The Effect of Number Portability on Telecommunication Market

This paper analyzes the effect of number portability on the telecommunication market. The result shows that in a static setting, number portability will make the price, market share and the profit of the incumbent decrease while those of the entrant increase. In a dynamic setting, number portability will make both of the operators take competition strategies besides cutting prices, such as improving the quality of their products, and the scale of the market will be expanded. In a word, the introduction of number portability has the effect of making the telecommunication market more competitive. In China, we can introduce number portability to promote the competition of the telecommunication market.