I have been in email contact with Mathew Carley; the owner of Hayai Broadband and he has a lot to say on the prevailing scenario. Needless to say, though he is aware of the crippling issues that face Indian market, nevertheless he has innovative, out of box ideas for the same. The following is the text of the email quoted verbatim (and the links here in point to his Linked In profile. He can also be followed on Twitter here, here and here).

I wrote, ” Nevertheless, I have also wondered as to how you would “create” demand for the product. To me, the incremental cost of owning a PC is always a stumbling block. I have advocated Open Source and in recent times thin client model (Novatium comes to my mind) as a possible solution. BSNL has something on these lines but I have not been able to confirm this from the local office.” ( My earlier write ups on this issue are here, here and here; but they are way too old! )

He replies, ”

For those that can’t afford to buy computers, I’ve had the idea of basically setting up a similar system to that which is found in Finland. At public libraries, there are 10-15 computers available for public use.

To use them, you must have a library card which you put in one reader, and it spits out a queue number. When your number comes up, you are assigned to a particular computer automatically. You head over to the computer, insert your card in to the card-reader, and it’s yours to use in English, Finnish or Swedish for up to 15 minutes at a time. Oh, and I should mention: the whole lot is running on Linux! It is absolutely fantastic.

In our case (particularly for rural India), I imagine we would set up something akin to a cyber-cafe – prepaid cards, probably printed with a barcode, ID photo and accessed with a PIN code. Money would be deducted per 15, 30 or 60 minute session. The facility would have generators and alternative energies (solar?) supplying the power during the times when the grid is unavailable (or non-existent). I expect that we could run 10-15 thin-clients off of a single LTSP server and be relatively efficient, fast and secure, and the generators then only have to provide less than 1 kilowatt of electricity to keep the center going.

For cheap computers, there are a number of companies in India offering cheap solutions (not cheap enough) – one company’s products did look promising until I found out the price for his devices (between Rs10k and 15k!!!). Ideally they need to be as cheap as cellphones – I think not more than Rs5k may be acceptable. Then the question would be connecting these people. There are numerous options, but it would definitely be a situation of “lesser of multiple evils”.

I asked,” What is the cost of laying optical fiber in the country; is getting the ISP license “cheap”?

He replies,

“With regards to laying optical fiber, it’s really a question of where. Currently there is no regulation as to the pricing of laying fiber. In Mumbai it can cost anything from Rs50 lakhs to Rs1 Crore per KM to lay fiber, or to utilize a 1Gbit/s port on existing fiber to a single neighbourhood can cost around Rs15lakhs per year. In other parts of the country however, this amount can drop to Rs1 lakh per kilometer, which if that happens to be in a built-up area, can mean that we can provide excellent services at decent prices.

Let’s take Panipat in Haryana as an example (chosen at random). The city has about 2.7 lakh people in an area roughly 4km across, 10km tall, giving us an approximate coverage area of 40sqkm (About 7% the size of Mumbai). Assuming plots to be an estimated 15m wide (judging by a rough look on Google Maps), we can say we’ll fit about 66 houses in to each KM of fiber. Let’s assume Rs10 lakhs per kilometer, which is a cost of about Rs15200 per house, assuming each house is a low-rise/bungalow.

Generally speaking, the life of the fiber is expected to be 20 years (aerial) or 30 years (underground). At this price, the fiber can pay for itself in 5-8 years depending on how much we charge for it and if we end up leasing it out to other providers. At the prices we charge currently Mumbai, (We have a base price currently of Rs550 including taxes) will mean that it would pay for itself in about 3 years.

This is the end of part I. I would be covering rest of the email and the interesting exchange of ideas in part II soon.

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“Instead of looking at the call records of a single customer at a time, it looks at customers within the context of their social network. The ability to retain customers is particularly important in hyper-competitive markets, such as India. Bharti Airtel, India’s biggest mobile operator, which handles over 3 billion calls a day, has greatly reduced customer defections by deploying the software, says Amrita Gangotra, the firm’s director for information technology.”

If anyone of you piss crap dip shit idiots is reading this, sorry to say but you are betting on wrong horses. If IBM has sold you expensive software, it has ROYALLY screwed you. Numbers make very good presentations, Airtel. If you are trying to bring in some generalization in the heterogeneous market, you are falling flat on your face.

Airtel, may I remind you that you have not become the “preferred mobile operator” because you are good, but because in most of the cases, people have no REAL choice. If facts speak for themselves, please lay out the exact number of subscribers in your network, your network utilization, the number of actual post paid customers and how you cheat the crap out of people on prepaid networks.

