Tata Tele becomes 4th largest operator

Tata Teleservices crossed the 75-million subscriber milestone to become the fourth largest telecom operator in the country. Airtel, Vodafone and Reliance have over 100 million wireless subscribers.

Tata, which launched its services in 2005, reached a subscriber base of 76.9 million after it added 2.1 million new wireless subscribers in August.

Tata Teleservices recorded a steady growth in its subscriber base over the last one year. In July 2009, the company had 38 million subscribers when it was offering only CDMA services under the brand name Tata Indicom.

The rise in subscriber numbers followed the launch of of GSM services under the Tata DOCOMO brand — a joint venture with Japanese telecom major DOCOMO. The last one year saw the TTSL subscriber base grow more than 100 per cent.

The services launched in August 2009 introduced the ‘one paisa per second’ pricing. A number of telecom majors followed suit by reducing their rates.

“It seems Tata has used pricing as the main weapon to get more subscribers. And the strategy has worked. In terms of profitability and average revenue per user it could be amongst the lowest in the industry,” said Harit Shah, research analyst, Karvy Stock Broking. Analysts also said the company has planned to tap subscribers by under-cutting prices to get a substantial subscriber base and then look at increasing revenue.