In spite of veering away from the conventional per minute billing to a per-second basis, Tata Teleservices said Tata DoCoMo is gaining high minutes of usage and average revenue per user (ARPU) as per the industry standards. This GSM brand is also getting good traction in terms of subscriber base and the company has recently added more than one million subscribers within the first month of its launch in the Maharashtra and Goa circle.
Declining to divulge any ballpark number for ARPU generated from these subscribers, the company said it is in line with the industry standards, which typically ranges between Rs 200-250.
To explain it further, per-second billing is not the cheapest tariff being currently offered. When Reliance Communications (RComm) launched its GSM service in Mumbai earlier this year, it offered GSM SIM at Rs 25, which DoCoMo did at Rs 100. Unlike DoCoMo, RComm?s GSM plan offered 900 minutes of local talk time and SMS to any network in daily tranches of Rs 10, spread over 90 days. This enabled RComm to rope in nationwide five million subscribers (CDMA and GSM) compared to the Tatas, which attracted 3.4 million subscribers. In addition, RComm had launched a similar scheme with a 15-second pulse rate when it launched its CDMA operations in 2004, but phased it out as soon as it gained a critical mass of subscribers.
?This would have been be a massive loss-making strategy had been continued for new subscriber acquisitions beyond a six- to 12-month period post launch,? said Macquarie in its recent report.
?Our DoCoMo product is doing very well since the market is reacting positively to the per-second billing concept. There are three things which have worked in our favour. First is the per-second billing concept which the subscribers have appreciated, then the extension of this into STD, which is an unconventional offer, and the third is lifetime validity offer on this service during our promotional phase,? said Mukund Rajan, MD (Maharashtra) of TTML.
TTML is also evaluating the pay-per-call concept that is already being offered on the CDMA platform across the Tata Teleservices circles (i.e. barring Mumbai, rest of Maharashtra & Goa circle). ?Consumers are happy with what we are already offering. However, we are still evaluating ?pay-per-call? concept. We already have seven prepaid and 18 postpaid promotions going on,? he added.