With mobile telephony and wireless in local loop (WiLL) technology ringing loud and clear, spare a thought for the good old fixed phone.
Market sources indicate that while the off-take of cellular handsets has been growing at around 20 per cent per month, the past four months have seen near-stagnation in the sales growth of fixed phone sets. And all major brands — both local and global — appear to have suffered because of consumer preference that is “heavily loaded” in favour of mobile phones.
“We import fixed phones and cordless phones from our manufacturing facilities in Singapore and Japan to cater to the local market. But following the drop in demand, we have cut down on our imports by around 30 per cent,” says Souvik Sarkar, senior territory manager, Panasonic.
And it’s not only premium brands like Panasonic, Sony and BPL. Low-priced local brands like Orpat and Beetel have also posted “lower” growth figures.
This, despite the fact that a significant part of fixed phone sale results from replacement of older sets, parallel connections and EPABX connections in offices. “But still, the market growth lags significantly behind that of cellular handsets,” says Anil Agarwal of ABL Sysems.
Ajit Das of Nilachal Electronics in Chandni Market — the popular hub of electronic goods — echoes this view. “A few brands of sophisticated cordless sets are maintaining their growth, but most other brands are doing badly. The companies are giving various sops to increase their primary sales to dealers and distributors, but why should someone build up inventories if there isn’t adequate demand in the market'” he asks.
According to telecom industry observers, the lower growth of fixed phones in comparison to the cellular market — which has more than doubled in a year’s time — can be attributed to a number of factors, led by the higher growth potential of cellular phones.
“All members of a family can carry a cellphone each, but will keep just one fixed phone in the house. Besides the big-bang entry of wireless in local loop (WiLL) technology, the past six months have also witnessed cell operators slashing tariff and GSM handsets becoming cheaper,” explains Panasonic’s Sarkar, now focusing on mobile handset sales, under the changing market conditions.
Data available with Bharat Sanchar Nigam Limited (BSNL) indicates that the fixed phone market — with around 1.4 million customers in the city — is nearing saturation.
“From 200,000 new connections in 2000-2001, the number of new connections slipped to 110,000 last year. Since we offer all three services — basic, WiLL and cellular — a significant number of our potential new customers are weighing the option of going cellular or taking a WiLL connection,” says R.K. Mishra, general manager, customer relations and operations planning, BSNL.
Mishra, however, adds that the public sector telecom behemoth is intensifying efforts to expand the fixed-line market in the city. Besides offering a host of free facilities — caller line identification, call divert, call waiting, conferencing, dynamic locking — BSNL is also working on bringing down the waiting time for a new connection. “We are doing our best to retain the market and expand it,” clarifies Mishra.