A Comparative Analysis of Customer Service Provided by Cellular Mobile Service Providers (CMSP) in Mumbai Region
Thesis Submitted to Padmashree Dr. D. Y. Patil University, Department of Business Management In partial fulfillment of the requirements for the award of the Degree of
DOCTOR OF PHILOSOPHY In BUSINESS MANAGEMENT Submitted by BHARAT BHUSHAN CHAUDHARY (Enrollment Number: DYP-PhD -066100005)
Research Guide Prof. Dr. Vijay Wagh Padmashree Dr. D. Y. Patil University, Department of Business Management CBD Belapur, Navi Mumbai - 400614 January 2012
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A Comparative Analysis of Customer Service Provided by Cellular Mobile Service Providers (CMSP) in Mumbai Region
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Declaration by the Candidate
I declare that the thesis entitled “A Comparative Analysis of Customer Services Provided by Cellular Mobile Service Providers (CMSP) in Mumbai Region” submitted for the award of Doctor of Philosophy in Business Management at the Padmashree Dr. D.Y. Patil University, Department of Business Management is my original work and the thesis has not formed the basis for the award of any degree, associateship, fellowship or any other similar titles.
Place: Navi Mumbai.
Date: 20.1.2012
Signature Signature Signature Research Guide Head of Department of Student
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Certificate
This is to certify that the thesis entitled “A Comparative Analysis of Customer Services Provided by Cellular Mobile Service Providers (CMSP) in Mumbai Region” submitted by Shri BHARAT BHUSHAN CHAUDHARY a bonafide research work for the award of the Doctor of Philosophy in Business Management at the Padmashree Dr. D. Y. Patil University, Department of Business Management in partial fulfillment of the requirements for the award of the Degree of Doctor of Philosophy in Business Management and that the thesis has not formed the basis for the award of any degree, diploma, associate ship, fellowship or any other similar title of any University or Institution.
It is also certified that the thesis represents an independent work on the part of the candidate .
Place: Navi Mumbai
Date: 20.1.2012
Signature of Head of department Signature of Guide
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Acknowledgements
I am indebted to Padmashree Dr. D.Y. Patil University Department of Business
Management, which has accepted me for Doctorate program and provided me with an excellent opportunity to carry out the present research work.
I offer my sincere gratitude to my research guide, Professor Dr. Vijay Wagh, who supported me throughout my research with his patience and knowledge while allowing me the freedom to work in my own way. I attribute the quality of my research work to his encouragement and effort and without him this research work would not have been completed.
My sincere thanks to Professor Dr. R Gopal, Director, Dean and HoD,
Department of Business Management who relentlessly encouraged me in completing this research work in time. I am also thankful to Professor Dr.
Pradeep Manjrekar, Head of the Research Extension for his constant support in this research work.
Finally, I thank my parents and siblings for supporting me throughout all my studies. Last but not the least a big thank you to Ms. Sarita; my wife without her support I would be a very different person today, and it would be certainly impossible to complete a PhD. Special thanks to my son Anurag and daughter
Akansha for their tolerance and cooperation.
Place: Mumbai
Date: 20.1.2012 Signature of the student
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Contents
Chapter Sub Chapter Name Page
No. title No.
No.
Declaration iii
Certificate iv
Acknowledgements v
Contents vi
List of Abbreviations 1
List of Tables 4
List of Figures 11
Executive Summary 12-25
Chapter-I
1 Introduction to Cellular Mobile Service 26-59
1.1 Introduction 27
1.2 Evolution of Telecom Services in India 28
1.3 Segments of Telecom Service 33
1.4 Telecom Service Areas 35
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1.5 Cellular Mobile Services 38
1.6 Postpaid and Prepaid Services 43
1.7 Growth in Cellular Mobile Service 43
1.8 Market Share of GSM and CDMA 45
1.9 Structure of the Telecom Sector in India 45
1.10 Radio Frequency Spectrum. 51
1.11 Generations of Mobile Service 52
1.12 Indian Telecom Laws. 53
1.13 SWOT Analysis of the Telecom Industry 58
Chapter-II
2 The Process of Providing CMTS 60-87
2.1 CMTS License 61
2.2 Allotment of Spectrum 61
2.3 Service Roll out Plan 63
2.4 Service Marketing Mix for CMS 68
2.5 Challenges in Segmentation 69
2.6 Market Strategy 72
2.7 Market Research 73
2.8 Buissness Models Employed by CMSPs 74
2.9 Life cycle of CMS 77
2.10 Commercial Launch of CMS 83
2.11 Appointment of Sales Channel 83
2.12 Monitoring QoS and Security Issues 87
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Chapter-III
Literature Review Part-I
3 Study of TRAI Service Quality Standards 88-109
3.1 Literature review on Service Quality 89
3.2 Regulations on QoS for CMS 92
3.3 Fault Incidence and Repair 96
3.4 Network Performance 97
3.5 Billing Complaints 97
3.6 Customer Perception of CMS 98
3.7 Review of QoS Benchmark by TRAI 99
3.8 Customer Perceptions of CMS after review 104
3.9 Response Time for assistance after review 104
3.10 Customer Helplines 105
3.11 Evolution of Quality of Experience 105
Chapter-IV
Literature Review Part-II
4 Study of Customers Expectations 110-141
4.1 Literature Review on Customer Service 111
4.2 Growth of the Service Sector in India 112
4.3 Service Triangle of Marketing 114
4.4 Evolution of Service Quality 116
4.5 SERVQUAL Scale 120
4.6 Service Quality Studies in Telecom 136
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4.7 Customers’ Expectations from CMSP 138
4.8 Customers’ Perception of CMS 140
Chapter-V
5 Cellular Mobile Service in Mumbai Region 142-162
5.1 Introduction 143
5.2 History of Mumbai 143
5.3 Geographical Location of Mumbai 144
5.4 Qualitative Analysis of Customer Service 147
5.4.1 M/s Vodafone Ltd 147
5.4.2 M/s Bharti Airtel Ltd 151
5.4.3 M/s Tata Teleservices Limited (TTSL) 154
5.4.4 M/s Reliance Communications Limited 156
5.4.5 M/s Loop Mobile Ltd 158
5.4.6 Mahanagar Telecom Nagar Ltd 159
5.6 Problems faced by CMSPs 162
Chapter-VI
6 The Research Methodology 163-172
6.1 Introduction 164
6.2 Problem Statements 164
6.3 Objectives Of Study 165
6.4 Deficiencies in TRAI Standards 166
6.5 Benefits of the Study 166
6.6 Importance of the Study 167
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6.7 Research Hypothesis 168
6.8 Data Collection 168
6.9 Sample Plan 169
6.10 Research Tools and Techniques 171
6.11 Scope of the Study 172
Chapter-VII
7 Measurement of Service Quality and 173-198
Customer Expectations
7.1 Introduction 174
7.2 Selection of Measurement Scale 175
7.3 Validation of the Modified Scale 178
7.4 Measurement of customers Perceptions and 189
Expectations
7.5 Comparative Analysis of the Customer 195
Service in Mumbai
Chapter-VIII
8 Review of Price Management 199-217
8.1 Introduction 200
8.2 Pricing Approach of CMSP 201
8.3 Price Regulations 202
8.4 Price and Demand Elasticity 203
8.5 Cost of Provisioning CMS. 204
8.6 Pricing of CMS 205
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8.7 Role of TRAI in Pricing 209
8.8 Disruptive Pricing 213
8.9 Comparative Analysis of Price 215
Management for CMSPs
9 Chapter-IX
Review of Product Management 217-230
9.1 Introduction 218
9.2 Concept of Product in the CMS 220
9.3 Challenges in developing New Products 222
9.4 Quality Function Deployment in Product 223
development
9.5 Product Management 225
9.6 Product Mix in CMS 226
9.7 Comparative Analysis of Product 227
Management for CMSPs
Chapter-X
10 Review of the Physical Evidence 229-241
10.1 Introduction 230
10.2 Servicescape Effects on Customer Behavior 234
10.3 Environmental Dimensions of the Servicescape 237
10.4 Understanding the Servicescape Effects 238
10.5 Customers Feedback on the Servicescape 239
10.6 Comparative Analysis of Physical Evidence 240
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for CMSPs
Chapter-XI
11 Review of Promotion Management 242-256
11.1 Introduction 243
11.2 The Communication Process 244
11.3 Promotional Methods used by CMSPs 245
11.4 Promotion Targets 247
11.5 Objectives of Marketing Promotions 248
11.6 Promotion mix for CMS 249
11.7 Comparitive Analysis of the Promotion for 256
CMSPs
12 Findings 258-274
12.1 Introduction 259
12.2 Process of providing CMTS 259
12.3 Study of the Service Quality Standards 261
12.4 Customers Expectations 263
12.5 Performance of the Customer Service and 267
Expectations
12.6 Gaps in the Quality of Customer Service 269
12.7 Comparative Analysis of the 271
Customer Service
12.8 Suggestions to bridge the gap 274
Chapter-XIII
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13 Conclusions and Recommendations 275
13.1 Conclusions 276
13.2 Recommendations 277
13.3 Limitations 278
13.4 Future scope for Research 279
Bibilography 280
Questionnaire
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Glossary of the terms used
SNo Abbreviation Full Form
1. 1G First Generation
2. 2G Second Generation
3. 3G Third Generations
4. ADB Asian Development Bank
5. ADC Access Deficit Charge
6. AHP Analytical Hierarchy Programming
7. ARPM Average Revenue Per Minute
8. ARPU Average Revenue Per User
9. ASSOCHAM The Associated Chambers of Commerce of Industry
of India
10. AUC Authentication Centre
11. AGR Adjusted Gross Revenue
12. BOP Balance of Payment
13. BPL British Physical Laboratory
14. BSC Base Switching Centre
15. BSNL Bharat Sanchar Nigam Limited
16. BSO Basic Service Operators
17. BTS Base Transmission Station
18. CRM Customer Resource Module
19. CAF Customer Agreement Forms
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SNo Abbreviation Full Form
20. CMS Cellular Mobile Service
21. CMSP Cellular Mobile Service Provider
22. CMTS Cellular Mobile Telecom Service
23. COPRA Consumer Protection Act
24. CRBT Color Ring Back Tone
25. DoT Department Of Telecom
26. DTS Department of telecom service
27. EIR Equipment Identification Register
28. ETSI European Standard and Technology Institute
29. FDI Foreign Direct Investment
30. FICCI Federation of Indian Chambers of Commerce and Industry 31. GDP Gross Domestic Product
32. GIWU GSM Interworking Group
33. GMSC Gateway Main Switching Centre
34. GSM Global System for Mobile
35. HLR Home Location Register
36. IDA International Development Authority
37. IMF International Monetary Fund
38. IMSI International Mobile Identity
39. IMTS Improved Mobile Telecommunication Service
40. ITU International Telecom Union
41. IUC Interconnect Usage Charge
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Sno Abbreviation Full Form
42. MOU Minutes Of Usage
43. MSC Main Switching Centre
44. MTNL Mahanagar Telecom Nigam Limited
45. MXE Message Centre
46. NATO North Atlantic Treaty Organization
47. NFAP National Frequency Allocation Plan
48. NTG National Technology Group
49. NTP 1994 National Telecom Policy
50. NTP 1999 New Telecom Policy
51. OMC Operation and Maintenance Centre
52. OSS Operation Support Sub System
53. P&T Post and Telegraph Department
54. POTS Plain Ordinary Telecom Service
55. PWD Public Works Department
56. QoS Quality of Service
57. RCV Recharge Coupon Vouchers
58. TRAI Telecom Regulatory Authority of India
59. SACFA Standing Advisory Committee on Frequency Allocation 60. SWOT Strength Weakness Opportunity and Threat
61. TDSAT Telecom Dispute Settlement & Appellate Tribunal
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List of Tables
SNo Table Title Page
No. No.
