Update 1: Airtel is marketing itself big with Twitter on SMS from Airtel. ( Tweeting is a lot cheaper on Airtel). Checkout their first youtube video marketing the same. A real good one.(“My Thumb just gave me 15 kms”).

The huge success of the first post in the series ‘Social Media Presence of Indian Telecom Majors-Facebook presence’ has excited us infinitely. So, as promised we are coming out with the second post in the series.

Twitter as explained in Plain English was meant to just tell “What are you doing?”. But the marketeres saw the Gold in it. It got used a publishing service and took the marketing world by a storm.

So, Today the microreviews team set out to find how the Indian Telecom Majors are utilizing this service. Microreviews team has already reported in one of its posts how the Indian IT major Infosys Technology closed a deal on Twitter.

So, Let us not waste anymore time and start off.

Airtel: Yes, Twitter is now available  exclusively on Airtel. But, really even at Rs. 1 per sms, tweeting from a mobile phone for those who donot want to use Mobile Internet Browsing is quite expensive. Twitter on Airtel is news, but is Airtel not being on Twitter not a news? Surprisingly, Airtel India is not available on Twitter. On searching twitter account for Airtel India, all we got were the accounts for Airtel’s calling card service, Airtel Champions League and Airtel Kerala. The twitter account of Airtel’s calling card service seems quite decent, engaging and answering people to some extent. But, over the neglect shown by Airtel India in using Twitter as a customer engagement and feedback service is appalling. Either, Airtel has missed the fact that India is already amongst the top 10 twitter using country or they they think that only NRI’s use internet.

Vodafone: Vodafone outside India seems to have taken all the right moves as far as social media goes. Vodafone’s Twitter presence and customer engegment in U.K, New Zeland, Netherland etc is brillaint. They seem to be answering every query which a follower and a possibly a customer has. Zoozoos and Vodafone complaints have a twitter presence too, which for me is brilliant. Vodafone India has however not started anything appreciable on Twitter. They have a Twitter account and that is the end of the story. Going byVodafone’s Twitter presence internationally, I do expect Vodafone to come up with a much more innovative Twitter campaign.

Tata Docomo: Tata Docomo has been a complete Social Media child to say the least.  If their facebook presence was good, their twitter presence is better. They seem to have put their best foot forward answering their followers, their customers. This for example is their answer to one of their customers. With over 2000 followers and brilliant usage of hashtags and other twitter terminologies, Tata Docomo seems to be leading the Indian telecom majors in innovative twitter marketing too.

Tata Indicom: Unlike Tata Docomo, which comes from the same TTSL group of companies, Tata Indicom’s twitter presence seems next to NULL.

Virgin Mobile India: Virgin Mobile internationally has done very well engaging people and answering them on Twitter. Virgin Mobile India also seems to have started tweeting but effective usage of Twitter from their side is still a far say. Their simply do not seem to be doing two way communication on twitter as of now. One way communication on twitter is as good as none, atleast for a corporate.

Reliance Communications: RelianceGSM seems to have a one way communicating twitter presence which is far from what is expected from a  company which hires Hrithik Roshan as their Brand Ambassador (spends enough to target youth). Their neglection of facebook and now twitter says a story in itself.

Idea cellular: There is an account by the name Idea Cellular but I seriously doubt if it is their official account. A company which targets youth was expected to be more active on Twitter for sure.

Aircel India: Another Indian telecom major which is trying to create a customer base but has neglected the possibility of doing the same through Twitter.

Having gone through the the twitter presence of the Indian telecom majors, Tata Docomo seems to be the only one which is using the medium effectively. I do not know exactly how the service quality of these telecom majors compare in India and if Tata Docomo does listen  to user feedback (we will come out with a post on that very soon). But the Microreviews team has not been too impressed with the twitter usage of Indian Telecom majors.

For social media help, I would recommend people to get in touch with Aditya Prakash and Prasaad K S on twitter.

You can also email them here and here.

Follow me on Twitter.

We are on twitter too. Follow us. Mail us here.

