You are on page 1of 38

A REPORT ON

A Study of Buying and Usage Behavior

of Mobile Service Providers

by

ARPITKUMAR M. MANKAR

Under the Guidance of

Prof. DILIP JOSHI

INSTITUTE OF MANAGEMENT AND COMPUTER


STUDIES, THANE

1
A REPORT ON

A Study of Buying and Usage Behavior of Mobile Service


Providers

Submitted By

ARPITKUMAR M. MANKAR

(MS0809073)

Under the Guidance of:

Prof. DILIP JOSHI

A Project Report submitted in partial fulfillment of the requirements of

THE MMS PROGRAM (Class of 2009)

INSTITUTE OF MANAGEMENT AND COMPUTER STUDIES, THANE

2
CERTIFICATE

This is to certify that Mr. ARPITKUMAR MANKAR is a bonafide student


of Master of Management Studies (MMS) program of this institute for the
academic year 2009-2010

He has successfully completed the project work towards partial fulfillment


of Master of Management Studies (MMS) degree course on the topic

A Study of Buying and Usage Behavior of Mobile Service Providers

_________________ _________________ _________________

Signature Signature Signature

(Internal Guide) (External Examiner) (Director)

3
DECLARATION

I do hereby declare that the project entitled “A STUDY OF BUYING AND USAGE
BEHAVIOR OF MOBILE SERVICE PROVIDERS” has been prepared and
submitted as a part of the curriculum for the degree of Master in Management
Studies (MMS), ASM’s Institute of Management and Computer Studies, Thane.

I also declare that the dissertation is the result of my effort and has not been
submitted to any other organization or university.

ARPITKUMAR MANKAR

MMS II (MARKETING)

(MS0809073)

4
Contents
CHAPRTER 1: INTRODUCTION ............................................................................... 10

1.1 Introduction ............................................................................................................. 10

1.2 Background ............................................................................................................. 12

1.3 Objectives of Study ................................................................................................. 12

1.4 Rationale behind the study ...................................................................................... 13

1.5 Scope of Study ........................................................................................................ 13

CHAPTER 2: LITERATURE REVIEW...................................................................... 15

CHAPTER 3: RESEARCH METHODOLOGY ......................................................... 17

3.1 Research Design: .................................................................................................... 17

3.2 Sampling Procedure: ............................................................................................... 17

3.3 Data Collection: ...................................................................................................... 18

3.4 Questionnaire Design .............................................................................................. 18

3.5 Limitations .............................................................................................................. 19

CHAPTER 4: RESEARCH FINDINGS ....................................................................... 20

CHAPTER 5: RECOMMENDATIONS ....................................................................... 34

CHAPTER 6: CONCLUSION....................................................................................... 36

References ......................................................................................................................... 37

5
ACKNOWLEDGEMENT

The study carries impression of many who helped in making this project a success, who
helped me by giving valuable feedback and suggestions from time to time.

I would like to thank Prof. Dilip Joshi for his valuable guidance at every step during
preparation of this project through valuable support and feedback whenever needed.

I would also like to thank the library staff of Institute of Management and Computer
Studies, for their help and cooperation they have provided with various books, magazines
and journals while preparing this report.

Finally, I would like to thank all friends and other teaching and non-teaching staff of
Institute of Management and Computer Studies, for their emotional and other support
they gave from start to end of my project.

6
Lists of figures and illustrations:

Fig. 1: Bar graph of ‘Top-of-Mind’ share for customers of mobile service providers

Fig. 2: Buying Behavior of consumer of mobile service provider

Fig. 3: Parameters rated 1 to 5 (1 being lessat important adn 5 being most important)
while buying a sim card