1. A-1 Perceptions, Expectations and Gap for all eight 21
dimensions of Service Quality.
2. A-2 Ranking of CMSPs on the quality of customer 24
service.
3. 1.1 Number of wire line, wire less, total connections 34
and teledensity (in %) from 2004 to 2011.
4. 1.2 Details of the Metro, A, B and C Circles. 35
5. 1.3 Number of Mobile connection, CMSP, Population 36
and teledensity (in %) in the Metro circles as on
March 2011
6. 1.4 Number of Mobile connections, CMSP, 36
Population and teledensity (in percentage) in A
circles as on March 2011.
7. 1.5 Number of Mobile connections, CMSP, 37
Population, teledensity (in %) in B circles as on
March 2011.
8. 1.6 Number of Mobile connections, CMSP, 37
Population and teledensity in C circles as on
March 2011.
9. 1.7 Market Share of GSM and CDMA Technology for 39
Financial Year 2005 to 2011.
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SNo Table Title Page
No. No.
10. 1.8 Comparison of the CDMA and GSM revenue 42
Average revenue per user (ARPU) in Indian
rupees and Minutes of usage (MoU).
11. 1.9 The Postpaid and Prepaid component for GSM 43
and CDMA in percentage.
12. 1.10 The teledensity of urban and rural populations in 44
India as on January 2011.
13. 1.11 The Regional and the Pan India CMSP. 47
14. 1.12 The details of the USO funds collected and 56
disbursed from 2003 to 2010.
15. 2.1 Comparison between Minutes Factory and 76
Subscriber Model.
16. 2.2 The four stages of the telecom product cycle. 77
17. 2.3 The Main and the supplementary products for 79
CMS
18. 3.1 Fault incidence and repair bench marks for 96
Cellular Mobile Service (CMS).
17. 2.3 The Main and the supplementary products for 78
CMS
19. 3.2 The Network Performance bench marks for 97
Cellular Mobile Service.
20. 3.3 The Billing benchmark for CMS. 98
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SNo Table Title Page
No. No.
21. 3.4 The customer perception of services for CMS. 98
22. 3.1 (a) Fault incidence and repair benchmarks for CMS. 100
23. 3.2 (a) The Network Performance bench marks for CMS. 103
24. 3.5 The billing complaint benchmark for CMS. 103
25. 3.4(a) Fault incidence and repair parameters for CMS 104
26 3.6 Response of Call centre operators on help line 105
27 5.1 The location of Mumbai Region 144
28. 5.2 The number of Vodafone limited outlets in 149
Mumbai.
29. 5.3 The number of Vodafone limited mini stores in 150
Mumbai
30. 5.4 The number of the Vodafone limited stores in 150
Mumbai.
31. 5.5 The number of the Airtel stores in Mumbai 152
32. 5.6 The number of the Customer service centre 161
located in the MTNL Mumbai region.
33. 5.7 The number of the MTNL distributors and 162
retailers in Mumbai.
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SNo Table Title Page No
No.
34. 6.1 The market share of the CMSP as on May 2007. 169
35. 6.2 Sample size of the CMSP used in the Study 170
36. 6.3 The Distribution of Sample in ten zones of MTNL. 171
37. 7.1 The five items of Reliability 175
38. 7.2 The five items of Responsiveness (Q). 176
39. 7.3 The four items of Assurance (R,). 176
40. 7.4 The four items of Empathy(S). 176
41. 7.5 The three items of Tangibles (T). 176
42. 7.6 The four items of Network Quality (NQ1). 177
43. 7.7 The two items of Value added services (VAS1). 177
44. 7.8 The two items of Innovation (INNOV). 177
45. 7.9 The details of the Questionnaire 179
46. 7.10 The Factor loadings and Alpha for the proposed 181
scale for Reliability.
47. 7.11 The Factor loadings and Alpha for the proposed 181
scale for Responsiveness.
48. 7.12 The Factor loadings and Alpha for the proposed 182
model for Assurance
49. 7.13 The Factor loadings and Alpha for the proposed 182
scale for Empathy.
50. 7.14 The Factor loadings and Alpha for the proposed 182
scale for Tangibles.
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SNo Table Title Page
No. No.
51. 7.15 The Factor loadings and Alpha for the proposed 182
scale for VAS.
52. 7.16 The Factor loadings and Alpha for the proposed 183
scale for network
53. 7.17 The Factor loadings and Alpha for the proposed 183
scale for innovation.
54. 7.18 The Measurement of the Sampling adequacy 183
55. 7.19 The unidimensionality and convergent validity 185
indices for the eight dimensions
56. 7.20 The Correlations among the Seven Dimensions 186
and External Criteria
57. 7.21 The Regression analysis results for relative 187
importance of Service Quality Dimensions
58. 7.22 The Expectations, perception and Gap score for 188
Reliability dimension of service quality.
59. 7.23 The Expectations, perception and Gap score for 188
Responsiveness dimension of service quality
60. 7.24 The Expectations, perception and Gap score for 188
Assurance dimension of service quality.
61. 7.25 The Expectations, perception and Gap score for 188
Empathy dimension of service quality.
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SNo Table Title Page
No. No.
62. 7.26 The Expectations, perception and Gap score for 189
Tangibles dimension of service quality.
63. 7.27 The Expectations, perception and Gap score for 189
Network quality dimension of service quality.
64. 7.28 The Expectations, perception and Gap score for 189
value added service dimension of SQ.
65. 7.29 The Expectations, perception and Gap score for 189
Innovation dimension of service quality.
66. 7.30 The Descriptive static’s for the eight dimensions 191
of service quality
67. 7.31 Comparison Matrix for Important factors 195
68. 7.32 Eigen vectors after normalization. 195
69. 7.33 Importance of factors in percentage. 195
70. 7.34 Option performance matrix for CMSPs 197
71. 7.35 The relative value vector for four factors 197
72. 8.1 Customers response on price 216
73. 8.2 Normalized results with percentage weight 216
74 9.1 Customers response on Network quality 228
75 9.2 Normalized results with percentage weight 228
76 10.1 The elements of physical evidence 231
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No Table Title Page
No. No.
77 10.2 Customers response on physical evidence 240
78 10.3 Normalized results with percentage weight 241
79 11.1 Customers response on promotion management 257
80 11.2 Normalized results with percentage weight 257
81 12.1 Expectations on reliability dimension 264
82 12.2 Expectations on responsiveness dimension 264
83 12.3 Expectations on assurance dimension 264
84 12.4 Expectations on empathy dimension 265
85 12.5 Expectations on tangibles 265
86 12.6 Expectations on network. 265
87 12.7 Expectations on value added services 266
88 12.8 Expectations on innovation 266
89 12.9 Expectations, Perceptions and Gap 267
90 12.10 Descriptive statistics for eight dimensions 269
91 12.11 The option performance vector 270
92 12.12 The relative value vector for four factors 273
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List of figures SNo. Figure Title Page No. Number 1. 1.2 Swot analysis of Telecom Industry in India 59
2. 2.1 Block of Cellular Mobile services 65
3. 2.2 Segmentation of the mobile customers in India 71
4. 2.3 Two side’s platform business model 75
5. 2.4 The relation between the asking price 81
and percentage of buyers
6. 2.5 The response of the product on the time scale 82
7. 4.1 Gap Model, Servqual Parasuraman 127
8. 9.1 Product Mix in Cellular Mobile services 227
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Executive Summary
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Executive Summary
A Comparative Analysis of Customer Service Provided by Cellular Mobile
Service Providers (CMSP) is a research study which compares the quality of the customer service provided by Vodafone limited, Bharti Airtel limited,
Reliance Infocom limited, Tata Teleservices limited, Loop Mobile and
Mahanagar Telephone Nigam Limited in Mumbai region.
It begins with introduction to Cellular Mobile Service (CMS), the process of providing Cellular Mobile Telecom Service (CMTS) and service quality standards formulated by Telecom Regulatory Authority of India (TRAI). A new scale was developed by modifying the existing SERVQUAL scale by adding three new dimensions Network quality, Innovation and Value added services to the existing five dimensions Reliability, Responsiveness, Assurance,
Empathy and Tangibility. The three new dimensions were validated using statistical models. The customer’s expectations towards the cellular mobile services were also studied in detail. The gap between the customer’s perceptions and expectations was calculated to find out whether they are satisfied. At the end of the study a comparative analysis is done to achieve the main objective of the research using Analytical Hierarchy Programming
(AHP) model to rank the CMSP on Network quality, Price, Promotion and
Physical Evidence.
Literature Review
The wireless service is also known as cellular mobile service, because the coverage areas are split into small geographical areas called cells. It not only
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provides voice and data communication but also plays an important role in supporting business processes. It has eliminated the need of many physical products. It has reduced energy consumption by reducing the need to travel to a great extent. It enables configuration of value chains for quick delivery of products. The availability of cellular mobile service with an assured quality of customer service has become essential.
The Telecom regulatory authority of India (TRAI) service standards does not include the entire customer’s perception. The CMSPs are engaged in enrolling new customers; they are not paying much attention on service quality. In order to remain reachable the customers have opted for the mobile service of more than one CMSP.
In view of this, the customers’ perceptions and expectations were measured.
Then the gap between perceptions and expectations is calculated to find out whether the customers are satisfied. A comparative analysis is done to rank the CMSP on the quality of the customer service. This analysis will assist the customers to select cellular mobile services as per their specifications and help CMSP to recover their deficiencies in service quality.
Objectives of the Study
The main objective of this research is to do a Comparative Analysis of
Customer Service provided by the Cellular Mobile Service Providers (CMSP) in Mumbai region. The summary of the objectives is as follows:
i) To study the process of providing Cellular Mobile Telephone Service
(CMTS).
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ii) To study service quality standards set up by telecom regulatory
authority of India (TRAI).
iii) To study the Customer’s expectation about service quality.
iv) To measure the performance of service quality against the Telecom
regulatory authority of India (TRAI) standards and customer’s
expectation.
v) To find out the gaps in performance and to give suggestions to bridge
the gaps if any.
Benefits of the Study
This study is of multidimensional nature and will be beneficial to all Cellular
Mobile Service Providers, regulators, policy makers, customers, distributors, marketing agents and all those who are in the telecom trade.
The Research Hypothesis
The following hypothesis is used in this study:
H01: The CMSPs in Mumbai are meeting TRAI parameters.
H 11: The CMSPs in Mumbai are not meeting TRAI parameters.
H02: The CMSPs in Mumbai are meeting the customer expectations.
