Reliance Communications, Idea Cellular in 3G tariff war


After a month of controversial rise in 2G tariffs by
private operators including Tata Teleservices, Bharti Airtel, Vodafone, Idea
Cellular and Reliance Communications, operators are slashing 3G tariffs to
address demand during festival season.


The latest operator to have slashed 3G tariffs is
Reliance Communications, which last month also cut its broadband data tariffs
in Tamil Nadu. RCom has released a triple download benefit plan
at a single plan cost for 3G subscribers in its 13 circles, across 333 cities.
A 3-day prepaid plan with 195 MB usage is now being offered at the cost of a
single day 100 MB usage at Rs 65, while a prepaid 30-day plan of 300 MB comes
at Rs 108 and a 300 MB post-paid 30-day plan will cost Rs 100. This offer is
valid till October 2011.


RCom had earlier slashed its 3G tariffs, offering up to
50 percent discount with bundled data usage of its 3G tablet. In the Super Value Combo Offer,
the price for 1GB, 2GB and 5GB of data per month over a 12-month period is at
Rs 4,500, Rs 5,500 and Rs 7,000, respectively – as compared to the regular 3G
price points for the same amount of data which costs Rs 7,788, Rs 8,988 and Rs
14,388, respectively. As far as the monthly plan is concerned, for 2GB and 5GB
of data, the new price point is Rs 598 and Rs 798, respectively, as compared to
the regular price of Rs 749 and Rs 1,199.


This news comes a month after Idea Cellular,
which has the most successful 3G uptake in India, launched a double-benefit at
single plan cost offer for its 3G customers, valid till December 2011. With an
aggressive plan to target 3000 towns with 3G by 2012, Idea has been steadily
slashing tariffs in circles where 3G uptake seems to be most popular like
Maharashtra and Goa, Kerala, MP, Delhi and Mumbai, by 50-65 percent. A few days
ago, the operator reported over 5 lakh 3G subscribers in Maharashtra and Goa


Last month, the top five operators in India on the basis
of revenue, announced an increase in prepaid 2G tariffs of up to 20 percent,
to arrest falling ARPUs and negligible profits. Though asked to provide a
suitable explanation to TRAI for raising tariffs – as the telecom authority
smelled foul play involved in this, greenfield operators said that they too
were contemplating hiking 2G tariffs, to sustain themselves in a fiercely
competitive Indian telecom market. Leading operators also petitioned DoT to put
a cap on the number of operators in India. Severe competition started affecting
profits of all operators.


Though the uptake for 3G has been slower than expected in
the six months since its launch in India, the market for 3G is expected to
touch $1.8 billion by 2015, with the 3G subscriber base expected to increase
from the current 10 lakh-odd subscribers to 16 million by 2012. Keeping this in
mind, as well as with an aim to recover ROI on 3G, other 3G operators are also
likely to slash 3G tariffs, as they did earlier in the case of per-second
billing and 2G tariffs.


By Beryl M
[email protected]