Your Broadband business is best in terms of service but stunted because of POOR REACH and you dumbfucks have not been able to add on ANY value to it. All your marketing muscle has failed. Even when I switched over my circle, your retention team was unable to convince me to stick on to Airtel. It is so bad.

I am a customer; you got to kiss my ass and not other way around. A fancy piece of shit with hired dumbfucks is not going to change the perception. Unfortunately, you tend to ignore the hugely vocal minority spilling out their venom because of your shoddy services while you are busy palming off a huge majority of the dumb fuck retards. Sad, very sad.

What really is required is to shake off the lethargy, spread your broadband network further, cut down on the crapware you’ve bought and kick out those fancy moronic MBA’s who don’t give a shit to your brand. Start listening to your customers. Trust me, you don’t need to look for “computer generated patterns”; but make the existing mode of services to deliver their maximum value.

It would pay off more than you anticipate.

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Beh

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Mobile tarriffs are supposed to be the “cheapest” in the world. Agreed. They are indeed cheap as compared to the dollars abroad. It still doesn’t make any iota of sense to extrapolate the Western data on to a third world nation. We are billed on a per minute basis; I am told that per second billing would perhaps introduce a lot of complications in the billing. Imagine the huge amount of unused minutes the companies earn when someone talks for just first 5-6 seconds of the minute.

We are mired in the regulatory maze, the final authority being vested by the babu drawing his/ her own ideas about the regulations without taking care of the customer’s interests. The companies have opaque ownership patterns, foreign investors are playing havoc with the security, a free for all access being awarded to Pakistanis and Chinese of all hues.

Broadband is still stuck in the “faster than a dial up mode” and for all the brouhaha about the long distance rates falling, the pulse rate on the calls has decreased considerably which more or less makes up for the lost “usurious” call rates of yore. We still pay the jazziah to the sarkari motherf*****s without any respite.

All these facts are swept under the carpet.

Mobiles indeed have been the forefront of the social change. No second thoughts about it. However, I’d be clearly betraying my class conciousness when I’d say that even a rickshaw puller has a mobile. Riding on the upfront costs as ‘administrative charges’, I fail to understand the value it creates. Even with a huge prepaid user base (most of it cooked up and riding on fake connections), it has failed to provide a succour to the common man as technology enabler.

Presently, most of the companies are relying on so called “value added services” to drive their revenues. Hand in glove with the media, they are creating specific niche of programming which entinces the people to loosen up their pockets. While it may be argued in terms of matter of choice and smart marketing, I do foresee a nation on mentally retarded idiots who are stuck in the old groove of being “good for nothing”.

Why does India’s demography excite the marketeers? Don’t you realise that our growing population is going to be a frigging nightmare of monumental proportions? Even if you are a die hard believer of Malthusian school of economics, the eventual downfall is out there in cold. Mobiles cannot be sold to half dead, naked, out of work populace. Which is indeed the story of today.

Presently, as per the estimates, 40% of the Indian land mass is covered. I don’t have the means to verify because I guess this ‘information’ is classified. Rural areas are still out of the ambit of any decent coverage and as I have argued in these columns ever and ever again- Internet connectivty shouldn’t be wireless.

Before I conclude, I’d like to quote from a write up that appears in The San Jose Mercury News link from Atanu’s write up)

“In the next five years in India, nobody is going to get a land line,” said Sanjay Swamy, a former Silicon Valley executive who is now chief executive of mChek, a Bangalore start-up whose software allows people to use their cell phones as credit cards.

Wow. We could give this idiot a benefit of doubt. Of course.

Even if we have fabcrication units in India, the next Intel/ AMD isn’t going to come out of India. You could have low end ‘assembly plants’ here and no one in their right minds are going to send across the plans for designing the next “dual core” crap.

Life is mean bitch. Sadly some people tend to forget that.

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Of course, it wouldn’t be affecting the execs in their plush offices because it is the deceit that keeps them comfortably on their asses. During a routine criminal investigation in Haryana, the police discovered huge number of connections in a single person’s name. After further probes, they discovered that a number of telephone connections had been booked in the name of fictitious entities. In simple lay man’s terms it means that anyone could potentially “misuse” the phone numbers without the fear of being traced.

The Haryana police booked a couple of Airtel employees and it took considerable resources (my guess) to avoid a PR disaster for them. The whole matter seems to be subdued and suppressed and talked off only in hushed up tones. It is not getting the attention it deserves. By rough estimates, if the proper physical verification takes place now, it would shave off one third of the numbers which the companies gloat about. No wonder, Ramachandran, COAI chief, is keen only for the random verification of the subscribers. They cite huge logistics problems for the same.