H12: The CMSPs in Mumbai are not meeting the customer expectations.
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Sample Plan
In this study two samples were used. The first sample consists of CMSP in
Mumbai region providing service for more than three years (in 2007), having a market share of greater than 5% and more than 0.5 million customers. Only six service providers Vodafone limited, Bharti Airtel, Reliance Infocom, Loop
Mobile, Tata Teleservices and Mahanagar Telephone Nigam limited qualify as per these criteria. The second sample consisted of 1360 customers distributed in Mumbai region proportional to the market share of the CMSPs.
Measurement of Service Quality
The modified SERVQUAL scale was validated by the collected data with the help of the Cronbach’s alpha test to measure consistency among the scale items. The factor analysis was done in the next step to reduce a large number of variables into less number of factors. The items in the respective category were individually subjected to Principal Component Analysis (PCA) with
Varimax rotation. Finally, eight factors comprising twenty-eight items were extracted. The Confirmatory factor analysis (CFA) was done in order to confirm unidimensionality of the scale and validity tests were performed. The correlation between three new dimensions network quality, value added services and innovations with overall service quality was done. The eight service quality dimensions, were subjected to regression analysis to rate their relative importance. The results were used to suggest the priority areas which need improvement.
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Findings
The findings on objectives of this research study and hypothesis are discussed below in five parts:
i) The Process of Providing Cellular Mobile Telephone Service
The telecom ecosystem is still evolving in India. It is cumbersome to
obtain CMTS license. The spectrum allotment also takes time in the
absence of a time bound schedule.
A lot of effort is required for building interconnect network for local,
national and international destinations.
The cost of providing cellular mobile services in Mumbai is high while
the call rates are lowest in the world due to the presence of eighteen
CMSPs in Mumbai.
The CMSPs are launching mobile service without proper testing and
validation; in this period welcome plans are offered to new customers
without proper call centre to attend customer complaints.
The roll out obligations are not met as per the CMTS license
conditions, still there are a number of dark spots in Mumbai.
The spectrum is the core resource in providing the mobile services, the
lesser the spectrum more Base Transmission Stations are needed, and
the cost of the infrastructure increases for achieving the same service
quality. Both GSM and CDMA providers are facing congestion due to
scarcity of spectrum.
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The spectrum allotment policy is technology dependent. The CMSP are
allotted spectrum in different blocks the maintenance cost is different
for different blocks.
ii) The study of service quality standards set up by TRAI
{H01: The CMSPs in Mumbai are meeting TRAI parameters}
The customers are not aware about TRAI; all the customers’
perceptions about the mobile service are not included. The present
model focuses on four parameters fault incidence and repair, network
performance, billing complaints and customer perceptions of mobile
service.
The benchmark for the perception of the customer services fixed by
TRAI in percentage terms seems to be general. A number of factors
such as price, reliability, availability, usability and utility are not
included.
The TRAI service quality parameters were finalized after a lot of
research and consultations from stake holders. On analysis of quarterly
surveys done by TRAI from April 2003 to June 2005, CMSPs have
failed to meet service quality parameters.
These service quality parameters were modified in July 2005, on
analysis of the quarterly surveys done after modifications the CMSPs
again failed to meet the service quality parameters.
A paradigm shift in service quality is noticed in the mobile service.
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The notion of Quality of Experience (QoE, abbreviated also as QoX)
has appeared, describing quality as perceived by the human user
instead of as captured by (purely technical) network parameters.
With the growth of mobile service, it has become very important for
CMSPs to measure the quality of experience (QoE) of its network
accurately and improve it to achieve and maintain competitive edge.
The service quality parameters are silent on the performance of the
mobile handsets.
As per the above findings it is concluded that the CMSPs in Mumbai region
are not meeting the TRAI parameter and hence the above null hypothesis
(H01) is rejected.
iii) Customers’ expectations on quality of customer service
{H02: The CMSPs in Mumbai are meeting the customer expectations}
The customer’s expectation is simple they wish to remain reachable where
ever they go. The individual and the corporate customers have different
expectations and the expectations vary for different service attributes.
The mobile customers’ expectation is influenced purely by their needs.
The higher numbers indicate higher level of expectations or perceptions. It was
found that the expectations for the service quality dimension reliability (6.04)
and innovations (6.20) are more than six points. The value of expectations for
the remaining six dimensions was found between five and six, assurance
(5.99), network quality (5.77), tangibles (5.47) and empathy (5.18).
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A higher perception also indicates higher satisfaction as service quality and
satisfaction are positively correlated. This means that the dimensions with
the higher perception scores depict higher satisfaction on the part of
customers and lower perception scores depict lower satisfaction.
It can be concluded that the customers in Mumbai are looking for a mobile
service which is highly reliable and innovative value added services.
As per the above findings it is concluded that the CMSP in Mumbai region are
not meeting the TRAI parameter and hence the above null hypothesis (H02) is
rejected.
iv) The Performance of the Customer Service Quality against the TRAI
parameters and Customers’ Expectations
In order to find the performance of the customer service quality against
the TRAI and customers’ expectations the gap between the
perceptions and the expectations was calculated for all eight
dimensions of the service quality.
The overall gap between the perceptions and the expectations was
found negative. This resulted in the negative gap score (Perception-
Expectation). The negative gap is common as the customers’
expectations are always more than the perceptions and they keep on
increasing.
The overall average gap score for all the eight dimensions = - 0.793.
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The gap score gives an idea about the quality of service provided by
CMSPs. It is seen form the results above that the gap is negative and it
proves that the CMSPs in Mumbai are not meeting the TRAI
parameters and customers expectations.
The gap between perceptions and expectations is negative it indicates
that customers expect more than what is offered by the CMSPs in
Mumbai region. The mobile customers perceive service quality lower
than their expectations and hence they are not satisfied.
The overall service quality is measured by obtaining an average gap
score of the SERVQUAL dimensions. In order to evaluate overall
service quality as perceived by the mobile customers, three additional
dimensions were added to the five existing items.
Table: A1- Expectations, perception and Gap for eight dimension of SQ.
SNo Dimension Expectation Perception Gap 1 Reliability 6.04 4.92 -1.12 2 Responsiveness 5.8 4.87 -0.93 3 Assurance 5.99 5.13 -0.86 4 Empathy 5.18 4.51 -0.66 5 Tangibles 5.47 5.10 -0.36 6 Network quality 5.77 5.16 -0.61 7 Value added services 5.44 4.67 -0.77 8 Innovation 6.20 5.16 -1.04 Source: research survey findings
All the dimensions show a gap this means that CMSPs need to make
an all around improvements to close the gaps.
The customers perceive service quality offered by the CMSP as poor in
all dimensions and falling short of their expectations.
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v) Gaps in customer service quality and suggestions to bridge the gap
The gap was measured by calculating difference between the expectations and perceptions.
Reliability (P)
The value of mean for the reliability criteria is -1.091 and the median is -1.00.
The reliability is rated high by the customers.
Responsiveness (Q)
The value of mean for the responsiveness criteria is -1.0 and the median is -
0.75. The responsiveness is also rated medium by customers.
Assurance (R)
The value of mean for the assurance criteria is -0.86 and the median is-0.75.
The assurance is rated high by the customers.
Empathy(S)
The value of mean for the empathy criteria is -0.68 and the median is -0.60.
The empathy is rated lowest by the customers.
Tangibles (T)
The value of mean for the tangibles criteria is -0.62 and the median is -0.50.
The tangibility is rated medium by the customers.
Network (NQ)
The value of mean for the network criteria is -0.72 and the median are -0.34.
The network is rated high by the customers.
Value Added services (VAS)
The value of mean for the value added service criteria are -0.77 and the median is -0.56. The value added service is rated medium by the customers.
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Innovation (INNOV)
The value of mean for the innovation criteria is -0.89 and the median is -0.54.
The innovation dimension is rated highest by the customers.
Overall service quality is measured by obtaining an average gap score of the
SERVQUAL dimensions. It was suggested that when the perceived service
quality is high, then it will lead to increase in customer satisfaction.
vi) Comparative Analysis of Customer Service IN Mumbai Region
Out of the seven Ps of services marketing price, promotion; product (network) and physical evidence were found important. It was found that network quality contributes 49.6%, price 28.9%, physical evidence 13% and promotion 8.6%.
In order to analyze the quality of the services provided by the CMSP in
Mumbai the customers perception was taken on promotion, physical evidence, network quality and price. The result was multiplied with the % weight age of the four factors. A six sets of pair wise comparisons how well
Reliance Infocom, Bharti Airtel, Vodafone limited, Mahanagar Telephone
Nigam Limited, Loop Mobile and Tata teleservices limited perform in terms of the promotion, network, price and physical evidence was obtained from the customers.
It was found that Reliance Infocom is best in network quality and MTNL is worst, the services of Tata teleservices limited are cheapest. The promotion for MTNL is found to be the best and worst for Tata Tele services. The physical evidence is best for MTNL and worst for Bharti Airtel limited.
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In the final step the customer’s judgment as to the relative importance of the
Price, promotion, physical evidence is multiplied to obtain ranking.
Table: A-2 Ranking of CMSP on the quality customer service
SNo Factors R B T L V M 1 Network 0.12 0.09 0.07 0.06 0.90 0.03 2 Price 0.03 0.05 0.02 0.05 0.06 0.06 3 Promotion 0.01 0.03 0.01 0.02 0.02 0.04 4 Evidence 0.01 0.02 0.01 0.01 0.02 0.02 0.18 0.19 0.11 0.16 0.20 0.16 Source: research survey findings
LEGEND R-Reliance Infocom Infocom–Bharti Airtel, T- Tata teleservices Ltd. L- Loop Mobile (old name BPL), V-Vodafone Limited (Hutch), M-Mahanagar Telephone Nigam Limited Mumbai.
As per the above parameters Vodafone limited is ranked first, Bharti Airtel is ranked second, Reliance Infocom is ranked third, Loop Mobile telecom and
MTNL are ranked fourth and Tata Tele services is ranked last. The CMSP ranked first and second are offering GSM services where as the last is a
CDMA service provider.
Suggestions to bridge the Gap
i) There is an urgent need to focus on the proper management of the spectrum with an emphasis to improve the quality of customer service. ii) The CMSP shall optimize the radio frequency network to improve the coverage. The existing dark spots shall be covered immediately by improving the quality of the RF network. iii) The call centre shall be made more responsive; there is a need to improve the first time resolution .The CMSP shall start measurement of the quality of experience and make their services more friendly and easy to use.
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Limitations of the Study
i) If this research will be done across India with larger sample one may arrive at results with higher confidence levels. ii) The findings in Mumbai region will not be applicable to any other metro. iii) The perceptions and expectations of the customers keep on changing. iv) The mobile handset has a major impact on quality of customer service.
Future Scope for Research
i) This study can be repeated for all the CMSPs in Mumbai region. ii) There is an urgent need to ascertain the contribution of the mobile handsets in the perception of the quality of customer service.
