Tata Indicom's 'Pay Per Call' Tariff Plan for Prepaid Cellular Subscribers

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Case Details:

Case Code : MKTG247
Case Length : 17 Pages
Period : 2005-2009
Pub Date : 2010
Teaching Note :Not Available
Organization : Tata Teleservices Ltd
Industry : Telecom
Countries : India

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Introduction

As of 2009, the Indian telecom sector had the second largest network in wireless communications, next only to China. It was also growing rapidly in terms of subscriber additions, with more than 10 million new connections being purchased every month. There was fierce competition among companies in this sector to enhance their subscriber base.⁸ Moreover, the average Indian subscriber for cellular services was quite price-sensitive. Telecom service providers, therefore, had to come up with aggressive tariff plans to increase their subscriber base though such tariff plans impacted their Average Revenue Per User (ARPU) and, ultimately, their overall revenue.

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The proliferation and complexity of the plans from each service provider resulted in creating confusion among the consumers of telecom services. Some service providers attempted to cut through this clutter by offering simplified tariff plans which were also attractive enough to serve the purpose of gaining subscribers.

Besides, between the two competing technologies on which telecom services were based, that is, Global System for Mobile Communications (GSM)⁹ and Code Division Multiple Access (CDMA) , GSM was the preferred technology for most subscribers...

Excerpts >>

8] www.trai.gov.in.

9] GSM technology, based on the concept of Time Division Multiple Access (TDMA), allows eight simultaneous calls on the same frequency.

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