This has grave implications for the internal security of this nation. In the name of driving up subscritions and ramping up subscribers, the norms have been thrown out. It didn’t apply to them in the first case either.

Getting a pre paid is simple. One has to furnish a “proof” of residence/ photgraph. That’s it. No questions asked. The “verification” is done at the level of the shopkeepers who is supposed to know the local residents. A little “consideration” and things get rolling for a new connection. Prepaids cannot be traced to the original subscribers and the SIM card can be destroyed and a new one had.

Post paid norms are tougher and no wonder, I get to hear delays on the part of the companies to verify everything at their end.

This wouldn’t be solved overnight and is a clear cut violation of licensing norms. Why haven’t their licences been cancelled?

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Broadband would have to wait till July end (tentatively) and the Mbps plans are no where around the scene. My “mole” in Reliance marketing office was at pains to explain to me about the “speeds” on dial up. Imagine. I could have puked there but held myself. He even claimed that video conferencing was possible on 256k line.Reliance isn’t getting any “talent” and they picked up the “smartest of the morons” available.

I wonder whether anyone from Reliance is reading this. If you have such employees who bull shit their potential customers, you are dead as a dodo. Specially the customers who blog.

September is the probable slated launch for Reliance’s Blue Magic or DTH service. I doubt. There hasn’t been much activity on ground as yet. Would Reliance appoint dealers to scale up? If yes, there should have been advertisements in the newspapers calling for the same. None. The existing Web World properties are now creaking. With peeling paint, broken chairs, crashing PC’s (running Windows- what else!), the only thing that is missing in web world is the smell of sweat and urine. And the web worlds lack any space for expansion to cater to the expected increased demand for Blue Magic. Anil Ambani would either have to appoint third party dealers (leading to mismanagement of the customer’s expectations) or scale up independently via company owned showrooms. This would obviously lead to duplication of costs.

DTH is a holy cow untouched by regulations and only dominant player in India is Subash Chandra’s Dish TV. There is a lot of bitching about the Digital Video Recorders (DVR’s) and their hopeless quality. However, this is a virgin market and the players are milking it for all it’s worth.

DTH needs a seperate post though.

Reliance would need all the marketing muscle it can muster to make it happen.

Finally though, Reliance is loosing it’s sheen. It may have the numbers (trumped up mostly), but this is backed by opaque clauses, absolutely nil transparency and billing glitches galore. The biggest drawback is to “outsource” the “core” billing collections to third parties who leave no stone unturned to make the experience as hell.

In my opinion, Reliance has to fight the perception of a company which doesn’t care.It is definitely a tough call; rebranding exercise or not. An ageing star brand ambassador cannot do anything about it.

(Update:This is edited version of what appeared earlier on in the morning. I was at the mercy of my electricity company and had to hurriedly “save” the post). Apologies).

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Coming at the heels of a frustrated customer of Hutch there’s another personal experience with Reliance.

Reliance Info is one of the largest pan India CDMA players. Yet, they don’t gurantee adequate customer service. I had a Reliance handset which I got frozen because I wasn’t using it. True to their style, they sent across a bill for consolidated 4 months. Imagine, during this period, I didn’t even switch it on!

When I had been to the Reliance Web World Express, there is saw frustrated customers with their billing complaints. I did manage to get some insider information- Reliance is facing a major hassle with billing systems. What system they operate on or why they haven’t upgraded it is beyond me. During a half hour interval that I was there, there were atleast 4 disconnections from frustrated customers. 4 disconnections.

I only highlight this so that the real nature of the “telecom boom” is apparent to the world. It beats the common sense to spend such a huge amount in marketing but customers have no choice except to stick on to extremely degraded customer care.

In another blood curdling incident, a long standing customer of Reliance was abused because he dared to correct the Reliance Web World staff. He could have created a mayhem himself but realising his duties as a concerned citizen he sought to complain and put up his complaint online.

Here iswhat he has to say:

I am a customer of Rel. Info. for past 2 years and have 6 landlines and mobiles for past 2 years. Throughout that period I have recommended your services to near and dear ones.

I went there to get my POST PAID mobile connection migrated into “LIFETIME PREPAID”. On expressing my desire I was handed over a form and asked to deposit a sum of 991 Rs. which I did. While filling up the form (and seeing the postpaid-plans) I queried that the form is for LIFE TIME PREPAID, at which the lady exploded. She openly said there is nothing called lifetime prepaid thing for postpaid subscribers.

