Telecom India – Tariff war that never ends

Indian telecom market might be growing fast, but surviving in this highly competitive market is not easy for telecom companies. Here’s the list of schemes that fuelled the tariff war in India and brought down the ARPU significantly.

Post card or Phone call:

Reliance Infocomm launched mobile services in India at 40 paise per minute fulfilling Dhirubai Ambani’s dream to make a phone call cheaper than a post card in 2003.

Chotta Recharge:

Hutch (Vodafone now) launched the chotta recharge voucher at Rs.10 when the lowest add-on recharge card available was about Rs 50. What’s the message? Lowering the price by 20-30% to the competitors won’t help much in gaining the market share. Think five times cheaper to make an impact.

Non-stop Mobile:

So Life went good with chotta recharge. But there was a problem in prepaid mobile. You need to recharge regularly as the validity period is limited. With the recharge card of Rs 200, you will get validity only for one month. So people have to spend at least Rs2000 per year for their mobile just to receive the incoming calls. Not so long.

Tata Indicom launched Non-stop mobile, a scheme where you don’t need to recharge for 2 years but still get free incoming calls. Soon other players responded to Tata Indicom’s plan and then come in Lifetime validity plan by all major telecom players in India.

Get paid for incoming:

Customers are happy with their free incoming calls. Not the new telecom players. Virgin Mobile jumped into the competitive Indian mobile telecom market with the breakthrough-marketing scheme, Get paid for incoming calls. 10 paise free for every minute of incoming call. That’s the deal.

Daily telephone allowance:

Getting paid for incoming calls is fine. But what if you don’t get incoming calls. Don’t worry; Anil Ambani is ready to help you now. Reliance Communication launched its GSM services in Mumbai offering subscribers Rs 10 talk-time every day for the first 90 days. That’s free talk-time worth Rs 900!

With more new players like Swan-Etisalat, Unitech-Telenor and Datacom (subsidiary of Videocon)  entering the Indian mobile market, this tariff war is not going to end soon.

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  1. […] Telecom price war in India has got even fiercer with the introduction of MCard by MTS. So, for those customers who are not that happy with free incoming calls for life, MTS has come up with a plan, 10,00,000 minutes free or simply lifetime free outgoing. Of course conditions apply. Minimum of Rs 200 top-up over a period of 6 months is mandatory. And most importantly 150 mins/day is applicable only on local calls from MTS to MTS. […]

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