28.3.10

Videocon rings in mobile services

The Videocon Group became the 13th mobile operator in India with launch of its GSM services in Chennai on Thursday. The group plans to roll out services in 100 cities and towns in the next 100 days and be a pan-India player by the end of September. “Although it may seem that the market is flooded with new players, the truth is that teledensity in India is still only 46%. So there is a large untapped market that we plan to target with our attractive plans,’’ said Venugopal Dhoot, chairman, Videocon Group. “With our target customer base of 100 million consumers, we want to be among the top three players in this market in the next three years.’’ Dhoot said the group “will invest Rs 14,000 crore over the next three years — Rs 7,000 crore has been allocated by SBI and the balance will come from equity and suppliers credit’’. The burgeoning mobile industry added 250 million subscribers in the last three years and is expected to touch 800 million by 2015. Playing on the price factor, Videocon plans to roll out a sub 1 paise tariff plan, the details of which are yet to be announced. “In this industry, you don’t make profits from day one. It’s a volume-driven business where value-added services too plays a significant role. Besides, the Videocon brand has always stood for value for money,’’ Dhoot said. “We hope to attract new users and once number portability comes in, we’re sure more people will migrate to our service.’’ Dhoot also said that the company has applied for 3G licence in about 20 circles. The company has access to around 70,000 towers in India — some company-owned, some shared — and eight call centres where customers can receive help in 15 languages. “We put our back-end in place before we launched. We will ramp up as our customer base increases,’’ said Dhoot. “We hope to break even in two years and then, we expect an internal rate of return of 20%.’’ The company has partnered with a host of companies like Nokia Siemens, Cisco, IBM, Wipro, Oracle, Unisys, Huawei, Amdocs, Gemalto, Avaya, Comverse, Acision and Comviva. The brand plans to set up 50,000 outlets within one year, including the group’s retail chains Next and Planet M. Videocon is eyeing the rural market: “That is where the numbers are. Besides, our brand recall is very high in these areas. We already have a strong network of service centres there,’’ said Dhoot. He is also open to the idea of doing a Sunil Bharti Mittal. “We are a strong company and when we spot an opportunity, maybe in two years or so, we would certainly consider it,’’ he said.

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