Fig. 4: Amount of money spend per month on mobile recharge

Fig. 5: Time spend talking per day on mobile phone

Fig. 6: Individual preference for a call

Fig. 7: Time preference of an outgoing call on weekly basis

Fig. 8: Topic/ subject of discussion

Fig. 9: Various parameters on which duration of call depends

Fig. 10: Subject of SMS sent on weekly basis

Fig. 11: Individuals to whom SMSs are send in a week

Fig. 12: Graph showing number of individuals having GPRS enabled phones

Fig. 13: Graph showing number of customer using GPRS in GPRS enabled phone

Fig. 14: Graph showing amount of data downloaded per week in MB

Fig. 15: Purpose of using GPRS

Fig. 16: Plans used for GPRS by consumers

7
Abbrivations and keywords

MoU: Minutes Usage

ARPU: Average Revenue per User

VAS: Value added Services

CDMA: Code Device Multiple Access

GSM: Global System for mobile communication

Mobile Service Providers, SMSs, GPRS, call rates,

8
Abstract

The telecom industry is one of the fastest growing industries in India. India has
nearly 400 million telephone lines making it the second largest network in the world after
China, with a growth rate of 40%, Indian telecom industry has the highest growth rate in
the world. Opening up of international and domestic long distance telephony services are
growth drivers in the industry. Cellular operators now get substantial revenue from these
services, and compensate them for reduction in tariffs on air time, which along with
rental was the main source of revenue. The reduction in tariffs for airtime, national long
distance, international long distance, and handset prices has driven demand.

The research done is exploratory type. There are various factors on which
consumers use their mobile service providers. These factors have been studied through
various cities and various consumers through questionnaires. These questionnaires were
sent through e-mails. Analysis of data was done through graphs and charts. Different
factors, their importance and growth area in each sectors was found out in this research

9
CHAPRTER 1: INTRODUCTION

1.1 Introduction

Over the past few years, the Indian mobile market has recorded an exponential
growth that has exceeded the expert’s expectations. The Indian mobile subscriber base
grew by approximately 48.5% in 2008 (http://wirelessfederation.com/news/14151-india-
welcomes-2009-with3469mn-mobile-subscribers). The low call rates, affordable mobile
handsets, and the changing socioeconomic status of the customers along with the
regulatory reforms have resulted in the Indian mobile sector to expand from around 10
million subscribers in 2002 to reach 370 million by 2008
(http://www.theindusview.com/Telecom.html).

The GSM players constitute 75% of the total market with Bharti-Airtel, BSNL,
Vodafone, and Idea being the major players. The Code Division Multiple Access
(CDMA) players such as Reliance and Tata Indicom have maintained a reasonably stable
market share of 25% over the past few years (Business Standard, April 2009). Bharti-
Airtel is the market leader with about 23.2% market share and has recently crossed 100
million subscription base (Hindustan Times, June 05, 2009). According to a report by the
global consulting and research firm, Gartner Inc., the Indian mobile service is expected to
grow at a compounded annual rate of 18%, exceeding 700 million subscription base by
2012 (Business Standard, July 02, 2008)

Market is estimated at $26 bn with the mobile penetration to increase by 38% by


2011 (www.reuters.com). The rural penetration would reach 58% in 2011 up from an
abysmal 2% in 2006. The prepaid services would be an important driver for this
exponential growth and would account for 93% of the total subscribers. The bulk of the
market being voice services, the data services could make up as much as 30% with the
Average Revenue Per User (ARPU) falling to $59.5 from $82 by 2011 (The Financial
Express, July 19, 2007).

10
The average revenue per user (ARPU) for GSM service providers has declined by
12.4 per cent to Rs 144 in quarter ending December, 2009 from Rs 164 in the September
quarter. ARPU for CDMA players declined by 7 per cent to Rs 82 in quarter ended
December, 2009 from Rs 89 in quarter ended September, according to figures released by
telecom regulator TRAI.

Minutes of Usage (MoU) per subscriber for GSM mobile services declined by
2.82 per cent, from 423 in September quarter to 411 in December quarter, 2009.
However, there was an increase in MoU per subscriber for CDMA mobile services of 3.2
per cent from 308 in September quarter to 318 in December quarter, 2009.

The number of telephone subscribers in India increased from 509.03 million at the
end of September 2009 to 562.16 million at the end of December, 2009, registering a
growth of 10.4 per cent. The overall teledensity in India has reached 47.88 as on
December 31, 2009. (Business Standard, April 07, 2010)

11
1.2 Background

India is competing for global leadership, and within a few decades the effort will
become reality. Indian technological developments have largely been insulated from
episode of global technological inconsistencies, and over the year, India has built
resilience to shocks and now less vulnerable to output volatility. Technological level and
education standard are steadily growing, and almost all the state governments and central
government are heading toward a breakthrough in the field of communication
technology. This will make the way for advanced consumer satisfaction in all the fields.
There is an increase convergence in perception, institutional structure, choice of
instrument and communication strategy in telecom policy making. The government’s
dream of providing ‘urban service to rural areas’ will come true only if certain hindrances
are removed. This study is done during the month of February and March in various
urban cities across India to understand the consumer buying and usage behavior for
mobile service providers and problem they are facing. In depth study was undertaken to
analyze preference pattern, problem of cellular phone services.

