Ideas for new mobile operators

I was going through Rajesh Jain’s blog post where he has penned downs some ideas that the new crop of mobile operators could use, both to differentiate themselves at launch, as well as establish themselves, and get a large number of subscribers. Rajesh has himself given some excellent suggestions like:

  1. Focus on Data-hungry customers with a flat Rs. 99 per month plan
  2. Use a more open and participative VAS platform to entice users
  3. Open the User Profile to Third-party services

I’ve been thinking myself on how the new crop of operators (the Swan Telecom, Unitech-Telenor, Shyam Systema etc.) would market themselves, and would they take a niche or undercut prices and go for the masses. Well, Shyam has already launched as MTS (Shyam has chosen to use its JV partner’s branding straight away, so as to clear the way for a possible sale in the future I believe), and chosen to go after the masses, giving out a truckload of minutes free for lifetime prepaid. Too see a list of telecom companies in India, refer to Wikipedia.

The way I would like to approach this is to see what the shortcomings of the market currently are, and how they can be fixed, and I would probably enumerate them as these:

  1. Undercut prices further for the bottom of the pyramid – I think the prices at the lower end of the spectrum can go down further, and that’s because even though we are lowest cost mobile services country in the world, the distribution infrastructure has been commoditized (buying and selling prepaid credits, separate tower companies, billing systems etc.), and the lowest rung of customers that are added today, would not be as heavy users and will not occupy as much spectrum per capita. Since, currently mobile companies are more or less valued based on the number of subscribers, there will be a mad rush to acquire customers, and undercutting is the simplest way to do it. [This is already the strategy that MTS is using]
  2. More value for the middle tier – I think some of the mobile operators are going to figure out “one size fits all” is not possible, and there are lots of opportunities in segmenting and targeting. I personally see very unique plans applicable for companies giving out phones to their sales people, incoming plans for companies, family plans, lover plans (which already exist), college plans, children’s plans, election plans (?) etc. with a good number of VAS services that are bundled in for that target segment. Of course, this would require better content and VAS services, and hence more rev share for VAS players.
  3. Fanatical Support for the top tier – I think one place where the current operators are lacking is servicing the top tier really well. These are the high value consumers that perhaps constitute well over 40% of the market. In some cases like Corporate Connections, they do get enhanced support, but the large swathe of India still has many high intensity users, from SMEs, businessmen, lawyers, dealmakers etc. and some of the new operators could target these and probably charge them an extra Rs. 200 per month for extensive support and personalized services. For instance, I have an Airtel connection and my GPRS just refuses to work when I am on roaming, and I have probably spent more than 40 hours trying to find a resolution but in vain. I wouldn’t mind paying some money to get this issue resolved.
  4. Better Roaming (Domestic & International) – One place where most operators are lacking is good support and costs for roaming, both National and International. They cost a lot, they are painful because you can’t figure out how much you are going to be charged, and if it stops working when on roaming, you are dead in the middle of the desert. I would foresee prices in this area going down quickly, because customers of point (3) are typically also heavy users of point (4). However, this would require an India wide network, and a long distance backbone before this can be attemped, and I think Tata Docomo is very well suited for this.
  5. 3G and all the frills – This will be another turf fight, but I think its extremely raw now, and difficult to figure out how its going to pan out.

With all the new entrants, the media will be big winners, since they are going to advertise like mad – good news for newspapers, outdoor companies, and TV channels.

What do you think? How is the entry of the new players going to play out and what would you like them to do?

About kpowerinfinity
I *♥* technology, business, conversations, experiences, books, music, theater, coffee and people. I am an entrepreneur in the city of Bangalore - my company, Capillary, provides customer engagement programs and marketing services to retailers around the world.

9 Responses to Ideas for new mobile operators

  1. Nicely, some very good points. Would just like to add to the service aspect put forward in point for. The term ‘Customer Service/Customer Care’ roughly does not exist in the Indian telecom industry. I have rarely heard of anybody who was able to resolve his/her problem through Customer Service/Customer Care. There’s lot needed in this area not just for top tier but for all tiers.

  2. bhuto says:

    Do check this BT cover story on similar lines http://businesstoday.intoday.in/index.php?option=com_content&Itemid=1&task=view&id=10963&sectionid=22&issueid=55&page=archieve

    It does talk about how Nokia and its partner carriers are leveraging the rural sector for unprecedented growths here in India when the sector elsewhere is shrinking ( esp handset sales ).

    • @Bhuto: Unfortunatey, the page obstinately asks you to login first, without having a login link anywhere :-)

    • bhuto says:

      Hmm not sure why its not asking me to login :( . I do not have an account either . You can try BT Website > Archives > 3rd May Edition Cover story .. Hope that helps …

  3. sankalp says:

    I read through your post and Rajesh’s post. Emphasis is on the idea that marketshare is the key to survival in battle of giant corporates & in that they should provide value for money to every customer by dissecting the whole population into maybe 4-5 groups. While doing this they also need to amend traditional profit making methods(which I think is not easy).

    Examples of winners using this strategy may be many, but I know one(I am not an MBA :D)…thats too HeroHonda..but it came when Bajaj was outsmarting HH. Can you provide me a similar example in service industry?

    • @Sankalp:

      I would say that the best example of a service industry that has done good targeting is Credit Cards / Banks. There are umpteen number of products available for each individual need, and they also do a good job of trying to find the right customers for their purpose.

      Also, networking – there are separate enterprise networking providers with different needs, and home broadband providers (though they may be buying bandwidth from the same people).

      I don’t believe there is something called a “traditional” profit-making method in telecom, primarily since its a business that changes so fast. If you become traditional, you die.

  4. Anamika patil says:

    i firmly believe that tata docomo has ticked all the points discussed in this article…what i think they’ve got right as well is their overall approach of targetting the youth..there are lakhs of new entrants in the mobile phone market each year (for eg: college students)…and tata docomo is conciously targetting them..not just by revolutionary plans but also by their tv ad’s, funky new ringtone, and i understood all this when i visited their site (http://tatadocomo.com/default.aspx)..whch is very young and energetic as well…so i gues its a move in the right direction for tata

  5. shibu says:

    gr8 plans from docomo..hope the per second pulse n the VAS offers r for lifetime.. then docomo will surely rock the telecom market..no doubt..

  6. Pingback: Shyam systima | Algebratesting

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