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Portability spells sink or swim time for small mobile networks

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HONG KONG'S cellular phone market takes another big step in its development tomorrow with a move that is likely to hit the margins of established operators and offer the best chance yet for newer companies to poach subscribers.

Analysts agree that in headline terms the most likely effect of the introduction of mobile number portability is for the SAR's six mobile operators to converge in terms of subscriber numbers. In other words, the likes of Hongkong Telecom, Hutchison Telecom and SmarTone will lose subscribers while the others gain.

'It's a big step in developing full competition,' HSBC Securities telecoms analyst David Gibbons said.

Portability allows customers to swap networks while keeping their personal phone number. Reluctance to lose their personal number is often seen as a big factor stopping people changing networks, or churning.

Churning averages about 5 per cent of the market a month.

'Clearly churn rates are going to be driven higher,' Mr Gibbons said.

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