The Telegraph
Since 1st March, 1999
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Private firms go places in cell sweep

New Delhi, Feb. 27: Let’s call it the Great Mobile Shift. Indians are reaching out to grab cellphones and are showing an increasing preference for private telecom service providers.

These are the two stark trends in the world of communications: 63 per cent of all new telephone connections in April-December 2002 were cellphone connections. That’s a sharp leap from the 43 per cent recorded in the year-ago period.

The number of new connections for basic phones (that includes wireless in local loop or WiLL phones) fell to 1.9 million in April-December 2002 from 2.6 million in the corresponding period of the previous year.

The other story is hidden in the arcane terminology of teledensity, which is the number of phone lines per 100 persons of the population. Teledensity, has improved rapidly from 3.6 in March 2001 to 4.9 in December 2002.

Reports suggest that most of the telephone users — cellular and fixed-line (including Wireless in Local Loop) — get their service from private operators.

This is a trend that will only accentuate over the next few years. Moreover, the trend will skew only further towards mobile phones if you take WiLL phones out of the basic phone category and club it with cellular phones because that is where they truly belong.

Secondly, as limited mobility players like Reliance and Tata Teleservices aggressively scout for customers, the shift in the balance — which began this year — will become even more pronounced.

The Telecom Regulatory Authority of India’s decision to provide greater thrust to mobile telephony against the fixed line telephones in its recent tariff restructuring has been officially acknowledged by the government in the Survey.

The Survey has pointed out that the reduction in national long distance (STD) and international long distance (ISD) tariffs by 56 per cent and 47 per cent, respectively, and the 70 per cent drop in the cellular-to-cellular STD tariffs has provided the necessary thrust to the shift.

The Survey says the cellular connections grew by over 73 per cent in the first nine months of this year over the year-ago period.

Private cellular companies grew by 74.8 per cent during the April-December 2002 as against the 19.8 per cent growth by public sector telecom majors Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL).

With falling tariff rates for cellular phones, there has been a phenomenal increase in the number of cellular subscribers.

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