Friday, December 17, 2010


Below is an article from the Economic Times - 4 December 2010.
All new telcos have less than 50% active users, finds Trai - The ...

The Pre-paid/ Pay as you go segment dominates the mobile phone telecom sector in India.

With record-low tariffs and cut throat competition, telecom companies are hoping to regain earnings traction via 3G services!

Furthermore, we may be headed for a 3G price war as well.
The percentage of active subscribers is far too low in the case of many of the new entrants. Some of the new players will gradually find the current tariffs unviable for their business models, and a consolidation is likely.

This is clearly an overcrowded market. In the meantime, expect the established incumbents to aggressively defend their market share. This will result in reduced profitability in the near term, until an inevitable consolidation occurs/ some players exit the market altogether.

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