How it all started for you in Videocon?
We are a part of the Videocon Group, one of the largest and best known business houses in India, having diversified business lines. Through its businesses, the Videocon Group has established one of the widest consumer electronics retail networks in India with over 25 years of brand equity. As a part of the 25000 Cr Videocon Group, we ventured into the telecom business in 2010 acquiring PAN India license and started phased roll-out. By Apr 2011, we had 8 operational circles including Mumbai, Tamil Nadu, Gujarat, Haryana, Kerala, MP, HP and Punjab. We achieved a milestone of 21% Incremental Revenue Market share in Q3, 2010-11. However, the telecom Industry went through a regulatory setback with the 2G scam. Despite having received a clean chit from CBI, our telecom licenses were cancelled vide Supreme Court order dated 1st February 2012, except for the Punjab Circle.
We then made a strategic comeback in the telecom sector after successfully bidding for 6 circles in early 2013. These circles are Haryana, Gujarat, MP, UP(E), UP(W) and Bihar (Punjab circle was already operational). The objective in mind was to cover the Hindi speaking belt of the country covering 47% of the total population. This Hindi belt accounts for 31% of the total Revenue Market Share of the industry and 39% of the total Customer Market Share of the industry. We resumed our operations in early 2013 in 3 out of the 6 new licenses acquired. Videocon Telecom is currently operational in 4 circles, namely, Punjab, Haryana, Gujarat and MP with a clear plan to launch the rest of the three circles, UP(E), UP(W) and Bihar in the coming financial year.
What are your plans and ambitions for Indian mobile and telecom market for coming years?
Our immediate plan is to roll out voice services in the remaining 3 circles, i.e. UP(E), UP(W) and Bihar within 1 year. Further, we plan to become the first telecom company to roll out 4G LTE FDD services on the 1800 MHz spectrum in the country. Our ambition is to ensure fair customer market share and revenue market share in our operating circles within the next 2 years and to become EBITDA positive within next 1 year and hold the distinction of being the fastest EBITDA positive telecom company.
And of course, we have the ambition to become a pan-India again. Videocon Telecom had been a pan-India player in the past and aspires to become one once again, but in a phased manner. Right now, we will have a strategic presence in seven circles, which is the Hindi-speaking belt of the country. Once we successfully roll out all these circles, we shall definitely look at acquiring spectrum for new circles, however, in a phased manner, by picking select circles in one go and eventually expanding, forming a corridor.
How are you looking at this competitive market in India?
With 7 to 10 telecom companies competing in the market place, there sure is fierce competition with everybody trying to grab the biggest pie in the share of New Adds. Beyond the first time users, the market primarily is a churn market with the deal seekers taking advantage of the low MOPs, tariffs and freebees advantage to avail new connections and hop from one brand to other. The incumbents had the first mover advantage and have acquired a substantial subscriber base, primarily the stable and high usage category, which leaves new players like us to struggle with the deal seekers.
However, there is a room for everybody in the market place. Our strategy is to go through the price warrior route and offer the best value for money tariffs to our customers to ensure acquisition and engagement. The way I see is, telecom business is a minute (time) factory and owing to our production background, we are very cost-conscious, which gives us an edge over others. Our expertise on cost control and the latest network allow us to produce minutes at a much lower cost compared to users. We have demonstrated that we are able to pass on this benefit to customers in the form of comparatively lower prices. Our tariffs are much better than competition and we would continue to offer 20-25% better value than others.
Further, I feel that data will be the next significant growth driver for the industry and first mover advantage here too will be instrumental. While we missed the bus when it came to taking the first mover advantage on basic voice, we would ensure that we take the first mover advantage on data front with the rollout of next gen 4G LTE FDD services in the country on the popular 1800 MHz spectrum for the service.
According to you what will be the next big thing that will happen in the mobile market in the near future and how India is ready for that?
Data will be the next BIG thing in the mobile market …world is gearing up for the upcoming 4G revolution and India is not far behind. The device ecosystem is fast developing and which would give the Indian telecoms a good head start. India telecom market is untapped when it comes to data and holds huge potential.
Do you think the new govt policies will help the players in this segment?
Yes, of course, we are very optimistic with the new govt coming in and we are confident that the telecom industry will see some very pro-business policies.
What are your plans for your product portfolio? Which segment are you focusing on?
Our primary focus would be on the non-voice front including data, M2M and M-commerce, while voice products would continue to be a hygiene factor.
We believe data and MVAS will outpace the traditional revenue streams – a trend enabled by the rapid growth expected in smart/feature phones and Internet penetration. Revenues from data, especially new generation MVAS would be the key growth driver in years to come.
We have also chalked out our plans to enter into the m-commerce universe which would help us in offering specialized services such as mobile banking, portfolio tracker, transaction portals and semi-closed wallet.
Our target segments are primarily youth, HNI, SME and of course first time users. We have recently transformed our brand identity and created a new, versatile, friendly and dynamic brand logo to connect with our target segments. India has the largest population of youth in the world. To engage them with our brand, we have launched a unique youth connect initiative, ‘Young Manch.’ This initiative enables youth to discover and showcase their talents and prepares them to meet future challenges and tap opportunities.