1.3 Objectives of Study

• to understand various factors that are affecting the buying pattern of consumer of
mobile service provider
• to understand the usage behavior of consumer of various mobile services provided
by mobile service providers
• to understand various growth drivers that can be used by mobile service providers
for growth of the company

12
1.4 Rationale behind the study

In this competitive world each and every organization needs to be best in their
competitive area. Everyone utilize their all available resources which they are having.
The creativity factor is considered important in any advertising agency.

It is not enough to simply state a firm’s goal as maximizing the present value of
total profit since this does not differentiate it from other firms and says nothing
about how this objective is to be achieved. Instead, a business and marketing plan should
suggest how the firm can best put its unique resources to use to maximize stockholder
value. The company needs to give value to their products and services. This is done
through use of advertising agency.

Hence this study is done to know how various growth factors in mobile service
industry that will help the organizations to maximize their service usage and create a need
of their product and services in the mind of the customers. This is done by knowing the
type of consumer the company is working on and what is their present condition and
competitive environment in the market. Through questionnaire various factors are
considered and the usage and buying pattern of consumer will be projected.

1.5 Scope of Study

The study can help to know various factors that affect mobile service providing industry.
It also tells about various aspects that should be considered while preparing a marketing
plan. The research done in this study only relates to consumer perspective of the services
and hence no study is done with respect to service provider’s viewpoint. A related study
can be done for studying perception gap between mobile service provider and their
customers which could help to serve customer better.

Despite the significant advances in technology and mobile industrial research,


little is known regarding the impact of various factors and their outcomes under different
market conditions. Different market forces may jointly affect the market and outcome

13
relationship. Two market factors of particular interest to mobile service providers and
researchers are market dynamism and competitive intensity, which have received
heightened attention in recent research of firm performance because of accelerated
technology development and globalization of markets (Cui, Griffith, and Cavusgil 2005).
For mobile service providing industry, market dynamism and competitive intensity
constitute both market opportunities and challenges, and they are likely to moderate the
impact of same. The study can also help in understanding various market factors which
can affect growth of mobile industry. These can be market dynamics, competency,
technology etc.

The purpose of this study is to understand various factors that are affecting buying and
usage behavior of mobile service providers consumers. Thus, more studies can help in
examining the relationships of industry expectation on total market at different levels of
market dynamism and competitive intensity. Specifically, it can help in examining both
the linear and nonlinear relationships between the two and the outcomes of same.

14
CHAPTER 2: LITERATURE REVIEW

Debnath (2008) explains that the prime focus of the service providers is to create
a loyal customer base by benchmarking their performances and retaining existing
customers in order to benefit from their loyalty. With the commencement of the
economic liberalization in 1991, and with a view to expand and improve telecom
infrastructure through the participation of the private sector, the Government of India
permitted foreign companies holding 51 percent equity stake in joint ventures to
manufacture telecom equipment in India. The Indian Government has announced a new
policy, which allows private firms to provide basic telephone services. There had been a
monopoly of the state-owned department of telecommunications. However, several
companies are expected to benefit from the policy change.

Jha (2008), in his study analyzed that it is the youth which is the real growth
driver of the telecom industry in India. Considering this fact, the paper is an attempt to
give a snapshot of how frequently young people use their mobile phones for several\
embodied functions of the cell phones. Data was collected from a sample of 208 mobile
phone owners, aged between 20 and 29. The study sheds light on how gender, monthly
voucher amount and years of owning mobile phones influence the usage pattern of this
device. Findings of the study would be helpful for the telecom service providers and
handset manufacturers to formulate a marketing strategy for different market segments.

Kalavani (2006) in their study analyzed that majority of the respondents have
given favorable opinion towards the services but some problems exist that deserve the
attention of the service providers. They need to bridge the gap between the services
promised and services offered. The overall customers’ attitude towards cell phone
services is that they are satisfied with the existing services but still they want more
services to be provided.