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Chapter-I
Introduction to Cellular Mobile Service
1.1 Introduction
1.2 Evolution of Telecom Service in India
1.3 Segments of Telecom Service
1.4 Telecom Service Areas
1.5 Cellular Mobile Service
1.6 Postpaid and Prepaid Service
1.7 Growth in Cellular Mobile Service
1.8 Market Share of GSM and CDMA
1.9 Structure of Telecom Sector in India
1.10 Radio Frequency Spectrum
1.11 Generations of Mobile Service
1.12 Indian Telecom Laws
1.13 SWOT Analysis of Telecom Industry
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Chapter-I Introduction to Cellular Mobile Service
1.1 Introduction
The cellular mobile service (CMS) not only provides voice and data communication but also plays an important role in supporting the business processes. It enables configuration of efficient value chains for quick delivery of products. It has eliminated the need of many physical products. The need to travel from one place to another for business or socialization has reduced to a great extent. It is also playing a significant role in reducing energy consumption by real time monitoring of processes from remote locations. A recent study1 done by London school of business for a developing country concluded that a rise of ten mobile phones per hundred people boosts Gross
Domestic Product (GDP) growth by 0.6 percentage points. The increase in teledensity2 has brought many social and economic benefits to the developing country.
In view of the above the quality of customer service3 offered by Cellular
Mobile Service Provider (CMSP) has gained more importance now. This research study is of great importance because it deals with communication, one of the basic needs of human beings. It will be appropriate to understand the fundamentals of the cellular mobile service (CMS), Code Division Multiple
Access4 (CDMA) and Global System for Mobile5 (GSM) and advantages and short comings of one over the other before embarking on the main objective
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of the research study a comparative analysis of customer service provided by cellular mobile service providers (CMSPs) in Mumbai region. In this study six cellular mobile service providers (CMSP) out of existing eighteen6 CMSPs are included. Out of these Vodafone limited, Bharti Airtel limited, Loop Mobile and
MTNL7 offers GSM service while Tata Teleservices limited and Reliance
Infocom limited offered CDMA services during the period of study.
1.2 Evolution of Telecom Service in India
The history of the Indian telecom industry can be viewed in two time lines.
1.2.1. Pre Independence
In 1850, first telegraph8 line was commissioned between Diamond Harbor9 and Kolkata. In 1851, British East India Company10 started using telegraphy.
Dr William O’ Shauhnessy, who worked in Public Works Department11 (PWD), pioneered the growth of telecom in India. The pre-independence growth was restricted to the urban areas only. The British were primarily interested in using telecom to maintain law and order. In 1881, the British granted license to Oriental Telephone Company of England to install telephone exchanges in
India. They provided service till 1944.
1.2.2. Post Independence
In 1947, when India became independent, the total number of landline telephone connections were only 0.08 million12. The landline telephone was considered a status symbol. The Government of India (GOI) adopted a
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socialist model of governance. The capitalism, foreign investment and foreign collaboration were discouraged. It was decided that telecom will be a state monopoly. The telecom was included in the centre list13, it was decided that all the policies will be decided by the Government of India. All the existing private telecom companies were nationalized to create the Posts and Telegraphs
Department (P & T). The telecom department at that time was more a vehicle for providing employment to fulfill the election promises then to provide customer service. The new telecom infrastructure was added only to cities and metropolitan centers. The quality of customer service was extremely poor. The research and development (R and D) was non-existent. The department of telecom (DoT) used to procure obsolete technology from other countries and adapted them to local networks. It was not in a position to meet the required investment. The infusion of capital from the private sector was essential but the existing policy prevented this.
In early 1980s, the policy makers realized that India’s closed economy had not resulted in development. Since 1960s, the Government of India (GoI) had made up for shortfalls in its economy, through financial aid from International
Development Agency (IDA), Asian Development Bank (ADB), International
Monetary Fund (IMF) and the World Bank. In 1980s, the United States of
America (USA) became unenthusiastic in continuing aid and loans under favorable terms to India. Under this pressure, the Government of India (GoI) started taking steps towards liberalizing the economy by relaxing import restrictions. In 1985, telecom was separated from Post and Telegraph, and the Department of Telecommunications (DoT) was set up, under the Ministry of Communications and Information Technology (MoC&IT). The department of
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telecom (DoT) became exclusive provider of both local and long distance services. It was headed by bureaucrats, who followed administrative procedures in taking decisions. The combination of bureaucracy, welfare-type employment, and bad technology made the telecom service unsatisfactory.
The government, businesses and private users were not satisfied with the quality of customer service. This led to the formation of Mahanagar Telephone
Nigam Limited (MTNL) in 1986, a public-sector corporation to run telecom services in metropolitan areas such as Delhi and Mumbai. The Videsh
Sanchar Nigam Limited (VSNL) was also created in 1986 to run international telecom. In 1991 Athreya Committee14 was appointed to restructure department of telecom (DoT). It recommended five independent corporations, with Mahanagar telephone Nigam Limited (MTNL) at the apex, and recommended that DoT become an independent regulator. This was not implemented due to the pressure from the unions.
In 1991 due to Gulf war India faced foreign exchange crunch, the rising oil price, reduction in remittances from Non Resident Indian (NRI) working abroad, rising prices, and import costs. By mid-year 1991, India’s balance of payments (BoP) fell to a serious low, with only about two weeks worth of import funds left in treasury. India desperately sought the help of international aid agencies. This resulted in another major intervention by International lending agencies, requiring devaluing the Indian rupee. The financial reforms led to increased exports and foreign exchange. The economic liberalization started in 1991 led to further pressures on government to break monopoly in telecom services. The reforms also gave a big boost to enhancing telecom
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infrastructure. The Liberalization of telecom services began in 1992, with the unbundling of the basic services and introduction of VAS.
The National telecom policy (NTP) was announced in 1994. It endeavored to build world class telecom infrastructure, so that the services can be provided on demand. In addition to basic services, it also opened the telecom sector to value added services (vas) such as wireless (cellular) services, radio paging, etc. This policy gave major share of the telecom development to department of telecom (DoT) and its public sectors. It allowed only a supplementary role for private enterprises. The lucrative long distance services were retained by department of telecom (DoT). The local loop, which required heavy investments, was opened for new entrants.
The policy makers disregarded urgings of World Bank to completely privatize telecom instead they chose a middle path, the new entrant were allowed to compete for other services only after meeting their commitments in the local loop. In order to meet the resource gap the private investments became inevitable. The private cellular mobile services (CMSP) were allowed to provide basic services in the local loop, licenses were granted to eight cellular mobile telephone service (CMTS) operators in four metros cities Mumbai,
Delhi, Kolkata and Chennai, fourteen cellular mobile telephone service
(CMTS) operators in eighteen state circles15 through bidding. The licenses were issued to two CMSP in each metro.
In Mumbai region16 licenses were issued to British Physical Laboratory
17(BPL) and Hutchison Max18. The first mobile call was originated by Mr. Jyoti
Basu, Chief Minister of West Bengal in Kolkata in 1995. Since independence telecom service were provided by the Department of telecom (DoT) in India.
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After liberalization it was felt necessary to separate the regulatory and services function in department of telecom (DoT). This also became mandatory to meet the commitments made to World Trade Organization
(WTO) in 1995. In view of this Telecom Regulatory Authority of India (TRAI) was established in 1997 to provide a regulatory framework to safeguard the interests of all stake holders.
The National Telecom Policy (NTP) 1994 did not meet the expectations of the government in increasing teledensity. The cellular mobile service providers
(CMSPs) also missed the estimated revenue targets. A new telecom policy
(NTP) was announced in 1999 which became the genesis of the cellular revolution being witnessed. The aim was to start afresh, as prior policy changes had not brought forth the liberalization or the increase in teledensity as expected. A Group on Telecommunications (GoT) was formed to develop
New Telecom Policy (NTP), without representation from either department of telecom (DoT) or telecom regulatory authority of India (TRAI). The policy also set several landmarks and targets to be achieved in the coming years. It also announced to separate the policy and licensing functions of DoT from the service providing functions to ensure a level-playing-field among private operators and incumbents, two new departments’ viz. Department of Telecom
Services (DTS) and the Department of Telecom Operations, were carved out of DoT, to separate the service provision and operational functions.
In 2000, DTS was corporatized and renamed as Bharat Sanchar Nigam Ltd
(BSNL), and thus the functions of the incumbent service provider were separated from that of the policy maker. The DoT is now responsible for policy-making, licensing and promoting private investments in telecom
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services. The government realized that TRAI had to be reconstituted, with more powers and independence. The TRAI Amendment Act of 2000 curtailed the TRAI’s dispute-resolution responsibility, and made it into an advisory body whose recommendations would be non-binding on the government, licensor or the department of telecom (DoT). The amendment set up an Appellate
Tribunal known as the Disputes Settlement and Appellate Tribunal (TDSAT) to adjudicate disputes that might arise.
The New Telecom Policy (NTP-99) provided a major fillip to private sector participation in telecom. It allowed private operators providing cellular and basic service to migrate from a fixed license fee regime19 to a revenue sharing regime20 to make their operations viable. It was decided that the growth in telecom will be used to build up the Gross Domestic Product (GDP) of India.
In contrast of the duopoly practiced earlier, the new policy permitted multiple cellular mobile service providers (CMSPs). This increased competition and assisted the private cellular Mobile service providers (CMSP) to attract investment. The entry of private cellular mobile service provider (CMSP) helped to reduce their operational cost. The reduction in call rates provided a much needed boost to the industry. It also had provision to permit interconnectivity21 and sharing of infrastructure among various service providers (CMSP and Basic service operators) within the same areas of operations; it permitted both voice and data.
1.3 Segments of Telecom Service
The Telecom industry in India can be divided into two main segments namely wireline and the wireless services.
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1.3.1. Wireline Service
The wireline telephone service is provided by using cables. It includes basic wireline services rendered to households, commercial units and to service providers such as public call offices (PCO). The Wireline services are also known as the POTS (Plain Ordinary Telephone Services). The number of the wireline connections from 2004 to 2011 is shown year wise in column ‘A’ of the Table 1.1 it can be seen that the growth is negative for wire-line segments.
Table 1.1 the number of wireline, wireless, total connections and teledensity (in %) from 2004 to 2011 (In Millions). Sno Financial Wire Line Wire Less Total Tele-density year connections connections connections In % ‘A’ ‘B’ (A+B)
1. 2004 40.09 33.69 73.78 8.34 2. 2005 41.43 52.22 93.65 9.08 3. 2006 41.54 90.14 131.68 12.86 4. 2007 40.75 165.11 205.86 18.23 5. 2008 39.42 261.07 300.49 26.22 6. 2009 37.96 391.75 429.71 36.98 7. 2010 36.90 584.32 621.22 52.74 8. 2011 34.29 817.41 811.70 64.74 Source: TRAI press release March 2011
1.3.2. Wireless Service
The telephone service provided without using cables in the local loop is called wireless service. It can be provided by either GSM or CDMA technology. The
GSM dominates the wireless segment. The Indian telecom industry has made significant growth due to liberalization. In this research study the wireless
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segment will be dealt in detail. The number of wireless connections year wise from 2004 to 2011 is shown in column ‘B’ of table 1.1, it can be seen that the number of wireless connections are growing exponentially. It is increasing on an average by 8 to 10 million22 per month. The year wise teledensity in percentage is also shown in column ‘C’. The rural teledensity is 32.11% while the urban teledensity is 151%, there exist a wide disparity in the urban and rural teledensity, and this is known as digital divide23.
