Saturday, November 09, 2013

Cell phones and India

In US I have always lived with AT and T as my cell phone service provider, barring a few months of hiatus in which I switched between Verizon and T-Mobile and again came back to AT and T (or Cingular as it was called then). When my wife came along I switched from single plan to family plan and with the addition of smart phones I added data plan but remained with AT and T itself. Every time I had to get a new handset due to my umpteen reasons I have signed a new 2 year contract and gotten the handset at a discounted price. For my usage, there is no concept of prepaid plans or pay as you go but I pay a fixed monthly cost each month. Another point, I am stuck with a locked phone and there is probably no concept of a dual sim.

Now compare this to the cell phone market in India

  • There is no contract as we went with a prepaid plan and each street in the city has plenty of places that offer mobile currency recharge. 
  • The cost of the sim was INR 100 out of which 81 was reimbursed to our call plan
  • The cost of the calls is INR 1 for 1 minute for outgoing and incoming is free and INR 1 per SMS for sent only and received is free, contrast this with 20 cents per SMS both incoming and outgoing in US
  • The concept of dual sim is a pretty standard affair and I know a lot of people carry dual sim phones and some even use 2 SIMs one from BSNL and one from either Airtel or Vodafone or something similar. I may be wrong but in general BSNL is a fairly standard feature.
  • The killer is the internet plan or mobile data plan as it is called here, for INR 300 one can get 1GB/month plan and for INR 100 one can get 300MB/month contrast this with US where I pay $15 for 200MB/month or $20 for 300MB/month
  • Thanks to the Android OS and lack of discounted phones from providers, one can witness true innovation in terms of handset design and manufacturing. One can get an extremely decent handset (dual core processor, ~1GB RAM, 4-5MP rear camera, high resolution screen, dual sim capable) for INR 10,000 or less.
  • The price range and feature range of smart phone handsets is also huge INR ~7,500 to INR ~70,000 (Galaxy S4’s and Iphone’s)       
  • Another plus is that one can have their choice of manufacturers (SAMSUNG, LG, PANASONIC, SONY, LENOVO, MICROMAX, KARBON, HTC, INTEX, GINOEE, APPLE, NOKIA and so on) contrast this to US where we only see 2 main ones Samsung and Apple with Sony, HTC and LG being the distant 3rd.  
  • As I said before the market is highly segmented and in my observation SAMSUNG is one of the few manufacturers who is playing the whole range and I now understand why the analysts were disappointed with Iphone 5c (not cheap enough)

Before you guys pounce on me, I do agree that my analysis/comparison is not apples to apples as in US we have lot more features in the plan plan like free nights and weekends, cell phone  to cell phone free, lots of wireless hotspots and so on. Also, I haven’t played around with budget carriers like Cricket or Virgin wireless in US. 

2 comments:

Sripathi Kodi said...

2 comments.
Cheapest Android phones cost just 3K, not 7.5K
Post-paid mobile plans are even more fun. Most of them come with built-in free calls and then outgoing calls at 30 paise. Many provide per-second billing too (even half paise per second)! Most SMSes are also 30 paise each! All this for a monthly fixed cost of 100 to 200Rs.

Kalpesh Soni said...

sounds like true capitalism at work

here in usa, phone companies, air lines, real estate market, news its all just controlled by a select few