15
Chris (2003) has analyzed ‘Telecom advertising in print media.’ This research
attempted to investigate why Telecom theme are used in advertisement, and the motives
that lead companies and advertisers to use sport celebrities and sport concept in
advertisements. From study it has been revealed that the appearance of sport celebrities in
advertising endorsement occurred more often in Telecom magazines than in other
magazines, because their target group is more acquainted with athletes. The sport
celebrities that dominated each printed media are related with their target group
characteristics.

Kalpana and Chinnadurai (2006) in their study titled “Promotional Strategies of


Cellular Services: A Customer Perspective” analyzed that the increasing competition and
changing taste and preferences of the customer’s all over the world are forcing companies
to change their targeting strategies. The study revealed the customer attitude and their
satisfaction towards the cellular services in Coimbatore city. It was found that
advertisement play a dominant role in influencing the customers but most of the
customers are of opinion that promotional strategies of cellular companies are more sale
oriented rather than customer oriented.

16
CHAPTER 3: RESEARCH METHODOLOGY

3.1 Research Design:

Exploratory research design is used in this study. The main purpose of the study is
formulating a problem for more precise investigation. The major emphasis in this study is
discovery of ideas and insights. This research design enables more flexibility in research
and study various aspect of problems under study.

The surveys of various literatures were done to understand various aspects related
to factors affecting the mobile service providers industry. This included survey of various
journals having Indian background and various texts related to advertising and creativity.
Articles from newspapers and magazines were also studies to understand the dynamics of
the mobile service providers market.

3.2 Sampling Procedure:

A sample design is a definite plan determined before any data are actually
collected for obtaining a sample from a given population. (Kothari, 2004) Probability
sampling, also known as random sampling or chance sampling was used for selection of
various samples. In this it ensures the law of Statistical Regularity which states that if on
an average the sample chosen is random one, the sample will have same composition and
characteristics as that of universe. The sample chosen were from metro cities and few
Tire-1 cities of India. These cities were New Delhi, Mumbai, Pune, Bengaluru, Raipur
and Nagpur.

17
3.3 Data Collection:

a. Primary data: Simple random sampling was done to get the responses from the
samples. The data was collected through questionnaire. The questionnaire was
send through e-mails to all respondents. The questionnaire was in structured
format wherein there is definite, concrete and pre-determined questions. The
questions were presented with exactly same wording and in the same order to all
respondents.
b. Secondary data: Secondary data are data that are already available. Following
published data were used for getting secondary data:
a. Technical and Trade Journals
b. Magazines and newspaper
c. Reports and publications of various associations connected to mobile
service providers industry
d. Reports prepared by research scholars and universities etc.

3.4 Questionnaire Design

Understanding consumer perceptions, needs and usage of mobile service


providers was the main aim of the questionnaire. Designing a questionnaire for the same
is not as easy as it looks at first sight (Beri, 2003). Primary data has to be extremely
careful in deciding what information is to be collected, questions to be formulated and the
sequence of the questions.

Combinations of open and close ended questionnaire were used. Open ended
questions were used for knowing various needs, preferences and choices for various
parameters of mobile service providers etc.

18
Close ended questions were used to know other aspects which were related to
mobile parameters and their ratings. Ratings were done to know the importance of
various factors that are affecting the mobile service providing industry. Questionnaires
were in structured format and were sent through e-mails.

3.5 Limitations

All the studies have limitations. First, this study was conducted for only few
major cities in India. The lifestyle and living cost of each of these cities differ in itself.
Also individuals differ from each other. The study was mostly concentrated on urban
lifestyle and rural usage was not studied in this study. It has been seen that most of the
rural market is been developing day by day. Because of low cost per call and SMSs
eventually, mobile service market is been concentrating more on rural market today.

This study only deals with the usage of mobile service providers in urban areas.
Studies can be done to know the rural market and the usage of same in these areas. There
can be wide difference in buying and usage pattern of both these studies.

Moreover only people from age group from 20-40 was selected for study. Both
the age group, below 20 years and above 40 years, did not respond to the questionnaire.
Therefore it cannot be said that the results from the study is also applicable for all age
groups. Since the lifestyle, work culture and peers and groups of both age group differ
completely from age group of 20-40, results may vary for these both age group.

19
CHAPTER 4: RESEARCH FINDINGS

The responses of the questionnaire from the customers are been described through
graphical representation below. The responses state the buying and usage behavior of the
customers on more or less large scale.

