Financial Daily from THE HINDU group of publications
Friday, Jan 11, 2002
Marketing - Strategy
MTNL game to take on rivals
NEW DELHI, Jan. 10
COMPETITION can indeed bring about miracles. Mahanagar Telephone Nigam Ltd (MTNL), the basic telecom service provider in Mumbai and Delhi, is finally shedding its public sector image to take on competition from Bharti Telenet, Reliance Communications Ltd and Tata Teleservices.
While it is already battling Hughes Tele.com in Mumbai, it is the impending competition from Bharti, Reliance and Tata's in Delhi that has spurred it to refurbish its image before it gets too late.
According to official sources, they are keenly waiting the proposed launch of Bharti's basic services (under the Touchtel brand) in Delhi later this month, which promises a much better customer experience. The top brass in MTNL has already put in place a two-pronged strategy to counter the threat.
This involves modernising the existing network to improve the quality of service and a customer management system that seeks to strengthen the loyalty of its subscribers.
``We plan to add tandem switches in both the cities, expand an overlay data network and implement synchronous digital hierarchy technology to improve local access in both markets. We believe that the increased digitalisation will improve the capacity of our network, reduce network failure rates and improve call connection rates," officials said.
They pointed out that in order to strengthen customer loyalty, attract cellular subscribers and improve competitive position, MTNL has introduced a programme to improve customer service and become more responsive to the needs of subscribers.
This strategy has been put in place mainly to retain its corporate customer base which, at present, account for a little over 70 per cent of its total call revenue. The company has identified high usage ``commercially important persons'' and is stepping up efforts to strengthen its relationship with these subscribers.
Touchtel, too understandably is making all efforts to woo this ``big ticket'' segment in the first phase of its launch in Delhi. The company realises that businesses require high quality, 99.9 per cent uptime service levels and basic telecom solutions, which it has promised.
The services it has promised range from leased lines, ISDN, VPN, Centrex services, DSL services, Internet services, IN based services and video conferencing. Meanwhile, its plain vanilla service has been priced at the MTNL's prevailing tariffs.In this effort, it has already committed investments of Rs 300 crore by 2004.
The company has also announced that 400 km of optical fibre infrastructure will be laid around the city in a self-healing ring architecture of which 100 km of the OFC have already been laid, with another 120 km in the process.
It is also setting up one main switching unit, six regional switching units and 25 digital line units to begin with to roll out its basic services.
Its main equipment suppliers are Siemens, Nortel, Cisco and Duraline.
MTNL is, however, putting up a brave front, pointing out that Hughes Tele.com's basic services in Mumbai did not make such a big dent in its revenues.
However, there is also a realisation that Bharti, with its reputation of being ``customer savvy'' service provider could be a different ball game altogether.
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