I told her you have to inform me about it… she started blabbering and made fun of my know-how in front of all customers and staff for 5-10 minutes.

This is what they do to a long standing customer in their outlets. Who would want to get insulted by this kind of a staff? Reliance surely needs to buckle up. Or else, they would get panned out in no time.

I highlighted these two incidents because it makes no sense to keep quiet about them. The Tribune regularly carries out customer complaints against non payment of refunds or illegal dues on the post paid bills. Now if they care to look online too and see for themselves- there is a huge customer base that simply doesn’t have the “delight” of using a mobile telephone. Or even broadband.

I would be glad if any of the Reliance’s official spokesperson clarified. I would carry their version too here.

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Airtel introduced the prepaid voucher, thus raising the stakes for others to follow. Within a span of two weeks, all others had “me too” schemes. The last (and laggard as usual) was BSNL. It was indeed surprising that it took it’s CMD to announce the scheme. It just shows the kind of importance that they have attached to it.

Now, how do they plan to make money? Simple. They would get the call termination charges from other networks. Albeit they are planning for a low margins, high volume game. However, the outgoing call charges are nearly double of other packages; simply because they have no other means to recoup their investments.

Why the “incoming for life” then? Scaling up customers for spectrum allocation. Simple. Though Tata’s were motivated by absolutely nothing to show off in their accounts. It was then vehemently opposed by COAI (the trade body of cellular operators) who termed it “ILLEGAL”! Well, why then they have eaten their own words? It’s called as “foot in the mouth disease”. According to TRAI’s norms, this scheme is valid for 3 months. Tata’s are nearing the end of the tenure for the same. The game has just started off for GSM fellows.

High outgoing call charges are seriously a dampener. This defeats the purpose of “low paying customer”, or affordable mobile. Still, as companies go on an advertising binge, they violate the advertising norms without disclosing the intended costs or the churn on the acquired customers if they fail to recharge.

Haven’t we seen this happening before?

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My travails started when my trusty Nokia handset went kaput. I believe, my dog had a role to play in it. Specially when he just revels in chewing it to bits. It outlived all the horrors subjected to it and one fine day it just went dead like a BSNL landline. After frantic efforts, I managed to get it powered on and retrieve my address book. That was when the whole issue came in focus.

For long, I have bet on CDMA; never faced any issue of congestion or call drops. It is one of the cheapest mode of communication while roaming. Thanks to Reliance’s widespread reach. Plus of course, rock bottom tariffs and simplistic plans. I was a satisfied customer. However, it was a BIG issue when the GSM phones started their marketing onslaught. Ring tones have been a BIG hit in recent times. Reliance favoured poorly. Then finding a Reliance customer was statistically insignificant. Almost everyone I knew has GSM phones. Another factor that weighed in prominently was the free SMS. For a nominal amount, I could go on a messaging binge. SMS definitely is expensive in Reliance.

I mustered up enough courage to explore the various possibilities. Airtel has a crappy office in my city; minimal attention to details and none of the “executives” seemed to be interested in spelling out plans. I gave it up in disgust. Hutch has excellent showromm ambience with pink splashed over. I have no idea as to why are they obessed with the pink tongued pug. However, I wasn’t happy with the way the plans were communicated. The person telling me didn’t have any clear idea as to help me to choose plans according to my needs. Hutch seems to have a lot of hidden charges; postpaid to prepaid migration is a pain in the wrong place. Hutch too ran out of contention.

Argubaly, BSNL has the cheapest GSM service. However, I am not a brave person; I decided not to explore the government service at all. There are enough stories doing the rounds that SMS’s move at snail’s pace. Clearly, BSNL is a company stepped back in time.

Finally, I settled in for Spice. Perhaps, it was the discounted “corporate” scheme which made calling within the group free of cost. Further, discounted calling rates to other mobiles and SMS pack. It comes with all the frills what the “rivals” are offering.

Still, the big hassle is multiplicity of plans. If the GSM operators need to be taken seriously, they ought to have policies in place to communicate effectively. Including trained personnel who have the ability to spell out everything clearly. I was absolutely aghast when the Airtel “executive” claimed that GPRS speeds touches 115kbps. Well, no point in arguing about the “ideal case scenario”. But then, they did palm off a sucker who wanted to invest in mobile wireless.

There are enough of them to keep the companies in business for a long time.