Q1. Listing the name of mobile service providers customers know

Fig. 1: Bar graph of ‘Top-of-Mind’ share for customers of mobile service providers

Question of listing the names of mobile service providers, that a customer, know
was done to know the ‘top-of-mind’ share of various service providers among customers.
From the responses given, it can be seen that Vodafone and Airtel has close competition
for top of mind share amongst customers. Both these brands are well know and are in
close competition with each other.

20
A number of new mobile players have entered the market over the past year
offering low tariffs forcing incumbent players to join the price war. Bharti Airtel's market
share declined from 24.7 per cent to 22.7 per cent during the period even as its share of
net additions fell from 25.9 per cent in 2008 to 15.9 per cent. (The Hindu, January 22,
2010)

Q2. Statement which describes consumer while buying a mobile sim

Fig. 2: Buying Behavior of consumer of mobile service provider

Bar 1: Consumers gather information from net and then decide the service provider.

Bar 2: Consumers buying depends on sim their family/ friends / relatives use.

Bar 3: Consumers discuss with colleagues, friends and family before buying a sim.

Bar 4: Consumer know enough to make their own decision about service providers

Bar 5: Consumers know about every service providers, their offers and what they are
buying

21
Most of the consumers before buying a mobile sim, likes to discuss with friends and
family and then choose a mobile service providers. Also customers are themselves aware
enough to make their own decisions. Other than consulting friends and family members,
most people are either aware of various service providers, their offers etc. or like to find
themselves through sources like internet.

This decision made is however not so quick because of two reasons:


a. Customers don’t like to change their service provider once they start a service
b. Instead of low investment initially, they like to think on other parameters such as
services, offers, coverage strength etc.

Q3. Importance of various parameters while buying a sim card

Fig. 3: Parameters rated 1 to 5 (1 being lessat important adn 5 being most


important) while buying a sim card

22
It can be seen from the graph that the most important factor customers considers
while buying a mobile sim card is the local call rates (77%). On the other hand, no
respondent considers advertisements or roaming charges as important factor while buying
a sim card.

On the other hand, advertisements are rated as least important factor considered
while buying a mobile sim card (40%). The other important factors which are considered
very important for buying a sim card are coverage area (50%) and local SMS rates (39%).
Similarly local SMS rates and coverage area are the other two important factor to be
considered by respondents (37%).

Q4. What amount of money is spending on mobile recharge per month?

Fig. 4: Amount of money spend per month on mobile recharge

23
Q5. Time spend per hour talking on mobile phone

Fig. 5: Time spend talking per day on mobile phone

Q6. Rating on the basis of number of calls made to different individuals on weekly basis.

Fig. 6: Individual preference for a call

24
The graph states that most of the people (48%) make calls to their best friends or
loved ones on daily basis. Other customers (34%) makes call to their friend on same
basis. The rest 28% of customers like to call their parents or brother and sister on daily
basis. Similarly about 19% of people makes call to their brother or sister rarely.

Often call are made to friends, colleague and parents (70%). There is not clear
variation between individuals to whom calls are been made rarely and to whom calls are
been made often. This differs from person to person and also on various other factors.

Q7. Rating for time preference for a call made by individuals on weekly basis

Fig. 7: Time preference of an outgoing call on weekly basis

25
The graph shows the time preference for a call made by customers on weekly
basis. It is seen that most of the calls are done from 7pm to 11pm (58%). On the other
hand there are very rare calls done from 1 am to 9am (80%). On an average most people
like to make a call from 9am to 7pm.

Q8. Topic or Subject of discussion for a call

Fig. 8: Topic/ subject of discussion

The topic of discussion is very vast and ranges on wide basis for making a call.
This can range from general inquiry to personal issues (Tecor and Jha, 2008). Mostly
people talk on general issues (30%). Other reason why customers make a call is to ask
information, to ask about their friends and loved ones. On the other hand there are equal
numbers of people who talks very often and who rarely talk about best friends and loved
ones (22%).

26
From the graph it can be concluded that there is no specific topic which a person
wants to discuss with other person. It can be seen that there are almost equal number of
responses (18-21 respondents) who likes to talk very often on information, news and/or
about loved ones and friends.

Also when one makes a calls, there are no fixed topics for calls and a call may be mixture
of various topics on different range depending on duration of call (Tecor and Jha, 2008)

Q9. Various parameters on which duration of call depends

Fig. 9: Various parameters on which duration of call depends

From the graph it can be seen that mostly it’s the person, individual who is talking
to, on whom duration of call depends. It can be seen that 65% people state that their
duration of call depends on individual to whom they are talking.

