Local software developer Whitesmiths claims an Australian first in its system to identify pre-paid mobile users about to defect carriers, allowing for the minimisation of churn rates.

By analysing a sample of customer data over an extended period of time (six months) and approximating profiles of pre-paid mobile users, Whitesmith's Decision Support System can identify customers that are likely to churn up to six weeks before they do, according to Whitesmiths Australia managing director John O'Brien.

Once potential churners have been identified carriers can resolve customer issues and implement loyalty retention systems. "The idea is to keep them pleased or lose them as a customer," O'Brien said. -Give them a AU$5 card voucher and it costs the carrier effectively nothing but the customer of course thinks they're getting something of great value," he added.

Piloted with a UK-based GSM carrier with a pre-paid subscriber base of more than four million already, O'Brien claims that such analysis of churn indicators in Australia has only been carried out for post-paid mobile customers to date.

Furthermore, since mobile number portability (MNP) came into effect on September 25, allowing customers to take their mobile number with if they change carriers, customers have become more mobile and churn has increased 1.5 percent in the two months since, according to O'Brien.

"Currently it costs five times as much to get a new customer than it costs to keep one you've got," O'Brien said. Carriers would see return on investment in under a year, -probably sooner" he added. "I think this will be something they'll all be interested in."

Asked if the profiling tactics - which analyse usage patterns to determine customer demographics including home suburb - were not privacy invasive, O'Brien said: -It's not invasive, carriers already have the information, it's simply assembling that information in a different way."

Australian carriers are reluctant to talk about churn, whether it be the extent of it or business strategies to prevent it, so it was difficult to ascertain whether or not Whitesmith's system would be of interest to them.

Optus, which claims to have seen a reduction in churn to 14 percent for the year ending September 30, 2001 from 20 percent for the corresponding period of the previous year, says it already has a number of programs in place to minimise customer churn, but would not elaborate.

"Maintaining customers is not just about software, it's about making sure you look after them as well," spokesperson Louise Ingram told ZDNet Australia. -It's also about continuing to offer customers good value."

Vodafone also said minimising customer churn was about giving customers the very best service they can get. -Our main strategy is constantly keeping in contact with customers," spokesperson Germaine Graham said.

-Like all companies who have customer service we have an on-going program to keep in touch with customers and make sure they're happy with our service," she said. Asked if Vodafone would consider implementing a Decision Support System such as Whitesmith's she added: -We're always open to look at anything that might make customer experience the best it can be."

Whilst the UK pilot participant is using Whitesmith's collated data, it isn't using the Decision Support System proposed for them as they -haven't got the budget allocation for it" O'Brien said.

When asked if the flailing telecommunications climate in Australia would affect the take-up of the system locally, O'Brien said: "I think one of the things the downturn in the telecommunications sector will result in is that anything that delivers increased revenue for carriers will be looked at more closely."

Whitesmith claims so far to have had a -level of interest" from one Australian carrier and is expecting to be in discussions with another carrier before the end of the month.

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