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While it is perfectly justifiable for any business enterprise to make profits, the companies seem to rely only on one dictum. “The ends matter, means don’t”. In this scenario, we as consumers are mere fodders for their extravaganzas. Over and above the fancy salaries and huge spread outs, these companies are forgetting to place the customer first.

1) The billing related complaints top the number of complaints.

This is because this is the most tangible aspect of the company’s efficiency. Month after month, notice that how they charge for “misscellaneous expenses”, “plan charges”, “charges for Calling Line Indentification ( which is infact free for them anyway) and what not. The worst hit is the prepaid segment- where in, debarring the time when the promotional offers are not running, half of the talk time value of the card is taken upfront. Obviously, there is no break up of the costs apart from the taxes and “administrative costs”. It is surprsing that despite the technology for e recharges, which would amount to significant cost savings, it isn’t promoted. So, one has to pay for the inefficiencies of these companies- with the cost of the logistics and the distribution costs including the paltry dealer’s margin.

2)You cannot hold any company responsible for call drops or the way they bill you.

Traditionally, they charge you on per minute basis. Even though you may talk for,say 20 seconds, you have to pay for the unused 40 seconds. I took up the matter with the call centre people. Their response was, take it or leave it. It is the company’s policy and one cannot do anything about it. Well, as a customer, you have the right to be heard. When you saw the advertisment, the star couple or the star batsman didn’t even utter a word about how you are going to be billed for the calls. There is no respite for us in the coming future.The only way out is the per second billing which is more transparent.

3)Different plans seek to confuse the consumer rather than make any sense.

In the hey days when I started tracking this industry out of sheer curiousity, it was easy to follow because there weren’t many players. However, as the number of subscribers grew, it became increasingly clear that different segments of the market were required to be approached differently. Thereafter started a deluge of the plans. One after the other- it was tough to find out the hidden costs. TRAI wanted to inject some sense in the madness- they failed to evolve any reliable methodology for the consumers to choose minus the fine print.

4)Roaming rates are among the highest for the GSM players. Till to date, they haven’t evolved a transparent mechanism to calculate the costs involved and communicating the same to the consumers. Reliance and now Tata’s are trying to bring down the roaming costs. Yet, I feel, there is much to be done.

5)Have you ever tried to get your complaints sorted out through the customer care?

There have been many instances of the readers penning down their experiences with the customer care- which is designed to be more opaque than transparent. It takes a lot of cajoling or even threats to make them work. Geting the information is an exercise in patience and ingenuity. Barely out of college and underpaid, with absolutely no loyalty towards the company they are working for, it reflects in their attitude and they way they present themselves.

Of course, getting a new phone connection comes with absolutely no gurantee that it would work the way it has been advertised. For example, as a Reliance customer,I cannot exchange SMS’s with a BSNL customer; nor the picture messages come through. It wasn’t mentioned in the agreement I signed on with the company about the deficiency in the service and their lack of interconnect agreements. Similarly, BSNL’s SMS has become the butt of jokes- once sent, forget about the delivery in that instant. Wait for the festive season and you would find that the networks have jammed with the messages- clearly the opertors are not prepared to handle that load.

I salute the Indian customer’s resilience.

This can be only changed if you stand up for your rights and demand what is due to you and what you have paid for.

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It seems that GSM majors are keen to paint themselves as the suffering party rather than accept the fact that they have lousy networks. Part of the reason is the GSM protocol that just doesn’t really work. It not only uses up the scarce spectrum resources but inefficient too to roll out. I have no idea as to why people remain fascinated by GSM.

Anyway, GSM majors fear back entry by CDMA Operators With Reliance getting agressive, it is matter of time when the bloodbath spills out in the corridors of power. Fact is that spectrum is a scarce resource and GSM majors need to hop on the untested 3 G hoopla. Partly I believe that the equipment manufacturers are goading these people on to shoot from their mouths that 3G in the in thing and the “next generation” mobile network; bringing world class infrastructure to India.

If I am not mistaken it is on the verge of being phased out. 3G services may remain also ran here. More on that later.

Another news report says that Reliance wants to slash handset prices Expect a flurry of announcements. They have perfected the volume games and expect flurry of customer addition in the future. Way to go Reliance. Frankly, this is what is required for Indian market. They are planning to slash the handset prices to Rs 1300 and below. If and when that happens, they are going to see a massive influx of new customers from the rural areas. Wait and watch this space for more on that.

Idea Cellular cuts prepaid tariffs which by in itself is a good news for it’s subscribers. I still hold that there is a potential for further cut in the tariffs if and when the ADC component goes and perhaps the operators get “less greedy”.

