Tata Indicom's 'Pay Per Call' Tariff Plan for Prepaid Cellular Subscribers


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Case Details:

Case Code : MKTG247
Case Length : 17 Pages
Period : 2005-2009
Pub Date : 2010
Teaching Note :Not Available
Organization : Tata Teleservices Ltd
Industry : Telecom
Countries : India

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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"With the Pay Per Call offer, Tata Indicom has changed the very currency of pre-paid mobile tariffs. While a customer typically pays Re. 0.01 per second, or Re. 0.30, or Re. 0.50, or Re. 11 as call rates per minute, depending on the tariff plan they have chosen with various telecom service providers, they will now be charged a flat rate of Re. 1 for any local call, and Rs. 3 for any STD2 call, regardless of the call duration3 ! This will change the very perception of charging, as seen by telecom subscribers today."4

- Vineet Bhatia, Chief Operating Officer (COO), Delhi & National Capital Region (NCR), Head - North Region, Tata Teleservices Ltd., in September 2009.

"Reliance5 pioneered the mobile revolution making calls cheaper than a postcard in 2005. In another game changing move today, Reliance brings a billion Indians closer to each other, with one single rate for all local and STD calls, to any mobile or landline network, anytime, anywhere in India, without any conditions or restrictions. Once again, Reliance has set new standards, offering unbelievable and never-before savings to a billion Indians."6

- Anil Dhirubhai Ambani, Chairman, Reliance Communications Ltd (RCom)7, in October 2009.

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1] Re. (singular) and Rs. (plural) denote the Indian Rupee (INR). Between September 2009 and January 2010, the exchange rate of the currency fluctuated between Rs. 49.50 per US dollar and Rs. 46.50 per US dollar.
2] Subscriber Trunk Dialing (STD): A synonym for national long distance (NLD) calls in India.
3] The DuPont Awards for Packaging Innovation recognize materials, processing, technology, and service achievements that demonstrate progress toward sustainability while also meeting important market requirements for enhanced performance such as improved freshness, convenience, and shelf appeal. The winners are judged considering seven criteria - lean production, effective recovery, community/social benefit, enhanced performance, cost effective economics, responsible sourcing, and resource and energy optimization.
4] "Tata Indicom "Pay Per Call" - Local Re.1, STD Rs.3 - No More "Per Minute" Charges!" http://telecomtalk.info, September 1, 2009.
5] Reliance Communications Ltd (RCom).
6] "Reliance Communications Redefines Telecom Industry Benchmarks," www.rcom.co.in, October 5, 2009.
7] RCom, one of the leading telecommunications service providers in India, had a subscriber base of around 85 million as of September 2009. It provided services in both the GSM and CDMA networks. Source: www.rcom.co.in.


 

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