So, with all this in mind Microreviews set out to check the social media (the in thing as they say) presence of the major telecom players in India.

Let us start with Facebook.

• Bharti Airtel : There are apparently three or four facebook pages which Airtel has. One of these has around 10000 fans which is a big number by Indian Social Media standards. The page seems to have quite a few details of the offers coming out and stuff but doesn’t seem well maintained at all. The display image is of a person, who I really don’t know and I expected to see the Airtel Logo at the place of that pic. Going to the information section gives you a shock. It is apparently the page of Airtel Srilanka. The other pages of Airtel India also fail to impress and can be found here. Coming to facebook groups of Airtel now, they seem to be dominated by Airtel Srilanka again. The facebook group of Airtel Srilanka can be seen here and here. Both seem quite active. However, when I apparently go in for the Airtel India’s facebook group, they have got their website wrongly stated as http://www.airtel.co.in . It suddenly seems that this facebook group does not belong to Airtel at all. There are a couple of other groups, which may or may not belong to Airtel and can be seen here. I did find out a facebook game by name Airtel Special 5 and did not feel like taking it. Airtel Srilanka, overall seems to be doing better than Airtel India as far as facebook presence goes.

• Vodafone India: Internationally, Vodafone seems to be very active on facebook trying to engage users on the medium. Their Facebook pages can be seen here. Vodafone India’s page however seems a baby in comparison to their international counterparts but seems quite well maintained. However, the information provided in their info tab doesn’t seem to provide information about their social media presence elsewhere. Coming to the groups for Vodafone India. There is this one group which is again not well maintained and needs to be looked after better. Going by Vodafone’s social media awareness abroad, I do expect Vodafone India to take this up very quickly and get Vodafone India’s facebook presence to count. Zoozoos, in the meanwhile seem to have a decent facebook presence which can be seen here.

• Tata Docomo: Tata Docomo seems to have changed the rules of the games as far as social media presence of India goes. Their only facebook page seems every bit complete with everything presented in the best possible way. The facebook page seems professionally handled engaging the right kind of people. With over 1700 fans, lots of pics and videos, they seem to be engaging the people very well. Their info tab has provided information about all the social media presence they have elsewhere which is what it is supposed to do. There is no such group for Tata Docomo and to be honest, you need a good page and your  job is done.

• Tata Indicom: Tata Indicom’s facebook presence can be considered negligible with less than 10 members in their groups and pages.

• Virgin Mobile India: Internationally, Virgin Mobile’s facebook presence can be considered decent. However, when we look at their India presence, there is a lot of hope.

• Reliance Communications: For a company of the volume of Reliance communications, their facebook presence can be considered a big NULL. Either, they seem to  have completely neglected a medium as big as Facebook or they think Traditional media is doing the job for them.

• Idea Cellular: Idea Cellular has always been known as a major spender on youth influencing activities spending a lot on sponsoring College Fest, Youth Festivals etc. However, their almost non-presence on facebook left me in surprise. They have recently launched a facebook application which shows their entry into facebook in a big way. There is however, still some work to be done as far as Idea’s facebook presence goes.

• Aircel India : Aircel’s facebook presence can be considered as another near NULL and leaves a lot to be desired.

Having gone through the Facebook presence of the marketing savvy Indian telecom majors who spend millions hiring brand ambassadors and  putting up expensive hoardings, it is easy to say that they have been quite negligent of the power of Facebook as a major engagement medium. Tata Docomo seems to have done a very decent job at it and other need to learn quick.

This was the first in series of the articles which covers the social media presence of the Indian Telecom majors. Look out for the next in the series in which we cover other social mediums.

For social media help, I would recommend people to get in touch with Aditya Prakash and Prasaad K S. You can also email them here and here.

We are on facebook too. Mail us here.

Follow us on Twitter.

If there is one sector that is definitely over-crowded in India it is the Telecom space. From Tata to Aircel, from Vodafone to Reliance- all are locking horns against each other for a share of the Indian Subscriber pie. And in doing so they are taking the competition to a whole new level. A level of competition that can be fatal to them and the entire industry.