1.4 Telecom Service Areas
At present there are 22 circles or telecom service areas which are classified in to four groups Metro, A, B, and C. These circles cover various geographic territories of varying population sizes ‘A’ circles are the largest in terms of the population coverage ‘C’ contains the least population. The borders of the circle roughly correspond to the borders of the Indian states but there are exceptions. Some smaller states are folded into larger neighboring states and some other smaller states are combined together to form one circle.
Table 1.2 Details of Metro, A, B and C circle. Metro circles A circles • Mumbai • New Delhi • Kolkata. • Andhra Pradesh • Gujarat • Karnataka • Maharashtra • Tamil Nadu. B circles C circles Haryana • Kerala • Madhya • Assam • Bihar •Himachal Pradesh • Pradesh • Punjab • Rajasthan Jammu-Kashmir •Northeast (Arunachal Uttar Pradesh (E), Uttar Pradesh Pradesh, Manipur, Meghalaya, Mizoram, (W) and Madhya Pradesh. Nagaland and Tripura), Orissa Source: TRAI memo 2007
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The DoT circles are now called as service areas; nevertheless the term circle is widely used. The Chennai is absorbed into Tamil Nadu Circle.
From the tables 1.3, 1.4 and 1.5 it can be seen that there are three metro circles, five ‘A’ circle, eight ‘B’ circle and six ‘C’ circle. The teledensity in New
Delhi is highest in the Metro circle, teledensity in Maharashtra is highest among the ‘A’ circles, teledensity in Punjab is highest among the ‘B’ circles and teledensity in Himachal Pradesh is highest amongst the ‘C’ circles.
Table 1.3 Number of Mobile connections, CMSP, Population and teledensity. S Name of the Number Mobile Population Teledensity No. circle of CMSP connections In million In % 1. Mumbai 18 34,779,906 21.3 205.4% 2. New Delhi 9 38,818,541 18.6 222% 3. Kolkata 8 23,213,389 15.4 163% TOTAL 96,811,836 Source: TRAI press release March 2011
From table 1.3 it can be seen that the teledensity in New Delhi is highest among the metros and the teledensity in Kolkata is lowest.
Table 1.4 Number of Mobile connections, CMSP, Population and teledensity. SNo Circle Number Mobile Population Teledensity ‘A’ of connections In million In CMSP percentage 1. Andhra Pradesh 8 60,676,836 76.2 75.5% 2. Gujarat 6 46,957,643 56.4 87.4% 3. Karnataka 10 49,449,711 58.1 88.3% 4. Maharashtra 9 61,716,246 76.9 89.87% 5. Tamil Nadu 9 69,632,613 89.87 72.58% TOTAL 288,433,049 Source: TRAI press release March 2011
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From table 1.4 it can be seen that the teledensity in Maharashtra is highest among the ‘A’ circles and the teledensity in Tamil Nadu is lowest.
Tables1.5: Number of Mobile connections, CMSP, Population and teledensity. SNo Circle No. of Mobile Population Teledensity ‘B’ CMSP connections in millions in %
1. Haryana 8 20,389,507 21.1 97.2% 2. Kerala 6 31,316,008 35.02 93.3% 3. Madhya Pradesh 7 45,825,174 89.2 53.6% 4. Punjab 7 28,758,122 27.3 109.9% 5. Rajasthan 7 43,100,379 62.03 72.3% 6. West Bengal 9 39,661,517 74.56 56.7% 7. Uttar Pradesh(W) 8 45,767,008 69.17 72% 8. Uttar Pradesh(E) 8 63,679,385 120.98 55.3% TOTAL 318,497,100 Source: TRAI press release March 2011
From table 1.5 it can be seen that the teledensity in Punjab is highest among the ‘B’ circles and teledensity of Madhya Pradesh is lowest.
Table 1.6 Number of Mobile connections, CMSP, Population and teledensity. SNo Circle No. of Mobile Population Teledensity ‘C’ CMSP connection In Million In % 1. Assam 8 11,670,711 29.26 44.2% 2. Bihar 10 53,541,241 120.68 47.4%
3. Himachal Pradesh 9 7,215,932 6.61 111.7% 4. Jammu and 7 5,754,286 11.13 53% Kashmir 5. North East 7 7,184,577 12.8 60.5% 6. Orissa 9 22,415,369 40.408 59% TOTAL 107,782,116 Source: TRAI press release March 2011
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From table 1.6 it can be seen that the teledensity in Himachal Pradesh is highest among ‘C’ circles and teledensity in Assam is lowest. The teledensity of Bihar is lowest in India and the teledensity of New Delhi is highest in India.
1.5 Cellular Mobile Service (CMS)
The wireless service is also known as cellular mobile services (CMS), because the coverage areas are split into smaller areas called cells24. The coverage area has one or more transmitters and receivers that communicate with mobile handsets within its coverage area. It connects customer’s mobile handset via radio25 channels to base stations. Some of the radio channels are used for control purposes and the remaining is used to carry customer traffic.
The Cellular systems are designed to overlap each cell border with adjacent cell borders to enable a handoff26 from one cell to the next. As customer moves through a cellular system, the mobile switching center (MSC) coordinates and transfers calls from one cell to another and maintains continuity. The operators licensed to provide the cellular services are known
Cellular Mobile Service Providers (CMSPs) whereas the services are called
Cellular Mobile telephone Service (CMTS).
The Global System for Mobile Communications (GSM) and Code Division
Multiple Access (CDMA) are deployed in India. Both these technologies have developed significantly in recent years. The Global System for Mobile
Communications (GSM) customers is growing at phenomenal rate in India; it is accounts for 78% and the remaining 22% is Code Division Multiplexing
Access (CDMA).
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It can be seen from the table 1.7 below that the GSM connections are five times that of CDMA connections.
Table1.7 Market Share of GSM and CDMA SNo Year CMDA GSM Total 1 2005 11.75 41.07 52.22 2 2006 20.95 69.19 90.14 3 2007 44.64 165.11 120.47 4 2008 68.37 192.7 261.07 5 2009 94.5 297.26 391.76 6 2010 105.64 478.68 584.32 7 2011* 155 599 754 Source: TRAI press release, ‘*’ as on June 2011
1.5.1 Global System for Mobile Communications (GSM)
The birth of GSM can be traced to early 1980s when a group of 26 European telecom administrators, called the Conference of European Posts and
Telegraphs (CEPT) commissioned a study group named as Global System for
Mobile Communications (GSM). The group set out to design a system with a vision to provide good speech quality and support International roaming27 and a range of value added services. This standard was released in 1989, by the
European Standard and Technology Institute (ETSI).
The first Global System for mobile communication (GSM) call was made by
Finnish Prime Minister Harri Holkeri on 1st July 1991. The historic call used the Nokia handset. The GSM services were launched in parts of Europe in
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1991 and the standard went to countries like Denmark, Finland, France,
Germany, Italy, Portugal and Sweden in 1992.
The Global System for Mobile (GSM) is a form of multiplexing28, which divides the available bandwidth29 among the different channels. It is a combination of
Time Division Multiple Access (TDMA) and Frequency-Division Multiple
Access (FDMA)30. The FDMA part involves the division of frequency band of
25 MHz bandwidth into 124 carrier frequencies31 spaced 200 kHz apart. Each of these carrier frequencies is then divided in time, using a time division multiplexing scheme (TDMA)32. The fundamental unit of time in Time Division
Multiplexing Access (TDMA) scheme is called a burst period33 and it lasts
15/26 ms (or approx. 0.577 ms). One physical channel is one burst period per
Time Division Multiple Access (TDMA) frame. The Global System for Mobile communication (GSM) technology allows eight simultaneous calls on same radio frequency. The power of the signal is concentrated in a narrower band which makes it easier to detect. It is portable from one hand set to another by changing Subscriber Identity Module 34(SIM) cards; the user can change phones and retain same mobile number. It is roaming friendly and allows user greater flexibility, which accounts for its popularity. To ensure privacy, Global
System for Mobile communication (GSM) systems has to add an extra stage of encryption.
1.5.2. Code Division Multiple Access (CDMA)
In 1940, Hollywood actress turned inventor, Hedy Lamarr, and co-inventor
George Antheil, patented a way for torpedoes to be controlled by sending signals. The idea remained dormant until 1957 when engineers at the
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Sylvania Electronic Systems Division, in Buffalo, New York took up the idea, and used it for secure communications during the 1962 Cuban Missile Crisis.
After becoming an integral part of the military, in the mid-80s, declassified what has now become Code Division Multiple Access (CDMA) technology.
M/s. Qualcomm35 patented and it became popular in European countries.
In 1995 Code Division Multiple Access (CDMA) was launched commercially in
Hong Kong. The audio signal is first digitized into binary elements. The frequency of the transmitted signal is then made to vary according to a defined pattern code36, so it can be intercepted only by a receiver whose frequency response is programmed with the same code, so it follows exactly along with the transmitter frequency. It was preferred by military because coded signals with trillions of possible combinations resulted in extremely secure transmissions.
The Code Division Multiple Access (CDMA) is also a form of multiplexing which allows the use of a particular frequency for a number of signals, optimizing the use of available bandwidth. This technology is used in the 800-
MHz and 9 GHz bands. The number of channels (users) that can be allocated in a given bandwidth is comparatively higher for Code Division Multiple
Access (CDMA) than for GSM. The cost of setting up a Code Division Multiple
Access (CDMA) network is comparatively less than the GSM network. It transmits signals only when the user starts conversation. It supports
Removable user identity Module (RUIM37) card. This means that cell phone is locked or cannot be used with other cellular Mobile service providers (CMSP) network. In India Minutes of Usage (MoU) for Global System for Mobile
Communication (GSM) services is more as compared to Code Division
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Multiple Access (CDMA). It supports a maximum of 131 connections, compared to 48 Global System for Mobile Communication (GSM) connections in a similar bandwidth. The GSM technology needs four time more Base
Transceiver System as compared to CDMA. It supports soft handoff 38 good voice quality (using Voice Coding) perfect power control. Its spectrum utilization is 4 to 6 times more efficient than Global System for Mobile
Communication (GSM). It can be concluded that Code Division Multiple
Access (CDMA) is an efficient technology for spectrum utilization but has a main disadvantage that it does not support service portability and international roaming.
1.5.3 Average Revenue of Wireless Customers
The Average Revenue per user (ARPU) of the Global System of Mobile
Communications (GSM) services decreased from Rs 298 to 100, the Average
Revenue per user (ARPU) of the Code Division Multiple Access (CDMA) services also fell from Rs 202 to 66. The reduction in both the cases is approximately one third due to the reduction in the call rates.
