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Global Grip

Reliance Infocomm's IndiaMobile CDMA service began poorly, but has startled all GSM players since - with its success.

By Vandana Gombar

Quick. Which company is tele-connecting Indians faster than anyone else? The answer is Reliance Infocomm with its IndiaMobile brand of CDMA mobile phone services. At last count, it had over 5 million subscribers --- with an estimated 750,000 signing on every month. It's a no contest. This has got to be the launch of the year.

Barely a year ago, it was just a grandiose business plan dreamt up by India's greatest entrepreneurs of recent times, the late Dhirubhai Ambani. A plan that seemed unrealistic in betting on an explosion in telecom demand if the price of a quick call home, as Dhirubhai put it, could be reduced to the 15-paise of a postcard.

The business never came round to postcard-beating prices, and nor was the launch smooth. Its network marketing initiative was a disaster, the sign-on charges were shockingly high, the service offer was a tangle of confusion and the ad campaign was a jumble of messages. In short, the name known best for its clockwork execution-to-plan skills, Reliance, was in serious danger of scoring its first large scale failure. That too, with the stakes so high - both in terms of investment and public exposure.

What followed was a turnaround that will surely go down in business history as among the world's most dramatic course corrections (Microsoft's embrace of the Internet offers a parallel, though this was a lot faster if less internally complex). Within weeks, Reliance had ripped up the old market addressal processes and replaced them with customer engagement systems that drew in the crowds. The attitude: do what it takes. Schemes were redrafted. Prices were redone. And the adspeak altered. Suddenly, 'kar lo duniya muthhi mein' (grasp the world) had begun to match expectations --- and CDMA started posing a genuine alternative to GSM cellular services.

Legal wrangles, there were - particularly to do with the range that a 'limited mobility' service such as Reliance's was permitted to cover. But at the end, the very crowds signing up at the Reliance counters became an indication of which way India's telecom policy would move (or 'evolve' as some would call it): towards a Unified Telecom Licence regime that treats CDMA technology, a gatecrasher of sorts, as just another mobile service provider.

Today, Reliance is bustling with customers. Since May 1, this firm has managed to capture the 25-per cent share of the wireless market that it had targeted. According to data compiled by the Association of Basic Telecom Operators (ABTO), Reliance has over half a million subscribers in states like Tamil Nadu and Delhi (0.59 million each) and a whopping 0.84 million in Maharashtra.

The subscriber base is expected to spike sharply in 2004 on two counts. First, at the cost of Rs 1,500 crore, the company has got the right to become a 'fully mobile player'. This allows the brand to end all doubts in the consumer's mind related to its erstwhile 'limited' status (inter-city roaming and so on). "There are a large number of subscribers who have not tried our service... who shied away from our service," says Reliance Infocomm president Prakash Bajpai. Going after them could send the monthly subscriber add-on numbers to some 2 million.

The second reason is the company's impending launch of a prepaid version of its service. Two of every three handsets in the country are loaded with a pre-paid service (most GSM cellular connections are prepaid). Reliance Infocomm is yet to offer this convenience.

So far, Reliance has invested a leviathan-sized sum of Rs 16,000 crore in the project. Once again, it has proven its ability to do exactly what it takes. That's quite a grip.

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