The phenomenon that’s taking place is also termed as Hyper-competition . 

“Often a characteristic of new markets and industries, hypercompetition occurs when technologies or offerings are so new that standards and rules are in flux, resulting in competitive advantages that cannot be sustained. In response, companies must constantly compete in price or quality, or innovate in supply chain management, new value creation, or have enough financial capital to outlast other competitors.” (Wiki)

Usually in an extremely competitive market, hyper-competition is started by a company which is new or has not much to lose but a lot to gain.

Background

The telecom business requires huge infra-structures and you don’t start generating profits from Day 1, in most cases not even after the first years. It is a business which takes time to bear the fruits. First the company has to recover the Infrastructural costs and then it can think about profits.

With behemoths like Vodafone, Airtel, Tata, Aircel and Reliance already finding it hard to feel comfy, it would be suicidal for a new entrant into the space. Isn’t it? Well, not quite so !

Enter the Spoiler

Japan’s NTT DoCoMo   wanted to enter into the emerging markets and thought India would be a great place to bet on. It collaborated with Tata Teleservices and launched the Tata DoCoMo . Now, DoCoMo was new, it had to fight with mighty Goliaths like Vodafone  and Airtel . It has to do something drastic which would get it some attention and shake the biggies. And what did it do? As it says in its tagline- it did the new. DoCoMo triggered off a tariff war which the biggies couldn’t help but enter into as well.

This war was triggered by the Tata Teleservices. DoCoMo was launched with its introduction of the Pay per second and Pay per character SMS services. Indicom came out with a cracker of a plan – the pay per call Plan. Virgin mobile followed. Suddenly, it had left the biggies Airtel, Vodafone & Reliance dumbfound.

Since it’s inception, DoCoMo has launched the ‘Pay per Second’ and ‘Pay per character’ talk and SMS plans respectively. These have been quite warmly received by the consumers. The only problem as of now has been it’s terrible network. This will soon change as DoCoMo will share the BSNL towers to increase it’s network connectivity and handle the traffic better.

Let’s see how each of the Players are fighting it out in this battle

Airtel & Vodafone

As if losing the MTN deal  wasn’t enough!!! Sunil Mittal must be saying these exact words to himself.

Both Vodafone and Airtel haven’t in the past been too keen on offering cheap tariffs to customers. Almost with a kind of snobbery they pretended to be catering to customers who valued quality network and value added services over cheap tariff plans. I must say that they succeeded too. But, now the game’s changed and they are changing for sure.

Vodafone & Airtel both has been forced to reduce and reconsider it’s tariff plans.

Indicom  & Virgin 

Tata Indicom took the war to a level further. It introduced the ‘Pay per Call’ plan. Whether you talk for 1 or 10 minutes, you pay Re 1. This plan has definitely caught on with the customers. But, how profitable is it for Tata Tele is another question.

Virgin is offering super attractive plans which talk of STD @ 1Paise/min.

Reliance -- RCom 

Reliance recently launched it’s 50P/min call tariffs in response to the war taking place.

Aircel

Aircel , which started with its services from the state of Tamil Nadu is slowly grabbing market share all across India. Thanks to it’s expansion plans and marketing.

Aircel has come up with it’s 1-2-3 tariff plans and seems to be getting a good response.

The Issue of Number Portability 

Something that will act as a fuel to fire is the number portability policy. Once it gets a go ahead it will intensify the war.

Basically number portability allows you to change your service providers without changing your number. This is a much needed change in the Telecom sector. Many a times we forego attractive plans by other service providers just because we don’t want to change our phone numbers.

Once number portability  comes in, the consumer won’t think twice before switching service providers. Only the telco with the best network, best services and cheapest tariff plans will be able to retain customers. Which is a great thing for the consumers.

Is this Hyper-competition good for the Telecom Industry ?

Well, it is good to see great telecom companies from all over the world like Virgin, NTT Docomo and Vodafone flocking to India and making the competition tougher but at the end of the day what’s important is profitability in a business.

