Price War in Telecom Essay

Executive Summary Telecommunication sector is undergoing a transformation accompanied with rapid technological changes. New paradigms are emerging as telecommunication, IT and broadcasting industries converge. Advancement in telecommunications technology has brought about possibilities of new revenue streams for operators and better, faster and cheaper services for the consumer. Tata Docomo and Reliance GSM are the operators under this study. The basic objective is to study the pricing strategies and the absorption of the same by the consumers.

Also an attempt to comprehend the role of non pricing strategies was made. The Research methodology was dependent on primary data collection by the way of a consumer based survey and secondary research incorporating many research papers and information gathered from various sources. The consumers were divided into various categories to have a transparent idea about the consumer perspective. Primarily parameters such as the preference with respect to brand, importance of features of mobile communication and services offered by operators were given immense consideration.

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The data was collected via emails and online forms. In depth analysis of the data collected was done in order to come up with key aspects and observations. Out of a sample size 53 respondents’ divided into categories working, student and housewife/retire, maximum customers give importance to network availability of a particular operator. It is very evident that these two operators are below standards if we consider network availability. As per the data maximum people prefer Vodafone, Airtel and Idea. Further 89% of the sample size is reluctant towards changing the number to switch to another network.

This suggests that mobile number portability is a very major factor which all the telecom operators need to need to focus on. 81% are willing to use a common network to avail offers. This implies the benefit of closed user group plans which Tata and Reliance can work on. Further the primary modes of mobile communication utilised by the consumer are STD, local calls and SMS. This holds a major contribution towards introducing “per paise plans” and has been well adopted by TATA Docomo and Reliance GSM.

The primary outcome of the study is that inspite of introducing “pay per paise” plans and a lot many more strategies TATA Docomo and Reliance GSM is not well accepted by the consumers. Although their technology supports 3G network there needs to be more clarity about why these negative aspects are coming up. The other operators are performing better in terms of the all these and additional factors. Therefore once the 3 G network is completely established in India a lot of new options and better services for mobile communication.

Ours is a very large population with different kinds of consumers. Preferences differ in accordance with a wide range of parameters which can be increased to get a better image of the reality of consumer acceptance level of Tata Docomo and Reliance GSM. The study can further be extended to other mobile operators in the highly competitive market. Also the impact on average revenue per user due to the strategies adopted by operators is an important aspect. Considering all these different criterion will lead to a better perspective altogether.


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