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Disrupting India's wild mobile market

17 May 2010
00:00
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Best Emerging Markets Carrier

Tata DOCOMO

Last year's winner:XL
Business segments:Pan-India 2G mobile (GSM)
Managing director:Anil Sardana
Key shareholders:Tata TeleServices 74%, NTT DoCoMo 26%
Key stat:(March 2010) 65.9 subs (incl TTSL)

It's the newcomers who disrupt markets, but not many are as new as Tata DOCOMO.

A joint venture between Tata Teleservices (TTSL) and Japan's NTT DoCoMo, it started service as the Tata group's GSM provider last June.

Up to that time TTSL had clocked up 36.5 million subs in several years offering CDMA service. Nine months later, that number had skyrocketed to 66 million.
Instead of adding just 750,000 monthly net subs as before, Tata is now signing up around three million and it has become the country's fifth largest mobile operator, a tad behind BSNL.

Even more spectacularly, it began offering per-second charging and in so doing forced its bigger competitors to change.

"We have disturbed the market to the point where the established players have heard it and have followed suit," said N.V. Subbarao, who heads the southeast India hub.

"Overnight the leaders became followers, which is encouraging for an operator like us."

The key has been the Tata brand, says Subbarao. Tata is one of India's biggest and best-known business conglomerates, with investments in steel, autos, IT and chemicals. But it is also known for its philanthropy and ethical business practices.

"It's not so much about per second pricing," Subbarao said. "There was an opportunity and need to recognize fairness and transparency, which is something customers also want. It's recognizing people's time and money are precious."

The NTT DoCoMo brand name also brought "a lot of credibility, scale, expectations and excitement."

But it is one of the world's toughest and most dynamic markets. "It changes every six months or so." Customers can trade off different operators at the drop of a hat. It's also a multi-SIM environment where consumers use dual-SIM handsets in order to "max on the best deals."

Around the corner is the long-awaited introduction of 3G, bringing yet another change in the dynamics.

"The Indian consumer has been extremely smart and pretty responsive to new technology," Subbarao points out. A significant segment of customers "is global as anything in the world," while the fact that 70% of the population can't get traditional internet promises an even bigger opportunity.

"In a large number of small towns the mobile internet penetration is more than the ISP. That number will increase. The trick is how to find the right price paradigm and obviously to build a business."

Thanks to the wide penetration of TV - more than 90% have cable TV in some areas, and 65% in rural India - everyone is aware of what is available.

"Historically Indian consumers are early adopters - that gives us a lot of confidence."

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What the judges said: "For dominating subscriber growth in one of the world's most competitive mobile markets and in changing charging practices for the whole market"

 

Winners' list:

Related video: Celebrating Asia's telecom champions
 

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Rating: 5