Market innovation: Where the Indian telecom operators lack

July 30, 2021
Devinder Dhingra

Satyam (The Truth)

Recently Airtel has closed its 49 Rs. entry pack, citing revenue issues. So, it’s now a minimum 79 Rs. if you wish to stay with Airtel. Vodafone will surely follow it in the coming days. Jio already has a higher minimum entry pack for prepaid. Earlier Airtel had a data entry pack like Rs. 48 with 28 days validity, but now even that is not available standalone. Why? Only they know.

When Jio began its commercial operation, it smartly worked on a minimum entry pack that was higher than Rs. 100 for prepaid subscribers with unlimited voice calls. It did not introduce any pack with a specified talktime. Airtel and Vodafone, instead of doing any market innovation, simply followed the same but kept a Rs. 50 higher price for almost all the recharge options. Why Rs. 50 higher? Why were they so afraid of a price war from Jio? They could have easily kept just 10 or 20 Rs. higher.

Later, they came up with the idea of Rs. 49, Rs. 79 packs that were desirable. And equally desirable were standalone ‘data only’ packs like Rs. 48, Rs. 78 with an option of a number validity as well, which now they are taking away. An area where they have a niche, they are deciding to close. Why? Only they know. A minimum of Rs. 79 pack plus a data pack of Rs. 48 is nowhere better than an unlimited voice pack that gives 2GB data as well.

Why do they lack market innovation? Why are they forcing people to buy a pack with unlimited calling? And why are they not providing ‘data only’ options with a defined validity?

The telecom has grown to 5G and it’s basically now the data, even for voice. Then why stick to only voice options to retain a number? All the operators must have ‘data only’ options with a defined validity like the 48 Rs. pack that Vodafone currently has and Airtel had it a month before. How can they force people to pay them a certain minimum revenue as per their choice? TRAI must intervene here.

Then there are people who keep two SIMs from two different operators because of network issues at different places. These people use the one as their main number and hardly use the other. Why shall they be forced to pay a higher minimum entry price to keep their secondary number alive?

In the earlier telephony, a circuit was reserved for a landline subscriber even in the idle mode and thus consumed a permanent resource, but the same is not the case in LTE. An idle subscriber just listens to the broadcast after it has latched onto its telecom network and has been assigned an IP address. Resources are only consumed when there is traffic, mainly voice and data, both incoming and outgoing. If the call is on-net, i.e. both the calling and called subscribers are on the same network operator, the telecom service provider is anyway generating revenue from the calling subscriber. So, why force customers to pay a minimum value to retain a number with just a ‘voice only’ option?

The telecom operators may instead innovate on introducing a pack that limits the incoming calls as well e.g. they may introduce a 50 Rs. pack that limits incoming calls at 15 hours a month and provides a talktime of Rs. 25 for outgoing calls.

TRAI did a good job in the case of DTH by restricting operators not to charge higher for the second set top box, a multi-TV connection. It was needed. In fact, they should have even restricted the channel providers for the second connection. Why shall a TV channel charge Rs. 19 for even the second connection? It shall actually not be more than Rs. 5.

Sundaram (The Guidance)

It’s time for the telecom operators to treat voice and data at par and provide the following:

1. Do not take away ‘data only’ pack options that have a defined validity like ‘Rs. 48 with 28 days validity’. Instead, introduce more such packs that give choices to subscribers to continue without a mandatory voice pack. Introduce Rs. 25 pack with 1.5 GB data. If customers shall use voice, they shall anyway pay you extra for talktime.

2. Introduce combo, bundled offers, for limited voice options as well. Why force everyone to go for unlimited voice calls? What about a 75 Rs. pack that gives a subscriber different options like: either take 4GB data plus Rs. 5 talktime or 1GB data plus Rs. 40 talktime etc.

3. Jio has a data top-up option of Rs. 11 that provides 1 GB data. Such options shall be introduced by Airtel and Vodafone as well.

4. Why is JIO not introducing limited voice packs and forcing everyone to go with a minimum pack of more than Rs. 100 to retain a number? Jio shall also have lesser value packs.

5. Why not offer minimum priced recharges also for a six month validity or one year validity? Why stick to 28 days?

6. TRAI must intervene to regulate operators to offer all kinds of bundled, standalone, minimum offers to customers which treat voice and data at par. For example, one shall have a choice to either prefer more data or prefer more talktime as per their need. One shall have a choice to go for ‘data only’ packs to retain a number etc.

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