Uninor in India – Seven Circles, 29 Paisa a Minute [Predatory Pricing?]

Telecom tariff war is in and as we mentioned earlier, Uninor has launched it’s GSM service in India (they are the 8th GSM operator in India).

The launch, as the company claims is the largest single day launch in telecom history, as the service is now available to 550 million people, i.e. 7 circles – Karnataka, Kerala, Andhra Pradesh, Tamil Nadu, Bihar & Uttar Pradesh (East & West).

Uninor Pricing

Uninor will be retailed at 210,000 point of sale via ~1000 distributors – the company offers two plans, ‘talklonger@29p/min’ and ‘Callmore@29p/min’.

While other telcos are bringing down the pricing from 1 paisa/sec to 0.5 paisa/sec, Uninor raises the bar with 29p/min (which is still lower than 0.5p/sec).

TalkMore offers local calls @29 p/minute (with setup charge of 39p), while Callmore offers calls at 29 paise and STD at 49 paise per minute, with a daily rental of Rs2.

DoCoMo and now Uninor – lets hope we don’t compromise on the network quality.

Predatory Pricing

New telecom operators, DoCoMo and Uninor are changing the rules of the game and Bharti CEO has even asked TRAI to look into the predatory pricing strategy by new telecom operators to woo customers.

“Trai should look at predatory pricing… The current tariff structure is lower than the cost structure of operators. Clearly, tariffs have to be sustainable in the long run.

And as one telcom puts it aptly:

When Trai wanted all telcos to provide the per-second billing option, large operators opposed the move and sought that tariffs be left to market forces. But, when market forces take over, they want the regulator to step in. Any reduction in tariffs benefits customers and therefore their stance is anti-consumer” – ET

Will Indian telecom incumbents lose out to new players, owing to their resistance to change? Remember the days when even incoming was charged and incumbents like Bharti sucked the blood out of customers until Reliance came in and changed the game?

What’s your opinion on Bharti’s ‘predatory pricing’ story against the new players?

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