If you are one of those who spend at least Rs 400-500 every month on mobile phone services, you may soon start getting calls from telecom carriers offering bucket, or bundled, plans.
In what analysts and industry insiders see as an after-effect of the Reliance Jio launch offering free voice calls for life, others in the sector are expected to come up with plans where the customer won’t be paying separately for voice and data.
Both will be offered under one bucket plan — generous hunks of data bundled with loads of free voice minutes, content and services — at a fixed price. The Big 3 of Indian telecom — Bharti Airtel, Vodafone India and Idea Cellular — will be compelled to migrate to bucket plans for retaining mid and high-end customers amid rising churn, they say.
This is inevitable for the top three, said Bharti Airtel’s former Chief Executive Sanjay Kapoor. They will restructure their tariff by moving to bundled plans “in their aim to counter Jio”, he added.
“Jio realises that Airtel, Vodafone and Idea are hugely dependent on voice revenues”, and is likely to try every trick in the book to capture the imagination of their lower-end voice customers through its unlimited voice offers with bundled data, Kapoor said.
In such a scenario, to hold on to higher paying customers, Jio’s rivals will have to make their offers attractive, even if that means taking a hit on their revenues initially. Voice services make up nearly 80% of the revenue for incumbent carriers.
Airtel and Idea have already said they will aggressively contest the 4G space with bundled plans once Jio starts charging customers — Jio’s free voice and data welcome offer is valid till year-end for those who subscribe to its services till December 3. Airtel indicated that it will retain some regular tariff plans that charge voice and data separately.
Talking to ET recently, Bharti Airtel India CEO Gopal Vittal said half the country’s telecom market in the medium term would comprise feature phones where voice and data tariffing would remain decoupled, while the smartphone turf could see more demand for bundled products.
Kapoor, however, said it’s just a matter of time before decoupled voice and data tariff plans totally disappear, paving the way for bundled plans since “voice-only customers are a dying phenomenon, much like the feature phone”.
Analysts though rule out the possibility of unlimited data offers under bucket plans.
Nitin Soni, director at ratings firm Fitch, said it would be virtually impossible for any telco to offer unlimited all-you-caneat data under a bucket plan on a regular basis since spectrum is expensive in India and the associated network capital requirements would also be huge for handling any potential upsurge in data consumption when it is offered free.
“Even in more evolved markets like Singapore, Korea and the Philippines, telcos couldn’t sustain unlimited data offers within a bucket plan and had to charge it on a pay-as-you-go basis, beyond the free allocated level,” Soni said.
In what analysts and industry insiders see as an after-effect of the Reliance Jio launch offering free voice calls for life, others in the sector are expected to come up with plans where the customer won’t be paying separately for voice and data.
Both will be offered under one bucket plan — generous hunks of data bundled with loads of free voice minutes, content and services — at a fixed price. The Big 3 of Indian telecom — Bharti Airtel, Vodafone India and Idea Cellular — will be compelled to migrate to bucket plans for retaining mid and high-end customers amid rising churn, they say.
This is inevitable for the top three, said Bharti Airtel’s former Chief Executive Sanjay Kapoor. They will restructure their tariff by moving to bundled plans “in their aim to counter Jio”, he added.
“Jio realises that Airtel, Vodafone and Idea are hugely dependent on voice revenues”, and is likely to try every trick in the book to capture the imagination of their lower-end voice customers through its unlimited voice offers with bundled data, Kapoor said.
In such a scenario, to hold on to higher paying customers, Jio’s rivals will have to make their offers attractive, even if that means taking a hit on their revenues initially. Voice services make up nearly 80% of the revenue for incumbent carriers.
Airtel and Idea have already said they will aggressively contest the 4G space with bundled plans once Jio starts charging customers — Jio’s free voice and data welcome offer is valid till year-end for those who subscribe to its services till December 3. Airtel indicated that it will retain some regular tariff plans that charge voice and data separately.
Talking to ET recently, Bharti Airtel India CEO Gopal Vittal said half the country’s telecom market in the medium term would comprise feature phones where voice and data tariffing would remain decoupled, while the smartphone turf could see more demand for bundled products.
Kapoor, however, said it’s just a matter of time before decoupled voice and data tariff plans totally disappear, paving the way for bundled plans since “voice-only customers are a dying phenomenon, much like the feature phone”.
Analysts though rule out the possibility of unlimited data offers under bucket plans.
Nitin Soni, director at ratings firm Fitch, said it would be virtually impossible for any telco to offer unlimited all-you-caneat data under a bucket plan on a regular basis since spectrum is expensive in India and the associated network capital requirements would also be huge for handling any potential upsurge in data consumption when it is offered free.
“Even in more evolved markets like Singapore, Korea and the Philippines, telcos couldn’t sustain unlimited data offers within a bucket plan and had to charge it on a pay-as-you-go basis, beyond the free allocated level,” Soni said.