27
Also, 39% of people state that their duration of call rarely depends on service
provider and their call charges. Other two factors which determine the duration of call are
work they are involved in and time of call.

Q10. Subject of SMS

Fig. 10: Subject of SMS sent on weekly basis

The SMSs send vary and are here classified into four major categories viz:
inquiry, greetings, entertainment and information.

Most people like to make inquiry about individual through SMS (40%). These are
questions which involve where, how, what and why about recipient of SMS. Other
important subject of sending SMSs are entertainment like seasons, days and celebration,
jokes questions etc. This constitute of about 38%. Equal numbers (30%) of people ask
about information like news, update, questions etc. on average basis on SMS.

There are only 19% people who ask information on very rarely basis and prefer to
make a call instead of SMS.

28
Q11. Individuals to whom SMSs are send

Fig. 11: Individuals to whom SMSs are send in a week

From the graph it can be seen that most of the SMSs are sent to best friends and
loved ones and friends (51% each). These SMSs vary in subject from general information
to greeting and entertainment.

There were no individuals who sent SMSs on often basis to their parents. On the
other hand SMSs sent to parents are on very rare basis (84%). On average most people
send SMSs to colleagues (47%) constituting of information and questions about work or
greetings SMSs. Also on very rare basis or on sometimes basis SMSs are sent to brothers
and sisters (64%).

29
Q12. Is the phone used GPRS enabled?

Fig. 12: Graph showing number of individuals having GPRS enabled phones

Q13. Do customers use GPRS in GPRS enabled phone?

Fig. 13: Graph showing number of customer using GPRS in GPRS enabled phone

30
Q14. Amount of data downloaded per week

Fig. 14: Graph showing amount of data downloaded per week in MB

It can be seen from the graph that there are almost 57% people download less than
9 MB per week data per week. This contradicts the statements and usage pattern
predicted by mobile service providers after introduction of GPRS enabled phones in
Indian market which states that the mobile service providers are expecting the usage of
net to increase on mobile and will prove to be major competitor to internet service
providers (Chris, 2003). There are very less people who download data more than 20
MB per week (18%).

31
Q15. Purpose of using GPRS

Fig. 15: Purpose of using GPRS

It can be seen that mostly people use GPRS for checking mails and for chatting
(30%). Also it is closely followed by surfing internet for fun and getting news and
updates from various sectors.

Also it can be seen that there are many people who don’t prefer GPRS for
downloading files from internet. Only 10% people use it on frequent basis and 44%
people rarely download file from internet.

32
Q16. Plans of GPRS used

Fig. 16: Plans used for GPRS by consumers

It can be seen that 52% of people use unlimited download plans for using GPRS. Other
48% use plans which are based on amount of data downloaded from the internet.

33
CHAPTER 5: RECOMMENDATIONS

There are various factors that are affecting usage of mobile service provider. The
study done was conducted in few urban cities and in age group of 20-40. Indian mobile
service industry sees growth in the Minutes of Usage (MoU) in teen and mid twenties
(Indian mobile services market to exceed $25 bn, The Financial Express, July 19, 2007.)
Overall growth of industry depends on various drivers that combines together and gives
the end results. The recommendation given below includes some of the factors that are
major contributors that affect mobile service providing industry.

• Separate plans should be made for people who are using mobile in more than one
state. In other words various plans for roaming should be developed to encourage
the same

• It can be seen that advertisements made does not influence the buying behavior of
the consumer. Mobile service providers are concentrating on making brand in the
market. This can be seen from the ‘top-of-mind’ shares which constitute two
major brands - Vodafone and Airtel. Mobile service providers should also
concentrate on making advertisements which can encourage to buy sim along
with creating brand name in the market.

• Minutes of Usage (MoU) per subscriber for GSM mobile services declined by
2.82 per cent, from 423 in September quarter to 411 in December quarter, 2009.
However, there was an increase in MoU per subscriber for CDMA mobile
services of 3.2 per cent from 308 in September quarter to 318 in December
quarter, 2009 (Business Standards, April 07, 2010).

• Thus it can been that there is low spending on mobile recharge, which does not
depend on other parameters. More efforts should be taken to increase Minutes of
Usage (MoU) to increase the Average Revenue per Usage (ARPU).

