Number portability to cut SME cost saving options

11 Jul 2003

Irish SMEs that use special gateways attached to their phone systems to reduce to price of fixed-line calls to mobile phones may find themselves out of pocket once full number portability is introduced on 24 July, a telecoms expert has warned.

Thousands of SMEs around the country install special GSM gateways manufactured by companies such as Siemens and Nokia to their company private branch exchange (PBX). The gateway device essentially allows employees dialling a mobile number, be it 087, 086 or 085, from an office line to reduce the cost of the call, explained Brendan Moran, managing director of MinuteBuyer, a firm that specialises in brokering low cost calls for Irish-based companies.

For example, a call to an 087 number from a desk phone will be routed through the gateway device which contains a SIM chip and a mobile antenna, converting the call from a fixed-to-mobile call into a mobile-to-mobile call. This results in price reductions, from 20c per minute to 10c per minute, saving firms thousands of euros annually.

It is understood that both O2 and Vodafone market these gateway devices, albeit reluctantly, as they receive a higher share from fixed-line calls.

Moran said: “Firms typically have two gateways set up to handle 087 calls and 086 calls. This is because cross-network calls are prohibitively expensive.”

However Moran has warned that when number portability arrives on 24 July, firms will find it harder to get the benefit. “While an employee or customer might have an 086 account, they might previously have been an 087 customer and will still have the prefix and will find it difficult to get the cost benefit. Both Vodafone and O2 know this, but are unlikely to allow for it and companies will end up paying the full cost of either a cross-network call or a full fixed-to-mobile call.”

Established two years ago, MinuteBuyer is a virtual network operator, buying voice call minutes in advance from international carriers and transferring the lower-cost calls to Irish businesses that regularly conduct phone traffic with the US, Europe or Australia. Once a low cost rate has been established, MinuteBuyer informs its customers to append a five-digit routing code of a specific telecom carrier to avail of the low rate calls. “We succeed in reducing the cost of international traffic for our customers by an average of 45pc,” Moran explained.

The company negotiates telecom minutes on behalf of Irish firms with MCI WorldCom, Esat BT, Colt, NTL and Cable & Wireless.

According to Moran, SMEs with GSM gateways are unlikely to see an immediate effect of number portability, but will notice it gradually as individuals participate in the churn that it will create.

By John Kennedy