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G. Rambabu

According to official sources, more than Bharti it is the WLL services of Reliance that have acted as a dampener on the growth of CellOne.

New Delhi , Sept. 8

BSNL, which zoomed to the second spot just months after launching cellular services across the country, appears to be losing appeal.

If the latest subscriber figures released by the Cellular Operators Association of India (COAI) and the Association of Basic Telecom Operators (ABTO) are anything to go by, the aggressive marketing by leader, Bharti, and limited mobility (WLL) aggressor, Reliance Infocomm, have taken away the sheen from BSNL's CellOne services.

Despite offering the cheapest tariffs to its customers, the company could manage to add a little over 1.8 lakh additional customers in August, against 3.5 lakh by Bharti and 6.2 lakh by Reliance.

According to official sources, more than Bharti it is the WLL services of Reliance that have acted as a dampener on the growth of CellOne.

One of the main factors that had favoured BSNL when it launched its services in mid-October last year was its reach.

Compared to the private operators such as Bharti, which are yet to penetrate the rural corners of the country in a big way, BSNL did not hesitate to expand its reach to these untapped areas. With the result that it faced absolutely no competition and could pick up customers in droves.

However, with the launch of WLL services by Reliance, customers in these areas started having a choice, and that is where BSNL seems to have lost its competitive edge.

Even as an internal target of June had been set for it to overtake Bharti to become the largest cellular operator, the company is still struggling to narrow the gap.

Another factor which appears to have worked against BSNL was the free incoming regime enforced by the Telecom Regulatory Authority of India (TRAI) from May this year.

Until then, the CellOne tariffs had the lowest charge for both outgoing and incoming calls.

However, once all incoming calls were made free, the price difference in comparison to the private operators was not large enough to attract customers.

As the subscriber figures show, the gap between the subscriber base of Bharti and BSNL which was 5.3 lakh in May this year has now increased to over seven lakh.

During the same period, the gap between the market share of BSNL and Reliance has declined from 15.5 lakh to 1.4 lakh.

One reason for this trend is the `monsoon hungama' scheme launched by Reliance in July, which allows customers to subscribe to its services by paying just Rs 501. In that month alone, Reliance managed to attract over a million customers.

Following this, the private cellular operators hit back with `rental-free' plans for its post-paid subscribers, apart from a host of other schemes with lower tariffs, and also started bundling the services with the handset vendors.

This appears to have worked in their favour as number of new additions to the subscriber base of Reliance dropped by 25 per cent in August.

The sources said that having realised that BSNL could easily slip to the third position behind Reliance unless counter offers are made, the company has unleashed a new range of schemes targeted at students.

Many more such schemes are in the offing, with the festival season round the corner. But then it has to contend with similar efforts by both Bharti and Reliance and it could be quite a while before its dream of becoming the largest cellular company comes true.

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