Good news

New Delhi, March 18: Telecom service providers are betting on low-priced prepaid lifetime plans to connect to new customers.

Aircel Cellular, the fifth largest GSM mobile service provider in the country, today introduced a prepaid lifetime validity scheme with call rates as low as 40 paise a minute.

“The plan available for Rs 99 allows users to make local calls at Re 1 for the first minute, 60 paise for the second minute and 40 paise for the third minute onwards,” said Gurdeep Singh, chief operating officer of Aircel.

Aircel expects to add around 30 million subscribers by December 2009, up from 17 million at present.

Reliance Communications, which entered the GSM (global system for mobile communications) platform in December 2008, is offering lifetime validity and double talk-time benefits for Rs 26. In some circles, the operator also offers free talk-time worth Rs 900 spread over three months.

R-Com president (wireless) S.P. Shukla said, “The company will launch more prepaid plans offering maximum value to various customer segments in the GSM market.”

According to analysts, telecom players are offering such low tariff plans to acquire new customers at a faster pace and become eligible for additional spectrum when the government hands it out later this year.

“New GSM players are indulging in a tariff war to attract new customers and attain a minimum subscriber base necessary to bag additional spectrum as and when it is available,” said Mahesh Uppal, director and telecom analyst of Comfirst, a consultancy firm.

According to DoT rules, new GSM operators with a subscriber base of 0.5 million are entitled to receive an additional spectrum of 1.8MHz.

Analysts do not expect the lower tariff plans to have any significant impact on existing players as users are averse to change. However, Bharti Airtel, Vodafone and Idea have all slashed tariffs on several entry-level schemes in the pre-paid segment.

Bharti Airtel has also reduced prices of a new lifetime connection to Rs 99 with a minimum recharge option of Rs 200 in six months. “The lower price point of Rs 99 will help a large number of uninitiated rural consumers to go mobile,” said Sanjay Gupta, chief marketing officer (mobile services) of Bharti Airtel.

Vodafone and Idea, too, have reduced the entry price for new connections. Vodafone has slashed the cost of lifetime-prepaid schemes to Rs 199 compared with Rs 270 earlier. The company has, however, done away with lower tariff charges offered earlier with such connections.

Similarly, an Idea Cellular user can now buy a lifetime prepaid connection for Rs 199.