Data customers never had it so good. A slash in 2G data tariffs by Vodafone India triggered competition to follow suit, with Idea Cellular becoming the third operator to reduce prices in the last three days.
However, the reduction is not in the metros, the highest revenue-earning circles for the operators.
“Urban customers understand the power of the Internet. Now, we have to get the rural customers on to the bandwagon, and the launch of these schemes would help in gauging the impact of these data schemes,” Idea Cellular Managing Director Himanshu Kapania said.
Of the total of the 900 million-odd mobile users, less than 100 million are data users, he added.
On Thursday, GSM operator Idea Cellular slashed 2G data tariff by 90 per cent in eight circles to 2 paise per 10 KB from 2 paise per KB, effective July 1. The reduction was across Tamil Nadu & Chennai, Karnataka, Kolkata, West Bengal, Assam, North East, Bihar and Orissa, mostly non-metros.
VOLUME GROWTH
“The operators are tapping volume growth and these are circles from were volumes could come in. They need to improve revenues from data services and are looking at 2G as many of these regions don’t have 3G services,” said Ankita Somani, sector analyst with Angel Broking.
The benefits of these schemes are they are being launched under ‘pay-as-you-go’ basis. This eliminates the issue of recharges, apart from ensuring adoption, Somani said.
Earlier on Tuesday, Vodafone India slashed 2G data charges by 80 per cent across three circles - Karnataka, Uttar Pradesh (West), Madhya Pradesh & Chhattisgarh – and said it would extend these to the rest of the country. The company, a subsidiary of the U.K.-based Vodafone, cut rates to 2 paise per 10 KB from the earlier 10 paise. Bharti Airtel also slashed data usage charges by 90 per cent for pre-paid subscribers in Punjab and Haryana.
“Everybody is looking at rolling the services from the markets where they are comfortable. After the rollout, the operators wants to see how it fares, before extending it other regions,” Ambrish Jain, Deputy Managing Director, Idea Cellular said, adding “These are centres where the data usage is very low”.
Telecom companies, however, are not slashing rates on 3G services that are more data-centric than 2G. “The 3G rates are relatively low, but default 2G rates are high,” adds Jain.