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At the time when operators are excited about the rural opportunity and are trying to get the maximum share of the market, a panel discussion on “Developing the Right Business Model” becomes very relevant. Romal Shetty, executive director, Advisory Services, KPMG, the moderator of the discussion, asked the panelists to share their experiences in the rural market and present some suggestions for the operators.

GV Krishnan, CMO, Bharti Airtel, started the discussion with praises for the rural market. “Rural India is growing by leaps and bounds. Their GDP is comparable with urban areas,” he said. He further added that Bharti has witnessed some really exciting trends in the rural market, especially in Bihar and Orissa. According to him, rural customers are enjoying services like music-on-demand and dating, which are yet to catch up with the so-called urban market. Krishnan gave the example of migrant people living in urban areas who use the e-recharge facility. “In this manner, there is no extra burden on the rural pocket and they are experimenting like never before with the services,” he added.

Talking on the difficulties and challenges that exist in providing services to rural areas, Krishnan agreed that providing services there (in rural area) is still an uphill task. “Roads do not connect even 40% of rural India. The power problem still exists, and it is difficult for operators to put their sticks and provide services in these areas. Above all, generating a demand for the service is a big challenge that the operators face,” he said.

ATM Hayatuzzaman Khan, chairman, Dhaka Telephone, said that operators alone couldn't provide or contribute to increase the teledensity in the rural market. The regulators and the government also share the responsibility. “Video phone will work wonders for rural areas but will be a costly affair, and no operator would like to explore it, given the regulatory conditions and tariff structures. There should be some sort of subsidy from the government and the regulatory bodies to make it a viable option,” says Khan.

Panel Discussion on 'Developing The Right Business Model' was attended by (from L-R): GV Krishnan, CMO, East Hub, Bharti Airtel; ATM Hayatuzzaman Khan, chairman, Dhaka Telephone; Satya N Gupta, chief regulatory advisor, British Telecom; Romal Shetty, executive director, KPMG; Col RS Perhar, COO, Tulip IT Services; Irfan Wahab Khan, executive vice president, Telenor, Pakistan; Nalin Perera, CMO, Mobitel; and SK Vashishtha, MD, Railtel

Nalin Perera, CMO, Mobitel Sri Lanka, advocated out-of-box thinking and value innovation as a sustainable business model rather than focusing on technology. “Sri Lanka is the first country in South Asia to go cellular. By providing a time-bound tariff structure, we wanted the customer to adopt a pattern according to us. We at Mobitel took the time barrier off and went by focusing on their comfort rather than our revenue,” says Perera. He further added that Mobitel increased its reach in the rural market by making its recharge coupons available at post offices.

Irfan Wahab Khan, executive VP, Corporate and Regulatory Affairs, Telenor, shared his company's experience and said that ARPU is not very different in rural areas. “People in rural areas have got good purchasing power and they have a tendency to spend,” he said. He agreed with the panelists on innovation, but stated, “Innovation doesn't mean providing business solution which is not suitable for the rural market at all. We introduced a voice portal service, 'Tele Kisaan', providing them with information about weather, commodity pricing, and rural products. The service has been well received.” Telenor also developed 'Apna PCO', a mobile PCO in 200 villages of Punjab province (Pakistan) under its corporate social responsibility.

Col RS Perhar, COO, Tulip IT Services, focused on wireless as the right model for spreading into the rural market. He talked about the success of Project Akshay, initiated by Tulip in some parts of rural India. “We decided to provide everything on wireless and that too at a very low cost. We changed the rule of the game and now wireless has caught the fancy,” says Perhar.

At the end of the discussion, Shetty said, “There seems to be a business model, a viable business model. We can truly say here that there are not too many things which we have pioneered, but in telecom, we definitely will pioneer and everybody is going to follow.”

From the discussion, it became obvious that a road map exists for a rural business model. The operators only need to change their methods and try.

Kumar Anshuman