Where is the truth behind the numbers? The Association of Unified Telecom Service Providers of India (formerly ABTO) claims thattheir subscriber base grew up by leaps and bounds Economic times that carried this focus again fails to justify as to on what basis these numbers have been calculated and how do they justify the number in “lakhs”. Is there any way out of this mess? Clearly, this is Paid For Media Exposure

Finally, BSNL is wising up to the threats of either being sold out or survival instincts in the jungle. It has announced plans to scale up the capacity by another 40 million lines Hopefully they might consider better customer retention and increased focus on changing the mindsets. Frankly, BSNL is equated with a seedy office with a worse screwed up brand equity. They might consider to bring about a change too.

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Last week I went to pay my bills for Internet phone taken from BSNL. It is the same argument I have to face repeatedly. As a customer, why do I have to suffer a lack of choice? I do feel cheated time and again. The worst is that I feel helpless each time. The telecom policy dreamt up a hope that we would be able to see a multitude of companies, each falling over each other to serve the customer who is a king. Bah. More than a pauper, I am reduced to nothing. Be it invasion of my privacy, getting those unsolicited calls or ignorant army of morons as customer support staff; I do not think so that I got what I actually deserve for my investment in the services.

The worst-case scenario is for broadband. This is indeed taking ever and ever to materialize. BSNL did launch its broadband. However, I am wary on their past record for customer care and the quality of the infrastructure. It is true that people have started complaining about the poor quality of broadband due to line disturbances. I have always maintained that it is easier to wake up a person from his deathbed than getting anything done out of the so-called customer care.

However, in advertisements I am promised the earth. Sachin Tendulkar has endorsed Airtel brand. How does he being featured in the same get me better quality of services? I remember when I was their customer couple of years back. My folks could not get through my number. Repeated complaints to the customer care made no change. Finally, I had to shoot a letter all the way to their head office. Belatedly after about a month, some dingbat chose to reply in the usual corporate tone. The same kind of language that they choose to advertise. World-class infrastructure? After much haggling and repeated calls, the fault was traced in their switch! So much for their intelligence. This gave me an insight in the way call centers worked. After making repeated calls, I was on friendly terms with some sensible people. Admittedly, not all are dumb. Some are bit more professional in their jobs. I have to know their problems and the way companies chose to deal with their customers. Dude, they said. Prepaid card? Forget it.

Internet remains a bugbear. I need Internet to keep myself abreast of what is the latest in my field. However, the high cost deters me to surf with peace of mind. If at times I am able to get a decent connection speed, the line drops in the middle of a download. Things have changed for the better in the past one year. Earlier it was a harrowing time to connect to the exchange. Often it took me a dedicated patience of about an hour or so before I chose to give up. What of the wasted calls? It profited BSNL in any case.

The other day I went to pay mobile phone bill for someone. I was astonished to see the various kinds of charges that they had levied. This was a GSM phone and the company had charged astronomically for roaming charges. It seemed strange that how can Reliance charge a pittance for the same. Having ones own network is imperative if you have to succeed in the telecom market. It also hinted at the way the GSM operators have ganged up to charge excessively from the customers. Any “arguments” with the bill collection agencies is futile.

The worst-case scenario is the invasion of privacy when GSM customers get unsolicited calls. There have been reports of people buying a brand new number and within a few hours, some moron is offering a credit card from a bank. This only exposes the fact the companies sell the numbers. In this case, they could have alerted the calling agency that the given number is activated. This is not a confirmed fact but it is possible, given the trend here in India. I would suggest that one should avoid handing out numbers in public places. Invariably it finds its way in the databases that can be had for a song.

I really wish that things improve. TRAI is supposed to be a regulator. Why hasn’t it stepped in and said that enough is enough? The recent Gartner report has mentioned that telecom has grown from strength to strength but the last mile connectivity remains pathetic. What of the last mile Sir? Come on in and you would realize that getting a telephone line from government provider is an exercise in patience. If you are willing to swallow your pride and ready to be insulted, well then you can have a look at what broadband means here. One thing that they were absolutely right about. The report mentions clearly that quality of services remains much to be desired. This is what I had mentioned in my earlier posts too.

Established players like Sify call their pathetic lines as broadband. With the absurd data limits of 300 MB, Airtel is offering the “lowest priced” broadband. 300 MB for what Mr.Mittal? Opening up my browser and closing it down? What possible Internet surfing could I do in 300 MB without you ripping me off in the process? Why be so absurd, guys?

