Friday, February 10, 2006

Cheap, Cheaper and a bit more Cheaper

When I arrived in India (Delhi) in the 2nd week of January one of the first things I saw as I drove out of the Airport was a billboard advising Mobile Phone Plans. For some RS 1499 (about USD 35) I could get a pre-paid mobile service with some call credits included, which I suppose was not too bad.

A couple of days later (and I assume in an attempt to get market share in what is a very competitive market) one of the operators began offering the deal at a similar price with 6 months of incoming calls free (ie. one does not need to re-charge every 3 months, etc. to maintain the number). Well this was the start of the “free incoming war”.....over the next 2 weeks or so each operator was jumping on this bandwagon, and improving on the promises of others. First it was 1 year incoming free, then 1 year at a cheaper price, then 2 years, then 2 years at a cheaper price, and so on.

Net effect of all this: when I left India some 4 weeks later, I could get a mobile service for some RS 999 (about USD 24) with lifetime incoming free. Not only that but I could also get a service which would allow me to call anyone on any operators networks' (fixed or mobile) for RS 1 (about US 0.02) anywhere in India, which is pretty amazing value.

Of course the available market is large (I guess huge would be a better word), so there is plenty for all operators to survive and make money. There is nothing like healthy competition to keep pricing fair and deliver value to the consumer and models can be developed to suit most market sizes – it just requires thought and commitment.

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