Markets: Eerie calm

Markets: Eerie calm

it is not clear when market sentiment can change; as in the past, it can be quite sudden.
At a turn and yet not

At a turn and yet not

RBI could be tempted to cut policy rate to support growth at its bi-monthly review.

Telcos slash mobile data rates to win customers

Mar 24 2014, 10:49 IST
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Vodafone, Bharti, Reliance Communication & Idea make data packets 80-90% cheaper in last three quarters (AP) Vodafone, Bharti, Reliance Communication & Idea make data packets 80-90% cheaper in last three quarters (AP)
SummaryVodafone, Bharti, Reliance Communication & Idea make data packets 80-90% cheaper in last three quarters

As mobile data becomes a revenue driver for telecom operators, companies such as Vodafone India, Sistema-Shyam and Telenor (Uninor) are devising new strategies and launching aggressive data plans to boost traffic, make customers migrate to high-speed technologies like 3G and ward off impending competition from Reliance Jio.

In the last three quarters, Vodafone, Bharti Airtel, Reliance Communications and Idea have slashed data pack rates by 80-90%. Currently, most players charge between 2 and 10 paise per 10 Kb for data downloads. As Subrat Padhi, business head, Delhi, Vodafone India, puts it, “data is the future and the ecosystem surrounding it will continue to grow.”

Vodafone recently started its ‘Be Smart’ initiative, which aims to educate smartphone users to shift to 3G.

Sistema Shyam's latest mobile data offering could initiate a price war of sorts. For MTS postpaid customers, 40 GB data download is available for a monthly tariff of R999 while prepaid subscribers will get 20 GB data for the same price (average speed of 9.8 Mbps). Earlier, MTS gave 10GB data for this price. Compare this to Vodafone's monthly postpaid data pack that offers ‘unlimited’ downloads at Rs 1,250 per month. The catch is, 3G speeds (between 1 Mbps and 21.1 Mbps) are available only up to 8GB of download, after which it drops to 64 Kbps. While Airtel offers 10GB data download at 3G speeds for R1,500 per month, MTNL offers 10GB download for Rs 850 per month.

According to Leonid Musatov, chief marketing & sales officer, MTS India, “Our data plans have been specially designed to provide at least 300% more value than plans offered by competition.”

Data revenue, which forms around 7% of telecom operators' overall revenue, is expected to increase to 21.7% by 2017-18, according to equity research firm PhillipCapital India. Moreover, with more smartphones being sold in the country — 17% today compared to around 7% last year — operators are betting on increased movie, video, and music downloads on handheld devices.

Meanwhile, Norway- based mobile major Telenor's Indian venture, Uninor, has changed its mobile data strategy from volume-based net offerings (MB and GB offerings) to service-based offerings. It has tied up with Facebook and WhatsApp to provide monthly unlimited usage of these social networking sites at R15 per month.

“Selling internet as rupees per MB is like selling air or train tickets as rupees per kilometre,” said Morten Karlsen Sorby, nominated CEO of Uninor. “Internet

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