I believe that it is the hangover of the past when the powers that be handed out favors because they wanted it to be that way. These people have created artificial scarcity when there is none. Plan a decent connection and sell the product. We customers are ready to pay for something good, Sir! Provided it is reasonably priced, assured services in the event of downtime and go that extra mile in ensuring that your customers remain happy. Does that take too much? Nope. It takes only a little effort on your behalf.

Discuss on: Sify Broadband, Tata Indicom, Airtel Broadband, Reliance Broadband, MTNL – BSNL Broadband, Dial Up, Others

This post was submitted by Dr. Abhishek Puri on the Broadband Blog on Techwhack.

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Sunil Bharti Mittal must be a happy man by now. Hailing from a small town in Punjab, Ludhiana, he has achieved in life what some people dream of. He was a push button telephone manufacturer until recently. It was the winds of change in the telecom sector, which really propelled him in the national limelight. However, Airtel has its own share of bloopers, which are clearly not in the public domain. I shall try and lay out a case as to why their practices are not in the national interest.

There was a cover page in Business World magazine recently whose title said “The man who gave up his network away”. It was clearly unprecedented step in the telecom sector anywhere in the world. Network is one thing that is sacrosanct to any owner. However, in a smart and clever move he did that which could fetch him a lot of savings. I am not going in the details of the dealings or the pros and cons. This is clearly a business move, which he knows best. My only concern is the overwhelming presence of the multinational corporations in the sector and such crucial as this one.

There are two main issues here. In my earlier post here, I had mentioned as to why FDI has not really changed the telecom scenario. More money for expansion invariably comes at the cost of risk to other operators. I shall go in that detail a little later. The overriding concern is the technology that would be used for the switches and telecom equipment. I read in Rediff article recently that low cost equipment is feasible as of now. If we talk of partnership between the academia and the industry, then this would have been a golden opportunity to reclaim our investments in IITs across the country. I am sure that spurred on by the demand they would have come out with some solution. Thus, save the precious foreign exchange. It is clear that overwhelming presence of the MNCs in the sector would clearly benefit their host nations. A poorly thought of strategy indeed, to increase the FDI.

The second crucial aspect is the security. I have a reason to believe that Singapore based companies are actually a front for the Chinese government. Thus, surreptitiously they are entering this sector. Why the mandarins sitting high up haven’t really thought of this at all? This is beyond any logical conclusion. I have opposed FDI on this very ground because these are ill prescribed prescriptions of the donor agencies. The so-called security measures announced were good enough to keep the Left shut up their mouths. Not that these people are not nationalists. The very idea or the foundation of their beliefs is flawed and outdated.

However, the biggest beneficiary has been Airtel after the increase in the FDI. They have realized, although belatedly, that value added services is the way to go. There was one major flaw in the roll out of the subscribers. To ramp up the numbers they concentrated mainly on the prepaid subscribers. The health of any telecom network is determined by the number of post-paid subscribers it has. To correct this they have started resorting to monopolistic tactics. The GPRS subscribers on the prepaid networks can only access the Airtel Live portal. In case they wish to download anything, a hefty charge of Rs 10 is charged per request. This is clearly anti competitive and goes against the established logic. Of course, a better way could have been to introduce a recharge voucher for a fixed monthly fee in case one wishes to access the GPRS and thence Internet. This forces the people to shift to post paid segment where the ownership costs are much higher.

Airtel has invested heavily in building up its brand. However, despite the greatest cricketer of our times, their advertising pitch does not enamor me. I believe that Airtel had consistently fallen behind the TRAI’s parameters in terms of quality of offerings barring a few circles. Hence, the newer ad pitches of “stronger and clearer” network.

The fixed line business is imperative for growth. As I had mentioned, increased funding would now mean that it needs to acquire operators with fixed line business. One that comes to my mind is Connect from HFCL in Punjab. After a relative lull in the roll out of services, it has suddenly woke up to ramp up subscribers. I was surprised to see their advertisement banners recently. Perhaps it could be because of entry of TATA in the Punjab circle. I have a feeling that HFCL wants to ramp up numbers and sell out. As it is, they have a lousy service and customer support in the after sales services. Airtel would want to pick up this stake for good because it does not make any business sense to duplicate the entire infrastructure. In any case, there is not room enough for another fixed line operator given the fact that Punjab has BSNL and Connect offering their services.

