Expert View

June 13, 2003
WLL has tremendous potential: TTSL

Geetanjali Wadhwa & Pradeep Chakraborty

NEW DELHI -- Is the mobile phone segment really cannibalising the basic services segment as many industry observers are pointing out? Convergence Plus met up with S. Ramakrishnan, managing director, Tata Teleservices Ltd. (TTSL), to find out whether there had really been any deceleration in the growth of landline subscribers following the surge in mobile subscribers, and the depth of the services being offered by the carrier. Excerpts from an interview:

Convergence Plus: Is the mobile/WLL phone market cannibalizing the corded telephone market?

S. Ramakrishnan: The basic telephony space is extremely competitive and one needs to constantly re-invent and re-monitor the situation to survive and grow in future. Wireless in local loop (WLL) has tremendous potential in India, largely because of the growth potential of teledensity in this country. It is an ideal technology platform for countries like India as it allows better utilisation of spectrum, as a result of which, the cost of calls are lower for an increasing subscriber base.

The key to survival for any telecom company would be the quality of service (QoS) it offers to customers. A lot has been written on "how telcos are slashing tariffs to remain competitive." However, you need to remember that world over, lower tariffs alone have not been a sure guarantee for success for any one of the telecom companies. The challenge for all telecom service providers would be to "innovate" at a rate faster than competition.

You will see the proliferation of value-added services, which are not just for namesake, but would really make a difference in the lives of customers, be it the way they shop, want to be entertained, etc. The industry is already moving in to provide increasingly bundled offers, which appeal to different sets of customers. Operators are offering smart tariffs that appeal to certain niche segments.

CP: Do you think there been any deceleration in the growth of landline subscribers owing to the surge in mobile subscribers?

SR: It has been an international trend, and also demonstrated in India, that the pace of growth in mobile communications is much faster as compared to landline services. From a telecom service operator's point of view, wireless technology allows rolling out network at a much faster rate and in an instant cover a large geographical area. On the other hand, proliferation of landline services in a given geographical area naturally takes time.

CP: How has the launch of WLL services affected cellular/fixed services?

SR: It is not fair for TTSL to comment on competition. All we can say is that BSNL and MTNL have done a very good job in increasing the growth of telecom services in this country. However, speaking from a TTSL perspective, we already have more than half a million customers across our six circles. TTSL is very happy with the solid progress it has made in its telecom venture and we are all set to service 75 percent of the voice and data traffic in this country.

CP: Have the recently announced tariffs affected your fixed line and WLL services?

SR: Indian users do not relate well to upward tariff movements, and therefore, they will not take increasing tariffs kindly. However, the telecom marketplace is very dynamic and is changing every day. Tariffs will depend on the various happenings in the marketplace.

CP: Why should GSM users switch over to your service? What are your USPs?

SR: Please understand both GSM and CDMA technologies are here to stay as they appeal to different sets of consumers as evident in other countries. As for CDMA as a mobile technology, this technology has certain inherent advantages. These are:

• Superior voice clarity: CDMA uses state-of-the-art 3G advanced network to deliver voice and data to the users.
• Lesser call drops: CDMA allows more users to share the airwaves simultaneously, hence facilitating smooth call handover.
• Affordable mobile service: With free incoming call facility and outgoing calls just being charged as low as 55 paise per minute, this results in significantly lower telephone bills.
• Enhanced privacy: CDMA converts speech into digital information, which is then transmitted as a radio signal over a wireless network, using a unique code for every call, thus making it very secure.
• It is a 3G technology: It allows high-speed data transmission of over 144Kbps, allowing faster data downloads, resulting in the use of the Internet-based value-added services.

Consumers who stay within a city or what in telecom parlance is called a short-distance charging area (SDCA), would naturally find a CDMA phone a more attractive proposition. In the end, it all boils down to the end customer, what his needs are and how he would like to fulfill those, keeping the price-value equation in mind.

CP: What all data services are you currently offering and how soon do you expect to break even?

SR: Tata Indicom is your partner in every step of your life. We offer a complete range of telecom solutions for home and business needs, without burning a hole in your pocket. Be it CDMA mobile, landline connections, public phone booths, broadband services or Centrex, we are present in every sphere of the telecommunications market, endeavoring to make your life comfortable and hassle free. We have a wide-range of product and service offerings to meet every need of yours:

Voice

• Tata Indicom CDMA mobile
• Tata Indicom phone connection
• ISDN lines
• Centrex
• E1 links
• Basic/primary interface
• Managed leased lines
• Direct inward dialing (DID)
• Public phone booth

Data

• Shared and dedicated Internet bandwidth
• Virtual private networks (VPNs)
• Tata Indicom international IP VPN services
• Tata Indicom hosting services
• Industry-specific solutions
• ADSL and DSL

Internet

• Tata Indicom postpaid Internet connection
• Tata Indicom broadband Internet services

Tata Indicom conference services

• Conference call service
• Videoconferencing service
• Webconferencing service

CP: Is an over-dependence on voice services detrimental to the industry's health in the long run?

SR: The opening of the country has set loose a whole new set of market forces, resulting in surge in data services requirement. The gap between voice and data services is fast closing, which is a very positive sign for the telcos in the country.