Once termed as most prominent growth sector of growth is currently facing survival crisis. The ever mounting debt, penalties, 3G roaming, spectrum farming, spectrum auctions and other regulations are the talking point among ecosystem players to equity market. The Indian Telecom bubble which started post 1995 literally busted with 2G scam and subsequently cancellation of license by Honorable Supreme Court of India.
Even during the crisis period, Indian government successfully positioned 3G and BWA bubble among Mobile Operator mindset. Most of the Mobile Operator started thinking that 3G and BWA based services will change the negative growth tide and mobile subscriber will adopt services the way it happened during 2G & 2.5G based service. Mobile Operators failed to read the mind set of their esteemed user base and opted to quote exceptionally high bidding to own 3G and BWA spectrum. The move backfired with mounting debt, technology immaturity to ride on the upgraded to offer innovative services to end users.
Post committing first tactical mistake, the self inflicted tariff war turned the ecosystem as graveyard. The tariff war inflicted major financial burden on Incumbent Mobile Operator to retain their existing user base whereas the regional and challenger were grabbing the opportunity to acquire or enhance user base. The 2G license cancellation helped Telecom sector to recoup especially Incumbent Mobile Operators.
Telecom sector also moved quickly to raise voice tariff and cut on to freebies in order to propel ARPM (Average Revenue per Minute) and ARPU (Average Revenue Per Minute). The exponential growth in data volume and associated growth opportunity also excited most of the analyst. The blunder happened by Mobile Operator by not reducing their revenue share for allowing MVAS players impacted Mobile Operators the most. In order to fill the falling MVAS ARPU as well as revenue share out of total mobility revenue, Mobile Operators started reducing data download tariff to gain the first movers advantage.
In all, most of the Mobile Operators missed to analyze the core problem statement for continuous fall in most of the business segment and kept on blaming regulators that did not helped them either. Whatever is the situation of Indian Telecom Sectors, the Mobile Operators must come out honestly and take the onus of their current problems rather than blaming regulators for the same.
It was not regulators who enforced Mobile Operators to bid for spectrum and buy it at unreasonable level, tariff war initiated by regional players, bidding for 3G spectrum without understanding the roaming clause associated with it, maintaining high revenue share for legacy MVAS services. In conclusion, the lack of strategic move landed Indian Mobile Operators in self created shelf and it would be really difficult for them to come out of it.
Even during the crisis period, Indian government successfully positioned 3G and BWA bubble among Mobile Operator mindset. Most of the Mobile Operator started thinking that 3G and BWA based services will change the negative growth tide and mobile subscriber will adopt services the way it happened during 2G & 2.5G based service. Mobile Operators failed to read the mind set of their esteemed user base and opted to quote exceptionally high bidding to own 3G and BWA spectrum. The move backfired with mounting debt, technology immaturity to ride on the upgraded to offer innovative services to end users.
Post committing first tactical mistake, the self inflicted tariff war turned the ecosystem as graveyard. The tariff war inflicted major financial burden on Incumbent Mobile Operator to retain their existing user base whereas the regional and challenger were grabbing the opportunity to acquire or enhance user base. The 2G license cancellation helped Telecom sector to recoup especially Incumbent Mobile Operators.
Telecom sector also moved quickly to raise voice tariff and cut on to freebies in order to propel ARPM (Average Revenue per Minute) and ARPU (Average Revenue Per Minute). The exponential growth in data volume and associated growth opportunity also excited most of the analyst. The blunder happened by Mobile Operator by not reducing their revenue share for allowing MVAS players impacted Mobile Operators the most. In order to fill the falling MVAS ARPU as well as revenue share out of total mobility revenue, Mobile Operators started reducing data download tariff to gain the first movers advantage.
In all, most of the Mobile Operators missed to analyze the core problem statement for continuous fall in most of the business segment and kept on blaming regulators that did not helped them either. Whatever is the situation of Indian Telecom Sectors, the Mobile Operators must come out honestly and take the onus of their current problems rather than blaming regulators for the same.
It was not regulators who enforced Mobile Operators to bid for spectrum and buy it at unreasonable level, tariff war initiated by regional players, bidding for 3G spectrum without understanding the roaming clause associated with it, maintaining high revenue share for legacy MVAS services. In conclusion, the lack of strategic move landed Indian Mobile Operators in self created shelf and it would be really difficult for them to come out of it.