It is interesting to note the recent news that was reported in the media. On the announcement of the unified licensing regime, any operator who wanted to have a fixed line license was allowed to pay the migration fee. Airtel slapped a notice on the government asking it refund the same after the second round of policy changes were announced. It was clearly pointed out that fixed line license was voluntary. Airtel could have waited for the same or forego this amount. Is Mr. Bharti keeping his idle legal department busy? I am looking forward for the judgment.

Before I end this post, as the events have unfolded I have a hunch that Mr. Bharti would want to sell out his stake in Airtel. That explains his recent diversification in selling vegetables. It is clearly an untapped market and would go a long way to improve the best agricultural practices. I wish him all the best. The main reason is that despite all his ills, his was the first network that got the mobile network in India. How he pulled it off is another story.

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The way telecom firms advertise, gives an approximate idea about the telecom trends. I would try to uncover some of them, which come to my mind. At the initial launch of the mobile services, they were advertised as lifestyle products. The message that sought to be conveyed was that if you have a mobile phone, you have arrived in life. A few well-healed people could afford the high call rates at that time. It was in no way for the masses. I am sure that the mobile companies made a large profit out of it. Perhaps for the first time, Indians were exposed to concepts alien to them: Customer Care Support. It saw a booming of the ancillary services and fresh graduates, stunted in mental development though, came out in droves for the well-paid jobs.

Airtel then sought the services of Sachin Tendulkar. He was the brand ambassador and saw his earnings sharply increasing. I saw his picture everywhere exhorting me buy the mobile prepaid card. After the initial publicity passed away, A.R. Rahman gave his now famous tune. All the other companies have variously tried other gimmicks to sell their connections.

However, the landscape changed after Reliance came in the mobile services. Mukesh Ambani was seen telling people about his fathers dream. The initial launch was lackluster. With the launch of the prepaid services, the punch line was “mujhme hai who baat” or “I have that thing!” I wonder how many people actually signed up after those ads. I believe that it was solely because of the “Monsoon Hungama” that Reliance was able to ramp up its numbers. Then came the ad line “Kar lo duniya muthi mein”. (Have the world in your fist). I remember that this became the butt of dirty jokes on the GSM networks! So much for imagination of creative heads of the ad agency.

The icing on the cake goes to Hutch. They designed the simple ad with the kid and cute Chinese Pug. It was a hit of all sorts. It conveyed the effectiveness of the message succinctly. I believe that it drove Hutch’s connections across the places where it offered its services. However, it was considered too elitist for the masses. The advertisement should be able to convey the message effectively; one with which people could identify with. In this regard, BSNL could claim something. BSNL’s advertisements depicted typically government mentality for awarding the contract to lowest in the tender process. The quality clearly shows. Is there anyway people could identify themselves with that advertisements? What of those places where BSNL is the sole service provider?

As the title goes, advertising trends are reflective of the current scenario in telecom. Airtel has been advertising its group card labeled as Friends. In fact, until now, the market was treated as homogenous. Over the period, classification has been sought to target the specific customers with specific needs. Airtel took the lead in announcing Senior citizen cards targeted at those above 60. The “Friends card” is for those who wish to restrict themselves to their group with low calling rates and some free messages.

Reliance has realized early on about targeting the businesses. Its offer of flat rate for making STD calls to anyone across its network is unparalleled. This way it can ensure that there would be higher converts towards it services. R-Connect is its portal that differentiated Reliance early on from other operators. It knows that future revenues are going to come from value added services. This way it has foreseen the development in the industry.

Following this, Airtel introduced its Airtel Live! I guess so have the other operators across board. The voice calls would not yield much as much as revenue as would the value added services. Hence, for the same reason they have introduced value added cards, which would help to download ring tones and other fancy stuff.

This is the reason I have always insisted that Telecom operators should get bullish on data services. 3G mobile services look good as technology demonstrators. Until the time, the prices for the 3G enabled handsets fall down to manageable levels, it would not take off. I believe that it takes up a large chunk of the scarce spectrum, which does not make any sense to introduce. WAP and GPRS were heavily promoted but have been more or less non-starters. The real differentiator would be the quality of services, cheap offering if these companies have to venture in the rural areas and the reach of the network.

In this regard, the division of India in circles is not in the right spirit. It should be taken as a homogenous land mass. The day is not far when it would be local call to call anywhere across the nation. Reliance has made this possible to some extent.

Discuss on: Sify Broadband, Tata Indicom, Airtel Broadband, Reliance Broadband, MTNL – BSNL Broadband, Dial Up, Others

This post was submitted by Dr. Abhishek Puri on the Broadband Blog on Techwhack.

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