Table 1.8: the Comparison of the CDMA and GSM revenue SNo YEAR GSM CDMA GSM CDMA Till March ARPU ARPU MoU MoU 1. 2007 298 202 471 471 2. 2008 253 179 498 371 3. 2009 205 99 484 357 4. 2010 115 78 423 289 5. 2011 100 66 349 263 Source: TRAI press release March 2011
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1.6 Postpaid and Prepaid Service
The cellular mobile service providers (CMSPs) offer Cellular Mobile Service
(CMS) in two flavors postpaid and prepaid. In postpaid service a customer sign a contract with the cellular mobile service provider (CMSP), a rental is charged every month the customer has a choice to select a plan as per his calling pattern. A bill is generated for the rental and usage in the end of the month. The prepaid services don’t require any contract and can be used without any monthly rental charge. The customer has a choice to recharge his account by recharge coupons. The postpaid service is used by corporate customers while the prepaid services are mostly used by individuals. The
Minutes of Usage (MoU39) for prepaid segment is less as compared to postpaid. The prepaid services are very popular in India, with a customer base of 93%.
Table 1.9 the Postpaid and Prepaid component for GSM and CDMA. SNo Technology GSM CDMA
1. Prepaid 93.10% 94.30%
2. Postpaid 6.90% 5.70%
Source: TRAI press release March 2011.
1.7 Growth in Cellular Mobile Service
In 2010 the number of cellular mobile connection touched five billion40 globally. At this rate of growth it may touch six billion in the year 2012. It
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means one connection in the hand of every single person aged fifteen years or older, across continent, beyond illiteracy, electricity, poverty etc .On analysis41 of five billion mobile connections it was found that only 4.1 billion are active users, out of this 3.6 billion are unique users. Out of the 3.6 billion unique customers, 1.1 billion have two or more connections and 300 million people have three or more active connections. Of the above 1.1 billion people with more than one account, 500 million have two connections they carry around regularly.
The world human population of 6.8 billion is unevenly distributed; 1.2 billion live in the developed nations like Europe and America where as remaining 5.6 billion live in developing nations like Africa, Latin America and Asia. The teledensity in developed nations is more than hundred percent where as it is
52 percent in the developing nations. In the future the developing nations will be the main contributors in the growth of mobile services.
If a comparison between the number of mobile connections is made with any other consumer goods, at the end of 2009 world had just less than 1 billion automobiles, a little over 1.1 billion landline connections, 1.2 billion personal computers, 1.6 billion television sets and 2.2 billion bank account holders. It can be seen that with more than five billion customers the mobile service industry is a gigantic.
Table: 1.10: the teledensity of urban and rural populations. Sno Type of Area teledensity 1. Urban India 150.67% 2. Rural India 32.11 3. Total 67.67% Source TRAI press release January 2011
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The digital divide in teledensity is due to the poor infrastructure in the rural areas. In 2001 the number of customers in the country was approximately 5 million which has grown to 671 million on date. The count of customers in
India will soon exceed the total customers count in China by 2013 at a growth rate of over 26 percent, and generate employment opportunities for about 10 million people.
1.8 Market Share of GSM and CDMA
The cellular mobile service (CMS) has witnessed significant growth in the past few years. The private sector has played an important role in the rapid growth of wireless segment. Their market share consists of 86% of the total wireless customers. In the present scenario eighteen cellular mobile service providers
(including 1 PSUs) compete in Mumbai region. Only three private players,
Vodafone limited, Bharti Airtel and Reliance Infocom limited, are pan India.
The remaining are regional players. The global system for mobile system
(GSM) sector is dominated by players such as Bharti Airtel; Vodafone limited and Idea Cellular, while the CDMA sector is dominated by Reliance Infocom and Tata Indicom. Bharti Airtel is the largest GSM operator.
1.9 Structure of Telecom Sector in India
The structure of the telecom sector consists of a number of CMSP in public and private sector, telecom regulator, original equipment providers, wireless telecom dispute settlement body and associations of the service providers.
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1.9.1. Cellular Mobile Service Provider
Currently, both public sector players as well as the private sector cellular mobile service providers (CMSPs) are actively catering to rapidly growing mobile services in India. It can be divided broadly into two categories.
1.9.2. Public Sector
Only two premier PSUs, Mahanagar Telecom Nigam Limited (MTNL) and
Bharat Sanchar Nigam Limited (BSNL) provide various telecom services in
India. While MTNL operates in Delhi and Mumbai, BSNL provides services to the rest of the India. In the post-liberalization era, these PSUs have made significant progress but also provided stiff competition to their private counterparts. The license for operating the mobile service to BSNL and MTNL was allotted in 1999 and 2001 respectively when oligopoly was allowed.
1.9.3. Private Sector
After the introduction of New Telecom Policy (NTP-99), the contribution of private players witnessed rapid growth. While the private sector is instrumental in providing both fixed line as well as wireless services, it is mainly active in the wireless segment. While some private players have a pan-India presence, there are many regional players that cater to only certain service areas. There are two types of private sector companies. They are private companies with Indian ownership example Bharti Airtel, Spice etc and private invested foreign companies’ example Vodafone limited etc. The private CMSP have played a very crucial role in the growth of telecom industry, primarily in cellular mobile services. The private sector has been
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increasing its foothold in telecom industry. The initiatives such as allotting third and fourth cellular licenses, shifting to a unified access licensing regime42, execution of calling party pays43 (CPP) regime, making incoming calls free, also drew significant growth in the mobile connections.
Table 1.11 the list of the Pan India and regional CMSP in India.
SNo CMSP PAN Regional GSM CDMA % Market Share 1. Bharti Airtel yes X Yes X 19.86 2. Vodafone limited yes X Yes X 16.62 3. BSNL X yes Yes Yes 11.00 4. Loop Mobile X yes Yes X 0.37 5. MTNL X yes Yes Yes 0.65 6. Videocon X yes Yes X 0.84 7. Idea X yes yes X 11.17 8. Aircel X yes yes X 6.81 9. Tata yes X yes Yes 10.68 10. RCOM yes X yes Yes 16.82 11. STEL X yes yes X 0.39 12. Uninor X yes yes X 3.09 13. Sistema X yes yes X 1.38 14. HFCL X yes yes X 0.16 15. Etisalat X yes yes X 0.16 Source own work
1.9.4. Wireless Planning & Coordination (WPC).
It was created in 1952 for Spectrum Management; it exercises all statutory functions of the Government of India (GoI) and issues licenses to operate wireless services. It is divided into major sections Licensing and Regulation
(LR), New Technology Group (NTG) and Standing Advisory Committee on
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Radio Frequency Allocation (SACFA).It makes recommendations on frequency allocation issues, formulation of the frequency allocation plan and gives recommendations related to International Telecom Union (ITU).
1.9.5. Telecom Regulatory Authority of India (TRAI)
The role of TRAI is to provide a fair and transparent policy environment which promotes a level playing field and fair competition. In order to meet these objectives it issues directions, orders and regulations which cover a wide range of subjects including tariff, interconnection and quality of service. The functions of TRAI can be divided as Recommendatory functions and
Mandatory Functions.
A. Recommendatory Functions
i) To decide need, timing, terms and conditions for introduction of new CMSP. ii) To facilitate competition and promote efficiency and inspect the type of equipment used by CMSP. B. Mandatory Functions
i) Finalise the terms and conditions of interconnectivity between CMSPs and regulate arrangements for sharing of revenues. ii) Lay down the standards of service quality, ensure this by periodical survey and ensure compliance of Universal Service Obligation (USO).
1.9.6. Telecom Disputes Settlement Tribunal (TDSAT)
In January 2000, TRAI was split into two agencies, a new TRAI, divested of all its adjudicatory and dispute-settling powers, and a newly created agency named Telecommunications Dispute Settlement and Appellate Tribunal
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(TDSAT). The TDSAT was empowered to adjudicate on disputes between the licensor and licensee, between two or more CMSPs and between a CMSP and a group of consumers. It was also an appellate authority with respect to any direction, decisions and orders of telecom regulator authority of India
(TRAI). The cases involving questions of monopoly and consumer grievance redressal by individual consumers are outside this body’s jurisdiction. The decisions of telecommunication Dispute Settlement and Appellate Tribunal
(TDSAT) can be appealed only to the Supreme Court of India.
1.9.7. Cellular Operator Association of India (COAI).
It was constituted in 1995 as a nonprofit organization. It was set up with a vision to facilitate establishment of a world class mobile services and deliver the benefits of affordable mobile telephony services to people of India. Its core membership includes Global system for mobile services (GSM) private cellular operators and a number of telecom infrastructure providers. It collaborates with other Industry Associations with the objective of presenting consensus on crucial issues relating to growth and development of Cellular
Industry in India. It also interacts with press and media to ensure that issues pertaining to cellular industry are understood and debated.
1.9.8. Sales Channel of CMSP
The sales channel of the CMSPs consists of the CMSP, distributors, feeders, runners and customers. The CMSP have divided the Mumbai region into five, eight and nine zones as per their convenience and customer data base. Each zone is headed by a zonal sales manager. The zonal managers report to
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territory manager. The zonal and territory manager are appointed by Cellular
Mobile Service providers (CMSPs).
CMSP --- Distributor--- Feeders--- Runners- Mobile Customers
The distributors deal with cellular mobile service providers (CMSP) and arrange SIM cards and recharge coupons for distributors as per the market demand. They also implement promotional schemes offered by CMSP from time to time. They have a number of retailers and feeder under their control to reach out to the customers. The distributors supply the inventory to the feeders that control the retail market with the help of the runners. The runners help in the sales, installation and activation, collection of cash, servicing recharge vouchers to customers and retailers, creating representative, daily report to the feeder on the orders booked and orders completed. They are directly in touch with the customers. In Mumbai the runners are common for all the cellular mobile service providers (CMSP).
1.9.9. Association of United Telecom Service Providers in India
It is association of Unified Access Service Licensees (UASL) providing Code
Division Multiplexing Access (CDMA) and Global system for mobile communication (GSM) Mobile Services; landline services as well as value added services. It is a non-profit organization with the aim of delivering improved access, coverage and teledensity in India. It deals with collection and dissemination of knowledge and information for promotion and healthy
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growth of telecom services and improving teledensity and bringing value for customers. It interacts on policy and regulatory issues with different agencies similar to the COAI.
1.9.10. International Telecom Union (ITU)
It is an agency of the United Nations Organization. It coordinates shared use of the spectrum globally, promotes international cooperation in assigning satellite orbits, works to improve telecom infrastructure and establishes worldwide standards. Its mission is to enable growth and sustained development of telecom and information networks, and to facilitate universal access to the emerging information society and global economy. The main priority of International telecom union (ITU) is bridging the digital divide by building adequate telecom infrastructure and developing confidence in the use of cyberspace. India is an active member of ITU.
1.10 Radio Frequency Spectrum
The Radio frequency (RF) spectrum is an essential resource for running
Cellular Mobile Service (CMS). The word spectrum refers to electromagnetic radiations between 9 kHz and 3000 GHz. It can be shared by different users accessing the same frequency band without causing interference. It is not consumed upon its use and it can be shared amongst the various radio services and must be used efficiently, optimally and economically in conformity with national and international laws. All nations share electromagnetic spectrum and reserve their right to its unlimited use. In order
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to support trade, cooperation and mutual protection against interference, they agree to ITU guidelines. The National Frequency Allocation Plan (NFAP) forms the basis for spectrum utilization in India.
