BSNL finds a competitor in its own backyard

BANGALORE AUG. 10. Even as a mobile revolution of sorts is sweeping across the country, the Bharat Sanchar Nigam Ltd. (BSNL), one of the largest telecom operators, is facing stiff competition for its basic services from its own cellular division.

The CellOne and the other popular mobile services are slowly cutting into BSNL's landline service. This is evident from the number of landline connections that have been surrendered in lieu of mobile services in Bangalore. However, the situation is different in rural areas.

The Principal General Manager for Bangalore Telecom District, B.R.Baliga, told The Hindu that the number of subscribers surrendering landline connections was increasing every month.

As many as 3,775 landline subscribers in April, 5,508 in May, and 7,026 subscribers in June had surrendered their connections in Bangalore Telecom District, he said.

The demand for mobile services has increased in the State. The number of cellular subscribers increased from 6,96,650 in January to 9,93,868 in June 2003. The presence of a number of private players and competition among major service providers is one of the reasons for the increase in the number of subscribers, Mr. Baliga said.

By June-end, the highest number of customers — 4,52,174 — subscribed to Airtel cellular servicesfollowed by BSNL with 2,63,588, Spice with 1,95,293, and Hutch with 82,813. The demand for Airtel, Spice, Hutch, and BSNL cellular services is more due to the adoption of GSM technology which has a greater geographical reach. The increase in the demand for cellular services forced the BSNL to stop issuing pre-paid cards for its services in Bangalore. It had decided to issue 33,000 pre-paid cards in the city by the end of September, Mr. Baliga said.

The BSNL has decided to provide short messaging service (SMS) facility to landline subscribers to discourage the surrendering of connections. The BSNL's Bangalore Telecom District is likely to start SMS field trials from August 11. Interestingly, the number of cellular subscribers has overtaken the number of landline subscribers in cities such as New Delhi and Chandigarh. Mr. Baliga said a number of people, including students, were subscribing to mobile services due to its several advantages over landline connections. Subscribers were making vast use of mobile phones for purposes other than making a call, he said.

The usage content provided by some cellular operators ranged from the latest news to stock prices to city guide and TV guide. Easy accessibility, free incoming calls, and free voice mail were some of the advantages, he observed.

A cross-section of the people using mobile services are said to be unhappy with landline services. Line jam, misuse, and high service cost are cited as their major grievances. Ashish Dash, who is conducting a doctoral research in `Pricing of telephone connection services', says, "Mobile service is going to be the major voice service career in the future."

But still, the demand for landline connections had not decreased, particularly in rural areas. In the city, many people demand landline connections for Internet and other purposes, Mr. Baliga said. The demand for landline connections is more in rural areas because of more number of free calls and lower rental, Mr. Dash said.

Recently, the Union Minister for Communications told Parliament that the total number of people in the waiting list for telephone connections in the State up to June-end was 1.09 lakh. The highest was in Dakshina Kannada with 17,600, followed by Belgaum, Mandya, Shimoga, and Bangalore Rural.