34
• It can be seen that calls and SMSs are rarely been made for family and relatives.
Selected schemes can be structured to encourage calls for parents, brothers and
sisters and other relatives. Also it can be seen that duration of calls mostly
depends on person to whom individual is talking.

• Most of the calls are made from 6pm to 11pm. The calls done from 1am to
morning 7am are done in very rare cases. There are various schemes available like
low call rates, free night calling etc given by various service providers. But people
don’t call at these times. More efforts should be done to take measures for
increasing Minutes of Usage (MoU) during these time slots.

• Almost 60% of people use GPRS enabled phones but are not using GPRS or use
in very rare cases. The net downloads per week are less than 9 MB. This may be
due to monthly charges or speed or both. Measures should be taken to increase the
internet usage on mobile.

35
CHAPTER 6: CONCLUSION

India has one of the lowest mobile phone tariffs in the world resulting in low
Average Revenue Per User (ARPU). The problem is that despite the average use of
mobile phones being the highest at 287 minutes a month, India has an average rate per
user (ARPU) of around $8 compared to global average ARPU of $ 21. There was a
decline of 7.4% in ARPU in 2005 since 2004. The ARPU would continue to drop by
about 5% while tariffs will decrease further by 15%. (Businessworld magazine, Industry
News, October 2008)

Indian market lacks behind in terms of Per minute Cellular tariffs (2.5 cents per
minutes) as compared to other countries such as China (3.5), Nepal (8.4) and Maldives
(14.4). On the other hand there is growth of 16% in the mobile service provider industry
(Telecomm Regulatory of India).

There are very few Value Added Services (VAS) which consumers use other than SMSs
or GPRS. These services include mobile music, mobile video and animations, mobile
contest and voting, mobile gaming, mobile alerts etc. These services and again their isafe
can differ from place to place and from person to person. Appropriate measures such an
sub-segmentation on the demographic and geographical basis can make a mobile service
provider company to penetrate more in market and thus can help to make strategic and
profitable decisions.

36
References
1. India welcomes 2009 with 346.9 million mobile subscribers,

http://wirelessfederation.com/ news/14151-india-welcomes-2009-with-3469mn-

mobile-subscribers

2. http://www.theindusview.com/Telecom.html

3. Highest ever GSM additions in March, Business Standard, April 14, 2009.

4. Airtel crosses 100 million mark, Hindustan Times, June 05, 2009.

5. Gartner Predicts Indian Cellular Services Market to Surpass $37 bn by 2012,

Business Standard, July 02, 2008

6. Gartner sees rapid growth in Indian mobile market, www.reuters.com, July 18,

2007.

7. Indian mobile services market to exceed $25 bn, The Financial Express, July 19,

2007.

8. CyberMedia’s Voice and Data Mobile User Satisfaction Survey 2008 Reveals,

http://www.pressreleasepoint.com, June 16, 2009.

9. Fornell Claes (2008), The Satisfied Customer: Winners and Losers in the Battle

for Buyer Preference, Palgrave Macmillan.

10. Debnath, Roma Mitra, “Benchmarking telecommunication service in India”, 2008

11. (http://www.emeraldinsight.com/Insight/viewContentItem.do;jsessionid=236E2B

6B45CF101465D540FD4401AEB9?

contentType=Article&hdAction=lnkhtml&contentId=1742535&history=true>)

[Viewed 03/03/10]

12. Kalwani, Banumathy, “Consumer’s Attitude towards Cell phone Services”, 2006

37
13. Kumar, Kaliyamoorthy, “Influence of Demographic Variables on Marketing

14. Strategies in the Competitive Scenario”, 2007

15. (http://www.emeraldinsight.com/Insight/viewContentItem.do;jsessionid=2086527

F0757A565F9A6CBAC8800F658?contentType=Article&hdAction=lnkhtml&co

ntentId=881588&history=true>) [Viewed 04/03/10]

16. Tecor, Jha, “Understanding Mobile Phone Usage Pattern among College-Goers”,

2008

17. (http://www.emeraldinsight.com/Insight/viewContentItem.do;jsessionid=2086527

F0757A565F9A6CBAC8800F658?

contentType=Book&hdAction=lnkhtml&contentId=1760544&history=true>)

[Viewed 07/02/10]

38