1.11 Generations of Cellular Mobile Services
The first radio telephone service was introduced in the United States of
America (USA) at the end of 1940s, and was meant to connect mobile users in cars to the public fixed network. In the 1960s, a new system launched by
Bell Systems, called Improved Mobile Telephone Service (IMTS), brought many improvements like direct dialing and higher bandwidth. The first analog cellular systems were based on IMTS and developed in the late 1960s and early 1970s. The evolution of mobile communication is classified into generations.
1.11.1. First Generation (1G)
The first generation analog system for mobile communications saw two key improvements during 1970s, the invention of the microprocessor and the digitization of the control link between the mobile phone and the cell site.
AMPS (Advance mobile phone system) were first launched which were 1G mobile system. It was based on frequency division multiple access (FDMA) technology which allows users to make voice calls within one country. There was no concept of roaming.
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1.11.2. Second Generation (2G)
The second generation cellular systems were first developed at the end of the
1980s. These systems digitized not only control link but also the voice signal.
The new system provided better quality and higher capacity at lower cost to consumers. GSM was the first commercially operated digital cellular system which is based on time division multiple accesses (TDMA).
1.11.3. Third Generation (3G)
The third generation systems promise faster telecom services, including voice, fax and Internet, anytime and anywhere with seamless global roaming.
The first 3G network was deployed in Japan in 2001. It supports 144 Kbps bandwidth, with high speed movement (e.g. vehicles), 384 Kbps and 2 Mbps for stationary.
1.12 Indian Telecom Laws
The Indian telecom laws cover all the areas of telecom operations right from licensing, operations and settlement of consumer complaints. It has exhaustive provisions for safe guarding the interest of the customers. Some of the mostly referred acts are given below.
1.12.1. The Indian Telegraph Act 1885
As per this act Government of India is vested with the exclusive privileges to make laws for the conduct of telegraph. It can take possession of the licensed telegraphs or order interception of messages, permit establishing telegraph
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facility on railway tracks and can also notify the rates for transmission. It contains provisions of penalty in case of unauthorized use of the equipment and breach of the license conditions. A dispute concerning any telegraph line, appliance or apparatus arises between the telegraph authority and the person shall be determined by arbitration appointed by the Government of India
(GoI). The award of the arbitrator shall be conclusive between the parties and shall not be questioned in any court.
1.12.2. Indian Wireless Telegraph Act, 1933
The telegraphy authority constituted under the Indian Telegraph Act, 1885, shall be the authority competent to issue licences to possess wireless telegraphy apparatus under this Act, and may issue licences in such manner, on such conditions and subject to such payments, as may be prescribed.
Whoever possesses any wireless telegraphy apparatus, other than a wireless transmitter, in contravention of the provisions of this act shall be punished.
1.12.3. Consumer Protection Act 1986
The Consumer Protection Act, 1986 lays down the rights and privileges of customer in India. The first and the only act of its kind in India, it has enabled ordinary consumers to secure less expensive and often speedy redressal of their grievances. In order to provide inexpensive, speedy and summary redressal of consumer disputes, these quasi-judicial bodies have been set up in each district and state and at the national level, called the district forums; the state consumer disputes redressal commissions and the national consumer disputes redressal commission respectively. The remedy under the
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consumer protection act is an alternative in addition to that already available to the aggrieved persons/consumers by way of civil suit. In the complaint/appeal/petition submitted under the act, a consumer is required to pay a nominal fee. If a consumer is not satisfied by the decision of a district forum, he can appeal to the state commission and national commission.
1.12.4. Universal Access Regime 2001
In 2001, basic service operators in India were permitted to offer limited wireless in local loop (WLL) with limited mobility using code Division
Multiplexing Access (CDMA) technology in their license areas. They were also able to offer all-India mobility using this technology. It resulted in increasing the popularity of these services, as the prices of these services were lower than that for GSM. This created a disadvantage for the GSM cellular operators as they had paid substantial amounts to obtain their licences and
WLL (M) services were increasingly seen as largely substitutable for GSM services; as a result, the government decided to move towards a Unified
Access Services Licensing (UASL) regime for basic and cellular services, which was introduced in October 2003. Under the new licensing regime, both basic service operators and cellular carriers gained freedom to offer basic and or cellular mobile services using any technology, which has ensured a fair competitive market for the service providers.
1.12.5. Universal Service Obligation Fund 2002
In order to increase teledensity, the government set up a Universal Service
Obligation Fund (USOF) in 2002. This fund is expected to help in achieving
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universal service obligations as laid down in the New Telecom Policy (NTP)
1999. The Indian Telegraph Act (1885) has been amended and mobile services have been included under basic telephony in rural areas to further help the CMSP to access the universal service obligation fund (USOF), which will help them to finance telecom infrastructure in rural areas. The resources for meeting the USO would be raised through a ‘universal access levy’. The implementation of the USO obligation for rural and remote areas would be undertaken by all fixed service providers who will be reimbursed from the funds collected from the universal access levy.
It can be seen that there is a wide gap between the collection and reimbursement. An amount of Rs. 7000 crores are reimbursed to BSNL.
Table 1.12 The details of the USO collected and disbursed.
SNo Year Collection Reimbursed 1. 2002-03 1653.61 300 2. 2003-04 2143.2 200 3. 2004-05 3457.7 1314.6 4. 2005-06 3533.3 1766.9 5. 2006-07 4211.1 1500 6. 2007-08 5405.5 1290 7. 2008-2009 5515.14 1600 8. 2009-2010 5778 2400 9. 2010-2011 6114 3100 Total 37223 13471.44 Source: TRAI report of USO June 2011
1.12.6. Indian Competition Act 2002
The Competition Act, 2002 was passed by the parliament in the year 2002. It was subsequently amended by the Competition (Amendment) Act, 2007. In accordance with the provisions of the Amendment Act, the Competition
Commission of India (CCI) and the Competition Appellate Tribunal (CAT)
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have been established. It deals with the anti-competitive agreements and abuse of dominant position.
The aim of the Commission is to make markets work well for consumers through effective competition. The advantages to various sectors arising out of competition should percolate to consumers and businesses for level playing field, redressal against anti-competitive practices, competitively priced inputs and optimal realization from sale of assets.
1.12.7. Interconnect Usage Charges Regime (IUC) 2003
Interconnection is very important for the CMSP and customers as it influences the price of the services. A variety of access networks fixed and mobile, national long distance network and international long distance networks have to interconnect with each other to make local, national and international calls possible. In order to have seamless service, it is imperative to have an effective interconnection usage charges (IUC) regime in place.The TRAI implemented the Telecom Interconnection Usage Charges (IUC) Regulation during 2003 to fix the terms and conditions of interconnectivity between service providers, to ensure effective interconnection between different service providers and to regulate arrangements among service providers for sharing their revenue derived from providing telecom services.
1.12.8. Consumer Protection and Redressal Grievance Regulation 2007
All the CMSPs come under the purview of this regulation. They shall provide a call centre for redressal of consumer’s grievances and such toll free call centre shall be accessible to its customers 24x7, 365 days. The calls shall be
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answered as per service quality parameters. The CMSP shall advertise the number through press. A unique docket number is to be given to all the complaints received at the call centre. The redressal mechanism is provided in three tiers call centre, Nodal officer and Appellate Authority and the secretariat.
The appellate authority has to submit a report of the receipt and the disposal of the complaints. All the CMSPs are also advised to publish a manual on consumer education. The provision of these regulations is in addition to consumer protection act 1986 or any other law in force.
1.13 SWOT Analysis of Telecom Industry
The Indian telecom industry is one of the fastest growing telecom markets in the world. The reforms introduced by the government in the last decade have improved the telecom infrastructure. India is the second largest market in the world with a customer base of 885.9 million as on June 2011. A Strengths
Weakness Opportunity and Threats analysis was done to better understand the future of the industry.
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TELECOM INDUSTRY IN INDIA Strengths Weaknesses Unexploited customer base. Requires huge initial fixed. Lowest call tariff in the world. Non availability of spectrum. Friendly economic policies. Slow pace of reforms and License Large talent pool and low labour conditions are not clear. Cost. The total regulatory fees are Value added services are between 17 ~ 26%. popular. The levies are also high. Both GSM and CDMA in use. The low tariffs, falling ARPU’s. External Opportunities Threats World’s largest untapped mobile The absence of clear separations market with growth potential. in policy, regulation and Wide acceptance of VAS. operations. The telecoms trends in India will Delays in decision making. have a great impact on other IT Integration during Mergers is industry. challenging. Small and medium businesses Increase in competition from new in India are spending more on players. telecom services. The hike in Value Added Tax 3G will further augment the (VAT) on cell phones from 4 to growth rate and revenues. 12.5 percent. SWOT Analysis Conclusion The Indian telecom market is unexploited; still there is a possibility of 400-500 million new connections. The citizens have started using the mobile applications. Hence there is a huge scope for CMSPs. Chart 1.1 the SWOT Analysis of telecom industry in India
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Chapter -II The Process of Providing CMTS
2.1 CMTS License
2.2 Allotment of Spectrum
2.3 Service Roll out plan
2.4 Service Marketing Mix of CMS
2.5 Challenges in Segmentation
2.6 Market Strategy
2.7 Market Research
2.8 Business Models Employed by CMSP
2.9 Life Cycle of CMS
2.11 Commercial Launch of CMS
2.12 Appointment of Sales Channel
2.13 Monitoring QoS and Security Issues
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Chapter -II The Process of Providing CMTS
2.1 Cellular Mobile Telephone Service (CMTS) License
As per the Indian Telegraph Act 1885, a license is required for operating
Cellular Mobile Telephone Service in India. Any Company, registered under the Indian Companies Act’1956, can apply for the license. The total foreign equity in the company shall not exceed 49% at any time during the entire license period. The license is awarded circle wise. A company can apply for any number of circles. The license is issued on non-exclusive basis, for a period of 20 years, further extendable by 10 years. The company has to pay one time entry and license fee annually @ 17% of Adjusted Gross Revenue
(AGR). A financial bank Guarantee (FBG) of Rs. 500 million is to be paid before signing the license agreement.
2.2 Allotment of Spectrum
The spectrum is allotted as per the National Frequency Allocation Plan
(NFAP).The Global System for Mobile Services (GSM) technology works in frequency bands of 900 and 1800 MHz while Code Division Multiple access
(CDMA) technology works in 800 MHz band. It is essential to allocate spectrum to cellular mobile service providers (CMSPs) in the same bands
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which are being used world over for smooth operation of international roaming44 facilities and enable the customers to enjoy the services without changing mobile handset while traveling abroad. The frequencies for operation are assigned by WPC from the designated bands prescribed in
National Frequency Allocation Plan - 2000. (NFAP-2000)
2.2.1 GSM Band
In India 25 MHz spectrum in 900 MHz band (890 – 915 to 935 – 960 MHz) and 75 MHz in the 1800 MHz band (1710 – 1785 to 1805 – 1880 MHz) is reserved for GSM services. In this band, a total of 20.2 MHz is available for
GSM networks and Railways out of 25 Mhz. where as in the GSM 1800 band out of 75 MHz only 15 MHz is available for use the remaining 60 MHz is occupied by Defense. With the GSM license an initial allotment of 2x4.4 MHz spectrum is provided.
