BANGALORE, India-While the Indian cellular industry generally has been battling rough weather recently, one cellular operator in the country has adopted a strategy that seems to have paid off: focusing on quality rather than numbers. The carrier, BPL Mobile, may use that same strategy as it contemplates expanding into other Asian markets.
BPL Mobile, now with almost 250,000 subscribers, has emerged as the largest cellular operator in the country.
Overall airtime use is very low in India-about 120 minutes a month. Operators were mandated to pay 500 rupees (US$11.62) per subscriber per month to the Department of Telecom (DoT) as part of license-fee obligations. Therefore, operators were forced to revisit their customer profiles and take strong measures to remove defaulters.
For BPL Mobile, discarding low-use subscribers as part of the license-fee obligations had a marginal impact compared with other Indian operators. The company now has managed to achieve both the highest average revenue per subscriber and average monthly airtime use of 250 minutes in the country.
BPL Mobile, which comprises two cellular companies-BPL Mobile Communications Ltd. and BPL US West Ltd.-thus clearly has emerged as a winner in the Indian cellular industry.
The company has managed to get the most lucrative markets in India: Maharashtra, Goa, Mumbai, Kerala, Tamil Nadu and Pondicherry, explained Rajeev Chandrasekhar, the young chairman and managing director of BPL Telecom Business Group in an exclusive interview with Global Wireless.
BPL Mobile’s success is based on “an amalgam of BPL’s understanding of the Indian consumer and the joint venture partner’s expertise around the globe. That’s what BPL mobile is all about,” said Rajeev, who formerly was a CPU architect for Intel’s Pentium team. “As a member of the Global Connect Consortium (a roaming consortium), BPL Mobile allows you to be mobile in 21 networks across 13 states in India and 56 countries the world over.”
Looking beyond India
The company now is looking at the mergers and acquisitions route, as well as potential tie-ups with other global players to strengthen its position in Asia and expand its coverage area.
Rajeev hinted the cellular group is keen on acquisitions and is looking to buy cellular businesses in India and South Asia. “Our strength lies in these regions. Instead of looking out for expansion in areas where we have not been exposed, we will look at the cellular companies in these areas,” Rajeev said.
According to inside sources, the company has been besieged with offers from various cellular companies in India keen to exit their ventures and are looking for buyers. One executive of BPL confirmed two companies-JT Mobile and Skycell-have approached BPL to sell their stakes.
“We are waiting for the new telecom policy to be finalized and will decide only after that,” the source explained.
He added that while these two companies have made direct approaches, other major companies also have made offers, but he declined to disclose those names.
Several firsts
To enhance its service, BPL was the first in India to offer national and international roaming.
BPL Mobile’s GSM technology upgrade addressed the international roaming service needs of its customers. An international roaming service facility to Singapore was established, and BPL Mobile added the United Kingdom and the United Arab Emirates to its network in December 1999.
In addition, BPL Mobile has entered into strategic tie-ups with four U.S. operators-Omnipoint, Powertel, Aerial and Voice-Stream-offering automatic roaming in the United States to its subscribers. For technical and service expertise, BPL Mobile entered into joint-venture partnerships with France Telecom for its Mumbai operation and MediaOne for networks in Maharashtra, Goa, Tamilnadu, Pondicherry and Kerala.
BPL Mobile is the only cell phone operator in India to install digital microwave technology, offering signal clarity in inclement weather and climates from Digital Microwave Corp.
BPL Mobile became the first operator in India to offer the Iridium roaming service to its subscribers in November 1999. Incidentally, this launch came soon after the clearance from the DoT for national and international roaming of Iridium subscribers into cellular networks and vice versa. Iridium also has roaming agreements with eight other Indian cellular operators.
BPL Cellular Holdings Ltd. (BPLCH) owns 74 percent of BPL Mobile, with the other 26 percent owned by France Telecom. The BPL Group owns 67 percent of BPLCH.
BPL Group is waiting for international markets to improve before launching its proposed American Depository Receipts (ADR) issue, which will list the BPL Mobile stock on the U.S. Nasdaq stock market.
