Indian mobile operators are aggressively wooing the youth to revive their sagging profits…..

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How Airtel, Vodafone, Idea, Aircel are trying to woo young customers

ByGulveen Aulakh, ET Bureau | Dec 27, 2012, 12.01 PM

Indian mobile operators are aggressively wooing the youth with low-cost data tariff plans and freebies as they bet on increased data use by youngsters to revive their sagging profits.

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NEW DELHI: Indian mobile operators are aggressively wooing the youth with low-cost data tariff plans and freebies as they bet on increased data use by youngsters to revive their sagging profits.

Aircel, owned by Malaysian telecom firm Maxis, for instance, now offers free talk time for each purchase made at online shopping portal Yebhi.com, while Reliance Communications has tied up with Facebook and Whatsapp for monthly plans at rock-bottom prices.

The top three players, Bharti Airtel, Vodafone India and Idea Cellular, have tied up with RIM to offer BlackBerry instant messaging service at 129 a month to college students, a massive discount over the handset maker’s actual tariff plan.

“Young people spend more time on mobile phones consuming data than consuming voice,” Bharat Bambawale, global brand director at Bharti Airtel said. “They hardly ever speak to anyone on a paid call and would use Whatsapp or BlackBerry Messenger to keep in touch with their friends,” he told ET.

After the initial boom years, Indian mobile service providers have been facing severe margin pressure.

Over the last year, they have cut dealer commissions, distribution costs and purged inactive customers to drive profitability in business.

Now, these firms have realized that they will have to rely on data services-oriented models to bring in revenues as the Indian youth takes to internet-on-mobile and social media at a lightning pace.

Reliance Communications this week announced a partnership with social media giant Face book to offer unlimited messenger service at 16 a month for its GSM subscribers.

The Anil Ambani-owned telco has also tied up with instant messaging provider Whatsapp for a similar plan at the same tariff.

Aircel subscribers recharging their connections will get cash back for shopping at Yebhi.com, while non-Aircel customers shopping at the portal will get a free Aircel connection along with talk time.

Falling prices of smartphones contribute heavily to this trend.

Mary Meeker, partner and analyst at Kleiner Perkins Caulfield and Byers, said India reported the sharpest surge in the number of smartphone users at 44 million people using smartphone in the fourth quarter of 2012, 52% more than a year earlier.

The country is now ranked fifth in the number of smartphone users.

 

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