Monday, November 23, 2009

Just Rs.19 To Change Your Telecom Operator!

Buzz this
Well TRAI has put all these rumors to rest by announcing that MNP would come into effect by 31st of December this year and the charges for shifting from one operator to another is pegged at a meager 19 rupees.

Now this should surely make the operators sit up and take notice as the dynamics between operators could change as this could bring a shift from the incumbents to the entrants in the telecom space.

Now TRAI has announced that the operators cannot charge the consumer more than Rs.19 to shift his number from one operator to another.

TRAI has announced that MNP would be implemented in category A circles by 31st December and by March next year the entire country would have MNP enabled.

How could MNP impact the players?

Given the low cost of shift this would bring into focus not only the number subscribers who shift but also the kind of subscriber as in post paid vs pre paid and premium vs low end. For example if I am currently with vodafone and my average bill is Rs.3000+ then I am a super premium customer and MNP could really hurt operators ARPU (average revenue per user) numbers if a customers like me make the shift. Hence the impact would not only be in % terms of subscribers i.e. no of subscribers moving out of an operators kitty but also in terms of lifetime value of customer to the topline of the operator. So its not only how many but who makes a shift which also counts.

How would MNP impact VAS players?

We have stated how we feel VAS players can only gain from this as this would bring VAS into the forefront both as a differentiator and as an attraction value. So incumbents like Airtel, Vodafone and RCom would use VAS to retain their subscribers while entrants like Docomo, Aircel, IDEA and others would use VAS to attract subscribers to shift to their network.

Opportunity for a Premium Brand/Player?

MNP throws up the opportunity to create a premium brand and for different pricing models for subscribers who are in the super premium category as far as monthly billing is concerned. Im one such subscriber and I can surely say that Ill be looking forward to operators vying for my 100 odd dollars (4000 rupees plus) a month in billing and providing me top of the line services. Till MNP every subscriber be it a 300 rupees billing customer or a a 3000 rupees billing customer was treated the same way. I expect this to change post MNP and expect operators to take a Bank like approach which they have for credit card i.e. Silver, Gold and Platinum card holder get very different customer service from the same bank. I expect the same differentiation to come in with respect to the amount of billing a customer generates for an operator in due course of time post MNP gets implemented.