Telecom Scramble

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: Telecom industry is getting ready for a makeover this festive season. New operators have entered the already crowded telecom space, seeking a slice of the market pie where Bharti and Reliance dominate the GSM and CDMA space respectively. These new operators have introduced innovative and attractive tariffs such as per second billing, which has forced existing operators to match or even come up with better offerings. Others such as Reliance, who have not opted for per second billing, have decided to lure and retain customers with hard-to- believe 50 paisa per minute tariff plans.

To add to the excitement, mobile number portability is round the corner and has the potential to radically shake-up the market. Telecom operators are already preparing for a significant subscriber churn, especially among prepaid users. There could be a consolidation among telecom operators too.

Already, telecom regulator Telecom Regulatory Authority of India (Trai) is readying new merger and acquisition (M&A) norms. Broad contours of the emerging landscape are this: chaos could well run supreme unless the issues are handled carefully.

Mobile number portability was first expected to be rolled out in September 2008. Since then, the deadline for its implementation has already been extended twice, following resistance from operators who fear losing their high value subscribers. Interestingly, the delay has pushed it to coincide with feverish pace of action and could cause a bigger churn.

At a rudimentary level, mobile number portability allows subscribers to retain their existing mobile phone number when they move from one service provider to another in a licensed service area, irrespective of the mobile technology. It is thus a highly consumer-friendly initiative as it helps to increase competition between service providers and catalyses improved quality of service (QoS).

“It will empower the customers with choices and the tariff war will raise its bar which will go against operators. Telecom operators will have to differentiate their offerings by focusing more on value added services. In the initial stages, tariff will be main differentiator but over a period of time, quality of service and tariff will go hand in hand,” says Nitish Mittersain, CEO, Nazara Technologies. “End user will always be in win-win situation,” he adds.