The government has decided to grant licences to two mobile number portability service providers in the country, who will act as a clearing house to allow mobile users to seamlessly change their operator without changing their number.

A decision to this effect has been taken by the Department of Telecommunications and is likely to be announced by Communications Minister A Raja on Friday, sources told Business Standard.

However, portability services, which were earlier expected to be launched by the end of the year in the four metros -- Delhi, Mumbai, Kolkata and Chennai -- as well as Tamil Nadu, have now been delayed till February or March 2009 (the DoT has said that it will start operations six months after the licence is granted).

The department has also finalised the schedule for extending number portability across all circles by August-September of 2009, within one year from granting the MNP licence.

The two MNP service providers, to be selected through a "beauty parade", will be neutral hosts connecting the operators and customers. They will function as a sort of interconnect exchange that will have the required infrastructure, including a database of numbers, for porting calls.

All existing and new mobile operators will connect to this exchange and ensure network compatibility. For a user, it means a seamless switch to a new carrier, without his number changing at all.

Once implemented by August-September 2009, India's 300 million-odd subscribers will be able to choose their mobile operator at will without fearing that they will lose their numbers.

Last year, the DoT had announced the introduction of number portability in phases and had set a December deadline to roll out the facility in the metros.

Under the proposed terms and conditions, each MNP operator will provide the service in 11 circles even though the launch will be in a phased manner starting with the four metros and then expanding to other circles.

A key restriction has been imposed that bars a telecom service provider and an MNP operator from picking up any equity stake in each other's firms.

In addition, one MNP service provider will not be able to hold more than 10 per cent equity stake in the other MNP company. Foreign companies can become MNP operators, but their holding cannot exceed 74 per cent.

The MNP service provider will need to have a combined net worth of Rs 100 crore and will not be allowed to dilute equity below 26 per cent for the first three years.

The DoT has also put in stringent qualifications for the MNP service providers who will need to implement MNP solutions for a subscriber base of not less than 25 million in one or more countries, for a continuous period of at least two years.