Kolkata sees least mobile penetration, telcos strategise

With Kolkata emerging as the least mobile penetrated city compared to other metropolitan cities like Delhi, Mumbai and Chennai, telecom companies are looking at a further drop in tariffs, better infrastructure and tailormade offers as some of the ways to increase subscriber base.

Mobile penetration is the number of mobile phone subscribers as a percentage of the population of the city.

According to data from the Cellular Operators Association of India (COAI), Chennai has a mobile penetration of 111 per cent, followed by Mumbai at 90 per cent, Delhi at 83 per cent and Kolkata, way behind, at 67 per cent. The data is based on the overall mobile subscriber figures for the month of February, which includes both GSM as well as CDMA players.

The four metros are crucial because while they contribute for around 16 per cent of the country’s mobile subscriber base they contribute for around 25 per cent of the revenue for mobile operators.

According to analyst reports, the numbers reflect new challenges especially for the new operators who are launching services in these cities. They have only two choices either to churn away customers from other operators or ensure that consumers get hooked on to a second phone. However for incumbents also there are new challenges, like how to push average revenue per user (ARPU) which has been falling in the metros.

Abdul Majid, chief general manager of BSNL, said in a statement, for financial year 2009-10, the company’s target is to have a total of 4800 mobile towers. Besides, BSNL plans to introduce new products including PLB HDPE pile at Alipore. The financial target for 2009-10 is Rs 224 crore.

During the financial year 2008-09, BSNL’s captive manufacturing units situated at Alipore, Gopalpur and Kharagpur, made a record despatch of Rs 194 crore worth telecom products which is 42 per cent higher than 2007-08. Despatch of mobile towers had increased from 1697 to 2831, an increase of 67 per cent over 2007-08. As a measure to modernise manufacturing process, a new plant for manufacturing ‘jointing kit’ has started regular production at Alipore unit, registering turnover of Rs 3 lakh.

According to a spokesperson of Aircel, “The current mobile penetration in rest of Bengal (ROB) stands at 19 per cent. With our proposition to the customer becoming stronger with launch of value-added-services like GPRS, music-on-demand, CRBT, we will be able to get a significant chunk of high ARPU customers. This gives Aircel ample opportunity to expand its quality subscriber base with a positive rub off on Ebitda.”

According to Sridhar Rao, CEO of Vodafone (East), besides infrastructure enhancement, one way to boost subscriber base is to make consumers spend more.

“We have reduced our lifetime SIM cost to Rs 149 from Rs 999 three years ago,” Rao said.

Airtel, on the other hand, has introduced “My Airtel My Offer” that is expected to empower its prepaid mobile users to choose the best available product or service across tariff packages, recharge denominations, validity periods, value-added service and any other local promotional offer currently available on the Airtel network.

Raghunath Mandava, Chief Marketing Officer (Mobile Services), Airtel, said, “Based on the understanding of our customers' usage behaviour and further aided by technology and systems, this service has been developed which enabled subscribers to choose right product.”