Airtel iCreate 2019

Case Challenge Name: THE ROAD AHEAD

Team Name:
Campus: IIM, Raipur.
Members:V N S
Telecom Industry Dynamics Key Findings
Telcom dynamics are changed by BetaTel drastically
Incremental improvement is seen in some of the competitive
firms like AlphaDel and gamma Tel/deltaTel found their way
through.
Capital Expenditure remains elevated and earnings expansion
remain a challenged for many which led to bankruptancy.

Slide in average revenue per user BetaTel decreasing gradually, but it remains stagnant in this perspective as it wants to
Companies in the case started minimum recharge plans
(Service validity vouchers)to represent the active customers
who pay. This will increase ARPU.

DECREASING THE SUBSCRIBERS TO ONLY ACTIVE SUBSCRIBERS

WHO PAY WITH LESS CUSTOMER CHURN RATE INCREASES ARPU
AND EFFICENT USE OF BROADBAND COVERAGE
Response of AlphaTel vs GammaTel/ DeltaTel
ALPHA TEL
 MERGERS
a. No mergers
 Minimum recharge plans
a. Subscribers responded well, fall of
subscriber base is less(1.8%).
b. Customer Churn Rate was less.
 Better network investments.
 Pros& cons:-
Incremental approach
Better network investments
High broadband coverage with less
revenue.(2.6% Increase 1,77,141 Towers)
GAMMA TEL/ DELTA TEL
a. Mega merger took time to integrate
teams
a. Subscribers relatively did not respond
well, fall of subscriber base post
merger was more(4.3%).
b. Customer Churn Rate was more
 Less network investments
 Pros& cons:-
Defensive approach
Less network investments
Low broadband coverage with high
revenue (1.1% Increase 1,57,278 Towers)
Business Model For Industry/BetaTel

TELECOM COMPANY –
KEY POINTS ON BETATEL BUSSINESS
BUSSINESS MODEL
MODEL:-
INTIAL HIGH INVESTMENT TO GIVE HIGH
DISCOUNTS
BETATEL IS TARGETING HIGHER
SUBSCRIBERS
READY TO LOSE ARPU FOR LARGER
WIRELESS FIXED LINE INTERNET SUBSCRIBER BASE

BROADBAND DIAL UP
REVENUES COSTS
REGULATED
NON-REGULATED
ARPU SUBSCRIBER ENTRY FEE
EMPLOYEE COSTS
ACESS DEFICIT CHARGE
MOU RISING INCOME
SG&A
LICENSE FEE
TARIFFS ECONOMIC GROWTH
AlphaTel approach

IMPROVEMENT OF PRICING: - It remains elusive, since Betatel is not considering ARPU, it is ready
to lose ARPU and totally disrupt the market.
TO IMPROVE PRICING:-
• ALPHATEL SHOULD INTERNALLY MERGE WITH GAMMATEL/DELTATEL FOR BROAD BAND
TOWERS TO DECREASE COSTS AND GIVE CUSTOMERS HIGH QUALITY SERVICE
• REMOVE LOW TARIFF PLANS WHICH ACCOUNTS FOR LESS NO .OF SUBSCRIBERS AND TARGET
HIGH MARKET TO GAIN REVENUE.THIS WILL PROVIDE ALPHATEL WITH HIGHER PRICING POWER
AND HIGHER GROWTH IN QUALITY SUBSCRIBERS
• 5-7% of its 284 million subscribers and contribute 20-25% of its revenue 
• GAMMATEL/DELTATEL needs to expand its LTE coverage quickly and target at least 10 million 4G
customer additions every quarter to sustain a sequential revenue rise with alphatel helping
each other mutually.
• Market segmentation and product positioning should be revamped again