Saturday, March 13, 2010

A New Era in Indian Telecom Industry

Today I saw MTS Telecom ad of 1/2 Paisa call charge per minute. I remember days when mobile telecom operator used to charge 17 rupees per call. My brother used to use a bulky Phillips mobile handset in 1996. He used to use BPL mobile service. At that time even incoming calls were charged. Practically, it was impossible for a common man to own a mobile phone at that point in time. Last month, we have crossed 500 mn subscriber base mark. Phone penetration level has increased to 46% compared to less than two digits some 10 years ago. Earlier, it used to take 9 - 12 months to get a phone connection. Today, you get phone connection within a day. These developments will help India grow very fast.

Today, if you want to buy vegetables or order a sandwitch or dosa then you just need to call vegetablewala or sandwitchwala bhaiyaa on his mobile phone. He will deliver you vegetables at your door step. Even kamwali bais & ghatis are carrying mobile phones nowadays.

I think this is a beginning of new era in telecom. Mobile phone charges are affordable now. It has come down by 30 times in last 12 years. This has become possible due to price war in Telecom industry initiated by Tata Doccommo. They have come out with innovative tariff plans such  as 1 Paise/Min, 1 Rs per call etc..They have made all their competitors follow them.In a country like India where ARPU(Average revenue per user) is less than 150 Rs, it is very difficult to survive if you do not manage to get large subscriber base. In US and Europe, ARPU more than 5 USD. I have always wondered how telecom companies are managing to be profitable.

Telecom companies have become more creative in last 2 years and came out with innovative plans. Thanks to Tata Doccommo who changed the landscape of Telecom industry by introducing innnovative plans. All & all it's good for consumer like me.

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