- The Washington Times - Monday, November 17, 2003

Cellular telephone users will have greater control over their phone numbers when the federal government’s new “portability” rules take effect Monday, but customers will face penalties if they break their contracts to switch carriers right away. The Federal Communications Commission ruled last week that cell subscribers will be able to switch their home and business phone numbers to wireless and vice versa. Earlier, the FCC decided that cell users will be able to keep their numbers when switching providers. The changes take effect Monday for wireless subscribers in the nation’s 100 largest metropolitan areas, including the Washington region. The remainder of the estimated 150 million cell users will be able to switch beginning May 24. “You now have the ability to shop around for the best deal for you,” said Bill Hardekopf, founder of CellUpdate.com, a Web site that monitors the wireless phone industry. Wireless phones have become more popular in recent years, replacing home phones as the primary handset for many people. But analysts say few choose to drop land-line service altogether because they fear losing a phone number familiar to family, friends and co-workers. The number of land-line phones has declined by 5 million, or 3 percent, since 2000, according to the FCC. Cell phones make up 43 percent of all U.S. phones, up from 37 percent in 2000, the International Telecommunication Union says. Customers who want to switch carriers and take their phone numbers with them should do so only after their existing contract expires, Mr. Hardekopf said. Most carriers charge hefty penalties — sometimes as much as $500 — when customers break their contracts. “You don’t want to change in the middle of the stream unless you’re prepared to pay the termination fee. Avoid doing that at all costs,” Mr. Hardekopf said. Carriers are expected to charge customers who switch a “portability fee,” which most analysts say will cost a few dollars a month. Between 12 million and 18 million wireless customers are expected to switch carriers when the new rules take effect, according to estimates by American Management Systems Inc., a Fairfax business and information technology consulting firm. Other researchers have predicted as many as 30 million customers will switch in the first year. It costs a cell phone company between $350 and $400 to “acquire” a new customer, including the costs of marketing and issuing handsets, said David Meredith, an AMS vice president. “It is not a trivial expense. When someone leaves a company, you have to go out and replace that customer relationship,” Mr. Meredith said. The phone companies have been “playing defense” in anticipation of the new rules by trying to lock customers into longer contracts, Mr. Meredith said. After Monday, they will go on the offensive, lowering prices and trying to lure customers with new services, such as cell phones that play video clips and sophisticated games, he said. In Hong Kong, “wireless number portability” rules took effect in 1999, Mr. Meredith said. Roughly one-third of all cellular customers in Hong Kong have switched carriers since then. Between 2 million and 3 million U.S. land-line users are expected to cut the cord and move their home or business numbers to a cell phone over the next year to 18 months, Mr. Meredith said. Consumer advocates advise users to review the cost carefully before cutting the cord. A typical wireless phone bill is about $52 a month, compared with $36.50 for a typical land-line user. A wireless customer who wants to switch carriers and take his number with him should sign up for his new company before dropping his existing one, according to Alan Keiter, president of MyRatePlan.com, a Web site that tracks telephone plans. Once you drop your carrier, the number no longer belongs to you, Mr. Keiter said. A consumer should have a copy of an old bill with him when visiting a store or Web site to switch carriers, he said. If the existing carrier bills you as Jonathan Smith, for example, you won’t be able to take your number with you if you try to sign up with a new carrier as John Smith, Mr. Keiter said. “Everything is going to have to match up perfectly,” he said. Those who move from one area to another will not be allowed to keep their phone numbers. Someone moving from Phoenix to the District, for instance, will not be permitted to transfer his Phoenix home phone number to a cell phone in Washington.


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