This break-neck competition to increase volumes at any cost can prove to be extremely harmful. The new tariff plans will erode the margins of the companies, even leading to losses. The companies will not have any choice but to take part in the price battle because otherwise they would simply close down.

Who will win?

Ya, the million dollar question. Whoever wins the war would have done the following things right-

• The Indian urban market is 80-90 % penetrated. The winner would try to reach penetration levels of 70% in the rural markets as well. Because that’s where the new & first time subscribers are.
• Would build a strong and vast network. In the fight to reduce tariffs the companies have to bear in mind the aspect of network quality too. You can’t give a plan to a customer having 1 paise/min STD but, without any network. Just doesn’t work. (This will also strengthen the first point about penetration.)
• 3G. Basically the ability to embrace new technologies fastest will be of huge importance.
• Profitability. Irrespective of anything the companies have to ensure a positive balance sheet and generate cash-flow.

 It would be extremely interesting to observe how things unfold and take a course in the future. These situations aren’t seen everyday and in the Indian Telecom Industry it is definitely the first of this magnitude.

The biggest Indian deal

So what exactly went wrong?

After months of due diligence and talks between Bharti and MTN, after countering a host of issues, the deal couldn’t go through because of the ‘Structural issues’ as stated by the South-African government. It is believed that the main problem of the South-African government with the deal was due to the problem with dual listing.

What is dual listing and what was the problem in the stocks getting listed in two exchanges?

Dual listing is the provision by which a company can be listed in the stock exchanges of two countries. If the dual listing of the Bharti-MTN was approved, both Bharti and MTN would have been listed in the stock exchanges of India and Johanessberg.

This would have helped both the companies to retain their identities. While Bharti was not very rigid about retaining the identity, MTN was.

Presently dual listing is not allowed in India. The Indian government would have had to change a great deal of the company’s law acts in order to fit in this deal. That obviously didn’t happen.

Also, valuation wise it seemed to be a better deal for Bharti than for MTN.

So finally the deal didn’t go through, resulting in all the due diligence by both parties to nothing but zilch.

Quite contrary to the falling out of the deal, the Indian markets cheered this failure with the Bharti stocked closing the following day with a 5 % gain. Brokerage houses and investors felt it was a positive outcome. The reason for the stock price jump was attributed to the fact that Bharti wouldn’t have to take a huge debt on it’s balance sheet due to the acquisition failure.

But, shortly after, the street realized the long term benefits that the deal would have brought to Bharti. Suddenly it seemed there is not enough scope for Bharti to grow in the long term.

In a matter of days the Bharti stock plummeted from the Rs 440 odd levels to Rs 340. A drop of 25%, which is usually unlikely of a stock like Bharti which has a very low Beta.

The Bharti effect has cascaded to other subscribers like RelCom, Tata Tele etc. Though there is another reason for this – The aggressive price war that all the telecom providers seem to be waging amongst themselves.

Now, it remains to be seen how Bharti and Sunil Mittal chalks out a robust plan for the future of the company. A plan that will take it to levels that it’s leader envisions and it will have to take on a vast number of competitors to emerge as the winner. Whoever wins or loses the battle, the customer will be the ultimate beneficiary.

We will definitely be watching these developments closely.

Related older posts:

Capitalism -vs- Nationalism; what should Bharti and MTN do?

Bharti Airtel -- MTN deal is terminated. Bharti says South-African government was unable to accept deal in the current form.

Bharti hopes to resume talks with MTN later in the future.

Super Update 2

Bharti tries to take care of South African pride with lucrative offerings such as

• Allowing the constitution of MTN top management to be purely South African, to retain its South African roots
• Increase MTN’s stake in Bharti from 25% to 27%
• An all-cash offer for MTN’s shareholders, with an option to have JSE listed GDRs

Bharti is also lobbying the PM’s office, as PM Manmohan Singh is expected to have a word on this deal with SA President Jacob Zuma, when they meet during the G20 summit. A delegation from SA government is also about to meet officials in New Delhi seeking clearance of the deal by the Indian Govt. in terms of dual listing.

