Tata Teleservices, a telecom services provider owned by the Tata group, is planning to invest an additional $1 billion in its recently-launched GSM service Tata DoCoMo. The company intends to pump this money in a bid to enhance its network in the telecom circles where it has already launched GSM services.
Tata Teleservices had already committed an investment of $2 billion for the GSM services when it was launched in June this year, which was supposed to be spent by the end of the current financial year.
However, the need for the fresh investment came up due to the ‘unprecedented’ growth the company was seeing in terms of customer additions in the telecom circles where the company has already launched the services.
“We have already committed $2 billion for the GSM services. Soon, we are going to commit another billion dollars as we want to further expand in our existing circles,” said Tata DoCoMo President Deepak Gulati to Business Standard. He said the new investment will happen over two years.
“The initial investment was primarily meant for the launch of our GSM services. Now the spending will happen more on capacity expansion and expanding the GSM network further, as we are getting overwhelming response for our services,” he added.
Of the 23 telecom circles in the country, Tata DoCoMo was allotted spectrum to launch its services in 18 telecom circles. As of now, the company has rolled out GSM services in 11 circles, namely Tamil Nadu, Kerala, Orissa, Karnataka, Andhra Pradesh, Madhya Pradesh, Haryana, Chhattisgarh, Kolkata, Mumbai and the rest of Maharashtra.
The company is planning to roll out GSM services in the rest of the circles by December-end.
The first GSM service provider to introduce ‘per second billing’ in India, Tata DoCoMo is now facing increasing competition from the existing players who have started introducing the same scheme in various formats. However, Tata DoCoMo says that per second pulse rate is just one part of its entire offering which is structured to charge the customer according to their usage, whether it is voice call or value-added services.
“Even though it’s too early to comment about revenue from VAS, we are getting positive signs, as the penetration of high-end handsets is high in our customer base. This means, these are the customers who will do a lot of data consumption, they will do a lot of STD and ISD calls,” said Gulati.
According to the company estimate, 40 per cent of its subscribers own GPRS and data-enabled handsets. “Most of them have accepted many of our value added services, as there is no rental for our services and it is granular,” he added.
