Forget
the statistics and growth figures. There can be no quibbling
with the highly visible end use benefits of the ongoing
telecom revolution, writes Probir Roy, co founder,
Coruscant Tec and Paymate.
If
indeed anyone were to be cynical with ''India shining''
or ''10-per cent per annum growth'' slogans, then one area
there would be no such quibble is acknowledgment of the
impact of telecom on everyday life of the migrant labourer
from Bangladesh, Nepal, interiors of rural India, the
shoeshine boy in Haryana, fisherman in Kerala, you, me
and the upscale corporate chieftain
The
end use benefits of the ongoing telecom revolution (one-fifth
of India is now digitally connected in some way) has clearly
and quite visibly demonstrated increased economic growth
and promoted market efficiency all within a decade.
The
classic documented case being a recent Harvard University
study showing how the introduction of mobile phones amongst
fishermen in Kerala has helped reduce fish catch wastage
from 8 per cent to zero, increased profits for fishermen
by 8 per cent and dropped prices by 4 per cent ! All because
the ubiquitous cell phone now allows the fisherman to
call the different landing points while he is still out
at sea and take stock of the catch available for sale
at each point and land his craft where he is reasonably
certain of a better price. Higher profits mean that phones
pay for themselves within two months.
Or
take Celtel Mobiles''experience in the poorest regions
of Africa where it employs more than 170,000 people. According
to the Economist, its presence "creates ripple
effects
which promote entrepreneurship and economic
activity".
The
conclusion, a chief economist''s dream, "Information
makes markets work, and markets improve welfare"
If
one were a keen observer of telecom growth in this country
(as indeed I am) and used the barometer of seminars, conferences,
roundtables, etc as an indicator as to how this sector
has matured. Then one will find that predominantly telecom
conferences, etc, have focused on infrastructure, scarce
resource allocation, equipment and devices. In essence
they have been vendor and engineering driven. And rightly
so. The better part of the last decade has seen penetration
of wireless and other related infrastructure literally
dot the skyline and surrounding landscape by way of open
conduits, ditches, dug up roads, sidewalks and unending
haphazard criss cross of wires!
The
next phase of the telecom revolution will now consist
of three key drivers.
First,
most of the time VAS has been the last token session or
topic of the seminar or summit!
This
has to and will change. VAS will become the most predominant
revenue and margin driver for operator survival. There
is now clear recognition within senior owners / managers
that with commoditisation of voice and declining ARPUs
(average revenue per user) all forms of VAS, whether it
is office applications to consumer entertainment and interaction
from the simple person-to-person SMS to interactive rich
media and mobile payments will be the buffer in the short
term and the cash cow in the long run (estimated to account
for up to 60 per cent of operator revenues in next decade
of growth).
Obviously
the business rules for this will change and operators
realise that they need to create an ecosystem of VAS partners
like the NTT DoCoMo model (100,000+ partners) by not only
sharing more revenue with them but also accruals in a
more accurate and timely manner. This will help incentivise
businesses to create desirable applicationss and content.
Ultimately
carriers are not in the content or software business.
They should it open it up to all others and will themselves
see an explosion in services they will be able to offer
to their increasing discerning users. The next killer
application (after email and chat) in the digital space
will emerge from within the suite of such VAS.
Second,
the emergence of next generation networks and access devices
whether they be wireline (IPTV / digital cable), wireless
(WiMax / WiFi / Zigbee, HSDPA / LTE, UWB, NFC or satellite
(DTH / DVB-HS) will once again change the rules of the
game and give consumers a bewildering hodge podge of technology
options as to how they talk, view, share, interact, search,
shop and pay and enhance their sensory experience. The
landscape of consumer choice and price will broaden penetration
of telecom touching at some level most part of Indian
households in the next five years.
Finally,
the last big issue, which hitherto has been given short
shrift, will be customer care, retention and overall quality
of service at the end use touch points. This current format
and culture still does not as yet hint to that but will
need to programme itself.
Number
portability opening up of more licenses and entry of new
players including mmobile virtual network operator or
MVNOs will necessitate carriers to differentiate themselves
over and above the 4 P''s of marketing. This will be of
great importance. The customer retention value is way
below the customer acquisition cost in a hugely price
sensitive market fragmented by many players and even more
wannabees.
I
have been a loyal, high value customer for my operator
for 10 years, but would easily consider a shift if I can
carry my number to another carrier and perception of benefits
mitigates cost. Unless, of course I feel that I am being
looked after adequately by my current carrier.
The
author is vice chairman, Internet & Mobile Technical
Committee of the non profit Media Research Users Council
(MRUC), and Member, Indian Merchants Chambers Technology
Committee
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