Microreviews Predicts: The deal will close on the current terms with dual listing not getting a nod.

Prior Developments

With the ARPU (Average Revenue Per User) rapidly decreasing for the Indian telecom giants, they are desperately on the lookout for greener pastures in Africa and Western Asia. On the other hand African and Western Asian telecom players need big money to expand rapidly.

Bharti -- MTN would have been a perfect marriage, a breather for both the companies. But here comes the spoilsport; the South African labour federation, COSATU, trying to pressurise the SA government, which in turn is playing its nationalist sentiment card. The SA government says that if the merger takes place, then MTN will no longer remain a South African company. COSATU fears that local people will lose jobs if the merger takes place.

The South African government is very much aware that Indian government does not allow dual listing of any company listed in the Indian bourses. But, the SA government has put down the condition of dual listing for both MTN and Bharti in bourses of South Africa and India. Laws of a country cannot change overnight, and that too just to accommodate a whim of the South African government.

Many of us would feel that concerns raised by the South African government and COSATU are genuine, but what the SA government and COSATU have failed to realize is that this merger would only enhance any job prospects for the local population with the money being pumped in by Bharti into MTN. MTN would still have 51% say in the merged entity, which means that it would still remain a South African company.

Nationalist approach -- what does everyone lose?

• MTN misses out a major expansion plan, which it could have managed with the money pushed by Bharti
• South African economy loses a huge boost needed post-recession
• Bharti loses any expansion plans in the emerging African and West-Asian market
• Resurgent market loses the first transcontinental telecom superpower -- the only which could have stood up against the Chinese competition
• Global economy loses any more prospective Afro-Asian mergers, which are need of the time for mutual and sustained growth

Capitalist approach -- why is it a win win for everyone…

• MTN expansion plans get a huge boost from the money it gets from the merger
• South African economy may see more jobs being created with a resurgent MTN
• Africa and West Asia may see a more competitive pricing (read cheaper), which Bharti has already achieved in India
• Bharti gets a new and fast growing market to prove its potential of being the telecom mogul
• This merger can springboard the recovering market; the right move at just the right time
• It will pave way for more Afro-Asian JVs and mergers, especially Indo-South African (both of these countries lead the way as fast growing economies in Asia and Africa respectively)

Probably the South African government should let go off its whims, and think beyond its geographical boundaries. MTN and Bharti should definitely go ahead with this merger, even if they have to wait for sometime before the SA government losens up.

So what is this 3G that everyone is so buzzing about. What exactly does it offer us and why should we move out of our comfort zone (read GSM).

Well  3G or 3rd Generation is a famiy of standards for Mobile Telecommunication defined by ITU. Services include wide area wireless voice telephone, video calls, broadband packet/mulimedia services -- all in a mobile environment. Comared to its predecesors, 3G allows simultaneous usage of voice and data services with HIGHER bitrate ofcourse. While GSM/GPRS/EDGE have data rates of 9.6/56/150 kbps max, 3G gives you 14.4 Mbps in downlink and 5.8 Mbps in uplink (in theory that is). The picture below describes the basic nodes of a 3G network.  The circuit switched Domain caters to the voice services while the Packet Switched Domain serves for the data services.

a 3G Network - Basic Nw Elements

The offerings for the niche demographics would be video broadcast/VoD and mobile broadband data intensive services -- say e-mail, e-learning, stock/bank transactions. The idea is to give millions of people access to Broadband Internet in a short span of time. Also it would bring business to Indian Software majors to join hands in rolling out application catering to the same and then launch themelves to emerging markets.

Sounds all goody. So what is the catch? What are the deterrents?

Well its not that 3G is yet to come in India. State owned MTNL launched the 3G services in India last December. But the private players are yet to enter the bandwagon thanks to the promptness on the part of Indian Govt wrt the Spectrum Auction for 3G. Actually for an operator to roll out 3G services, they need the separate frequency bands (from the existing ones for GSM) otherwise called spectrum. Govt. allocated the same to its owned operators -- MTNL/BSNL to give them a headstart (how much they have been able to capitalize on this headstart is another story).

