers — wireless, fixed line and VoIP. Each day more than 1.5 million new or updated numbers are broadcast from the registry in seconds to telecom networks across the country. Service providers use the LNPA to acquire new customers, deploy new telephone number inventory, and update network technology and service offerings. The system is highly reliable. Calls and texts are routed to the desired device, and customers have the freedom to change providers without losing calls, texts or their number.
This was not the case in the early days of competition following passage of the Telecommunications Act of 1996. For most of the first two years after 1996, when a number failed to port in a timely manner, the new provider usually lost the customer back to their former provider. Changing LNPA providers must be done right — with a seamless transition and maintaining the integrity of the system — or customers and competition will be the losers.
There are many critical questions/issues the FCC must consider before it makes its decision. Can the FCC negotiate a contract and supervise the transition to a new provider in 10 months or less? What is included in the new provider’s bid? What is not included? What are the impacts of migrating to a new, unproven platform? What are the true costs of a transition, and who will bear those costs? How will the effort impact other industry priorities, such as the migration to all-IP networks? Does Ericsson meet the impartiality requirements for service as the LNPA?
The LNP Alliance, which represents a group of small competitive carriers, has filed comments outlining these concerns and the potential negative impact on customers and carriers. Telcordia’s neutrality is a major issue since it is a wholly owned subsidiary of Ericsson, an equipment manufacturer that also manages wireless networks. The LNPA provider must be independent from industry relationships that might affect its neutrality in dealing with various carriers.
Another concern is lack of detail in the request for proposal regarding the LNPA’s role in IP network transition, which has been underway for more than a decade. Neustar offers ENUM routing today as part of the database services. Telecordia, in ex parte filings and white papers, has a different view of these requirements. The FCC must clarify this beforemaking its selection.
 Transition risks: Too costly, not enough runway
A transition to a new vendor will require new equipment, software development, testing, methods and procedures, data migration and trained staff. Recognizing the complexity, industry experts who initially evaluated the project called for a 33-month transition. The current schedule calls for the job to be done in less than 10 months. That’s totally inadequate.
In its comments to the FCC, service provider Suddenlink raised concerns that the process has not established transition roles, governance or an agreed-upon timeline. The carrier also commented that thorough, nationwide testing will be needed to ensure stability and continuity of service before any transition.
Similarly, the Competitive Carriers Association noted that the FCC’s process has not taken all transition-related costs into account. Suddenlink warned that unaccounted-for costs to move the LNPA could fall on service providers, and ultimately, its customers.
When providers lose, so do their customers
In its filing, Suddenlink shared analysis from Hal Singer of  Economics predicting that more than 7 million consumers could experience problems related to a transition, with as many as 1.5 million unable to receive calls at all in the early stages.
Additionally, analysts expressed concerns that porting times could significantly increase. Cove Street Capital highlighted that a number port can take seven days or more in countries where Ericsson subsidiaries currently manage LNP. Instability and loss of service in the United States could seriously impact competition and add considerably to carriers’ customer acquisition costs.
Another area of concern: A transition jeopardizes the LNP services used daily by law enforcement and public-safety agencies. Intrado, a provider of 911 support services, noted that without services currently offered by the LNPA, it would have to resort to alternative processes, potentially impacting 9-1-1 call delivery.
Neutrality is a big question
Ericsson is a foreign company with substantial business ties to major wireless carriers — a clear conflict of interest and a threat to the LNPA’s mandate of neutrality.
In their comments to the FCC, service providers Telepacific and HyperCube noted that Ericsson dominates network equipment sales across the North American carriers. They wrote that the FCC needs to closely examine NANC’s recommendation to “ensure that the proposed transition to a new vendor, and the risks that such a transition will create, are not unduly borne by small service providers as opposed to the larger service providers that made the recommendation.”
 So what’s next?
At this point in the FCC’s selection process, what can be done?
First, the FCC’s process leading up to the North American Numbering Council’s recommendation needs to be reexamined. The commission should not make a final decision without identifying the impact this move will have on consumers, communications companies and public safety — and communicating those impacts to the public. The timeline for transition is woefully inadequate and not nearly enough attention has been paid to the consequences of diluting the LNPA’s neutrality requirements. (See LINK for more background.)
All telecom stakeholders need to urge the FCC to hit the reset button and reopen its evaluation of the impact of an LNPA switch.
Editor’s Note: Welcome to our weekly Reality Check column where C-level executives and advisory firms from across the mobile industry share unique insights and experiences.