The base prices for 3G spectrum auction (which the Govt. claims to complete in next 90 days) stands at Rs 3500 crores, while for WiMax it stands at Rs 1750 crores. Speaking on behalf of eGoM (Empowered Group of Ministers), Commn and IT minister A. Raja said, “I do feel the Govt of India, putting together 3G and WiMax will easily get Rs 25,000 crore”. Apprehensions are that the Govt of India might make the most of this spectrum auction to clear its financial debt. Which would in a very bad way impact the end consumer.

State owned MTNL’s 3G launch didnt go too successfully. Maybe it was the tariff or the poor marketing startegies, the situation as of today is that MTNL  is looking for Private Collaboration which too generated lukewarm response. With hopes of reviving the same, they have come out in collaboration with Micromax, with a resonably priced 3G Handset.

So what are the roadblocks  to the success of 3G in India. For starters, 3G services will come at a premium. Two, a whole new infrastructure needs to be built. Three, there is an existing crunch of spectrum for voice services. So Telcos might be inclined to use these extra bandwidth to firm their grip on the existing GSM network. A Poll on how telcos are going to use the acquired 3G spectrum doesnt portray a pretty picture.

So is the situation all that gloomy. We hope NOT. With private players like Airtel having annnounced about their plans of launching the 3G services by October ’10, there is hope. With private players entering the market, the space is expected to get competitive. Plus Airtel has as large a customer base in India alone as MTNL has across continents. Also now that Bharti Airtel has announced its plans, an announcement from the other leading players -- Vodafone/Reliance should be underway. Vodafone and Airtel would in particular be the major players since they are authorized delivery poins of 3G iPhones in India.

So lets hope for a quick/affordable 3G rollout in India. And as a lawyer would say : if it may please the Govt!

These three companies mentioned above have been late entrants in the Indian broadband scene (compared to BSNL and VSNL) but have grown since then to become three significant players in the field. I will try to compare their services as per my experience.

RELIANCE : I had a reliance 600kbps connection a few months back.
pros: very good connection. used to get perfect bandwidth most of the time. At night it even registered
speeds like 80KB/s and never used to go below 60-65KB/s. Online video streaming was completely smooth.
cons: If something did go wrong they won’t respond to your complaints for days on end. Actually that was
finally the reason I had to unsubscribe.

Update1 25th Aug): Here we have someone really complaining about reliance customer service.

It used to cost me Rs.1600/month( from BTM layout Bangalore)

For reliance and finding it was tough Please visit here and find out your own plans.

TATA :  Currently I have a TATA wimax connection at 384kbps.
pros: Can’t find any.( From BTM layout Bangalore)

@Arkid : I however had a TATA INDICOM connection and it worked absolutely brilliant. The only problem was when it got disconnected, their people donot respond that easily ( From Aundh,Pune)

cons: The speeds are pathetic. Sometimes during rush hours (read 7PM -- 11PM) bandwidth falls below 10KB/s. We have complained repeatedly to no avail. Besides it disconnects at it’s own whim at all sorts of odd times. Imagine you have placed a large file for download and disconnects midway, or even worse at 95%.( from BTM layout Bangalore)

I’m shelling out Rs.1100/month for this

For Tata Indicom tariffs please visit here.

AIRTEL :  I haven’t had the opportunity to try it out personally. I have seen it at a friends place. My friend has an airtel    turbo connection, which provides 512kbps in the morning and 1mbps at night.
pros: excellent connection. My friend gets nearly the entire promised bandwidth all the time, and the 1mbps
at night is really cool. best connection i have seen.
cons: coverage is very limited. I am one such unfortunate person whose area doesn’t come under it’s coverage.

It’s costing him Rs.1300/month for this.( from BTM layout,Bangalore)

@Arkid : I have a similiar connection in Andheri Mumbai, and even I agree it works out brilliant ( Andheri East, Mumbai)

For Airtel BroadBand Tariffs please visit here.