2.2.2 CDMA Band
In India 20 MHz spectrum in the 800 MHz band (824 – 844 / 869 – 889 MHz) is reserved for CDMA services. In this spectrum, 14 CDMA carriers of nominal
1.25 MHz each are possible for assignment to CMSP. With the CDMA license an initial allotment of 2 x 2.5 MHz spectrum is provided.
2.2.3 Spectrum Management Committee
The Spectrum Management Committee (SMC) consisting of Group of
Ministers, and Wireless Planning Commission was nominated by the
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Government of India for pricing spectrum. It assessed the relative merits of plans proposed by various competing firms and granted a share of the spectrum accordingly. The spectrum charges were earlier based on number of mobile customers and allocated spectrum. Since August 1999, the spectrum charges were converted to percentage of AGR (Annual Gross
Return). The amount increases with the increased allocation45.The CMSP in
Mumbai have been allocated up to 10 MHz, whereas the demand is higher than 10 MHz. With the 900 MHz GSM band completely occupied, the allocation beyond 8 MHz to each operator is possible only in 1800 MHz band.
In 800 MHz CDMA band, some licensees have been allotted up to 3 carriers, out of a total of 4.
2.3 Service Roll out Plan
The CMSP has to submit a business plan along with its funding arrangement for financing the project and how it will meet the roll out obligations. As per the license conditions they are responsible for Installation of infrastructure for providing the service, networking and operation of necessary equipment and systems, treatment of subscriber complaints, issue of bills to its subscribers, collection of revenue, attending to claims and damages arising out of operations. As per the roll out obligations in metros, 90% of the service area shall be covered within one year of the issue of the license.
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2.3.1. Blocks of Cellular Mobile System
The details of the equipment required by the CMSP for offering the cellular mobile services are:
2.3.2 Network Switching System (NSS)
It mainly performs call processing and service related functions and store five important data bases essential for the operation of the CMS. These five databases of the systems are Home Location Register (HLR), Mobile
Services Switching Center (MSC), Visitor Location Register (VLR),
Authentication Center (AUC) and Equipment Identity registers (EIR). i) Mobile Services Switching Centre (MSC)
It performs call switching functionality. It controls the calls to and from other mobile numbers, which means it controls calls from same networks and calls from other networks toll ticketing, common channel signaling, network interfacing etc. ii) Home Location Register (HLR)
It is a database it contains customer service profile, status of activities, information about locations and permanent data. When new connections are sold, the customer data is registered in HLR. It also stores the Individual
Subscriber Authentication Key (Ki) for each Subscriber Identity Module (SIM). iii) Visitor Location Register (VLR)
It is a database which stores temporary data regarding customers which is needed by Mobile Switching Center (MSC). It is directly connected to MSC, when subscriber moves to different MSC location, Visitor location register
(VLR) integrates to Mobile Switching Centre (MSC) of current location and
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requests the data about customer or Mobile station (MS) from the Home
Location Register (HLR).
iv) Authentication Centre (AUC)
It is an important data base to authenticate and encrypt those parameters which verify user’s identification. This database contains the International
Mobile Subscriber Identity (IMSI) the Subscriber Authentication key (Ki), and the defined algorithms for encryption. v) Equipment Identity Register (EIR) It contains information about the identity of mobile equipment and is used to prevent usage of stolen, unauthorized or defective mobile stations.
2.3.3 Base Station System (BSS)
The base station system is outdoor unit which is responsible for connecting subscribers (MS) to mobile networks. All the communication is made in radio transmission. The Base station System is further divided in two sub systems, they are BSC and BTS.
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Chart 2.1 the block diagram of cellular Mobile system.
i) BASE Station Controller (BSC)
A Base Station normally controls many cells; it registers subscribers, responsible for hand over etc. It creates physical link between customer’s mobile handset and Base Transreciever Station (BTS). It performs the switching function by handover over of the MS (Mobile Station) to next Base
Station Controller (BSC) when MS goes out of the current range of BTS; it helps in connecting to next BTS in range to keep the connection alive within the network. The Mobile Switching Centre (MSC) acts as bridge between different mobile networks. It provides the control function and physical links between the MSC and BTS. The BSC provides functions such as handover, cell configuration data, and control of radio frequency (RF) power levels in
Base Transceiver Stations.
ii) Base Trans receiver Station (BTS)
This network element handles the radio interface for the mobile station. The
BTS is the radio equipment needed to service each cell in the network. The
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customer connects to mobile network through BTS; it handles communication using radio transmission with mobile station. As name suggests, Base Trans receiver station is the radio equipment which receives and transmits the voice and data at the same time. One BSC controls a group of BTS.
2.3.4 Operation and Support System (OSS)
It provides an overview of network; support and maintenance activities are other important aspects of Operation and Support System.
2.3.5 Operations and Maintenance Centre (OMC)
The OSS helps in mobile networks to monitor and control the complex systems. It helps in managing and centralizing local and regional operational activities required in mobile networks.
2.3.6 Billing and Customer Centre
The billing and customer care module is used for generation of bill, service provisioning and customer care.
2.3.7 Other Miscellaneous Units i) Message Centre (MXE)
A network element which provides Short Message Service (SMS), voice mail, fax mail, email, and paging. ii) Mobile Service Node (MSN):
It is a network element which supports the prepaid and value added services.
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iii) Gateway Mobile Services Switching Centre (GMSC)
A network element used to interconnect two mobile networks. iv) GSM Interworking Unit (GIWU):
This is the network element which interfaces with other data networks.
2.4 Service Marketing Mix for Cellular Mobile Service
The marketing of cellular mobile services is moving from transactional marketing to relationship marketing. It focuses on getting customers and keeping them for a life time. The satisfied customers recommend service to others, resulting in an increase in sales. The fulfillment of the customer satisfaction is the key to success, to achieve this cellular mobile service provider (CMSP) take lots of efforts.
McCarthy (1960) suggested the concept of marketing mix (the 4Ps)-product, price, place and promotion. These variables form key elements within the marketing function, and is adopted by cellular mobile service providers
(CMSPs) to generate and sustain customer satisfaction. Each ‘P’ contains various factors that can be emphasized to meet customer needs. The market mix decides which customer segment is addressed. It is their aim to get positive response by mixing these together. In case of mobile services core product is radio frequency network. The customer pays for the use of network to remain connected. The cellular mobile service is retailed through the shops bundled with subscriber identity module (SIM).Other types of wireless products are WAP (Wireless Application Protocol) and General Purpose
Radio Standard (GPRS).These are used for downloading ring tones, games,
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information and other value added services. The final product offered by
CMSP is cellular mobile service.
The service marketing mix is also known as an extended marketing mix. It consists of seven P’s as compared to the four P’s of a product marketing mix.
The service marketing mix assumes the service as a product. It adds three more P’s which are essential for optimum service delivery. The extended service marketing mix places three further P’s which include People, Process and Physical evidence necessary for optimum service delivery. The product in service marketing mix is intangible in nature. The place in case of mobile services determines at which location the service will be offered. In case of the mobile services it is the availability of network. The cellular mobile services are easily duplicated and hence it is the brand which sets a service apart from its competitor. Hence promotions have become a critical factor in the mobile service marketing mix. The cellular mobile service providers
(CMSP) spend a big amount on promotion. The people are one of the important elements of service marketing mix, who define the service. The role of the people in case of mobile service marketing is very critical. The CSMP are getting their staff trained in interpersonal skills with a focus towards customer satisfaction.
2.5 Challenges in Segmentation
As per the TRAI data for financial year 2010-11, 93% of mobile customers in
India use prepaid. Out of this around 25-30% are dual SIM46 customers. The customers prefer mobile services which offer lowest call rates. In order to
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save money customers switch subscribers Identity Module (SIM) for making calls. In the case of postpaid customers, it is possible to determine the value to create segments and marketing plans. But in the case of prepaid subscriptions, customers buy connections mostly from distributors. The distributors are unable to capture sufficient demographic data. The data which is captured is not transmitted to the cellular mobile service providers. The
CMSPs are facing challenge in segmenting the customers and have adopted blanket marketing strategies which are not very effective.
As the growth is getting saturated the impact on the value produced by each customer is not known. In order to increase growth analysis of data on usage patterns to create better segmentation is a must. The key to this segmentation strategy is to create buckets as small as 50,000 users.
Once these segments are created then targeted marketing strategies can be employed successfully. The rationale behind segmentation is discussed below to identify customers on the basis of their stage in life and hence to offer tailor made schemes for each segment.
i) Youth: This segment has emerged as the largest user of mobile
services, for them mobile phones are indispensable accessories.
This segment particularly values prepaid schemes with free short
message services (SMS). It is further differentiated into various
micro-segments based on age and gender. The youngsters in the
age group of 19 to 23 years have a large circle of friends and
limited access to money. The cellular mobile service providers
(CMSP) are focusing on providing services like group talk and
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group messaging services. This segment is very dynamic and
driven by latest trends. ii) Young Professionals: The youth entering the workforce and thus
moving out of the dependent bracket constitute this segment. They
generally prefer using postpaid schemes with value added services
like information about stock markets and news updates. iii) Small and Medium Enterprise: This segment mainly consists of
people who are switching over from landlines to mobile phones,
seeking a cost advantage. The focus here is on economy packages
rather than value added Services. iv) Family: The Family as a segment consists of more number of
dependents. They prefer prepaid schemes. The geographically
dispersed families prefer same cellular service providers to get cost
advantages in terms of lower call rates. This segment prefers
closed user group.
Chart 2.2 The segmentation of the mobile customers in India.
Source: India cellular issue 2009
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v) Special: This category includes a small but growing segment which requires largely customized services sought by celebrities, politicians, Chief
Executive Officers. The tailor made schemes for each segment have been a great success so far. This customization, however, has reached such a stage that every service provider has numerous schemes being provided at the same time.
2.6 Market Strategy
The CMSP follow blanket marketing47 as their marketing strategy. Their market promotion consists of offering 50 to 100 minute roughly costing 20-
40 in value for customers who top up within a specified time. These extra minutes have an expiry time of 30 days. The segment of customers like college students who primarily uses voice to make incoming calls and most of their peer communication happens through messages. They use pocket money for top up. The average minutes of usage in India are highest about
400 minutes per month. This roughly translates into Rs. 160 to 200 monthly usages. The free minutes of 50 to 100 minutes for a customer near the average (400 minutes)48, this promotional offer looks very tempting. For customers in the segment with higher monthly usage and nearing exhaustion of their talk time this offer basically gives away value because these users will anyway top up without promotion.
Another example of blanket marketing is caller tunes. Irrespective of the network of the called party the operator provides promotional information before call setup. One way to increase customer life time value is to induce the use of value added services. There is vast amount of information on
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prepaid usage in this space, specifically, people using data services primarily to download images or people using messages to receive information on sports activities. Some sample segmentation that can enable better marketing used by CMSP can be based on the following attributes.
i) Inbound/Outbound call pattern provides insights on people using
multiple SIM cards for same network calls. Voice/text usage
ratio provides information about active texters. Day/Night
patterns provide information on customers who prefer non peak
time access.
ii) Informational data insights on customers frequently seeking
information from call centers. Entertainment data insights on
customers frequently going after recreational services like radio,
music, and tunes. Top up frequency provides insights on
average usage and repetition (booster packs etc).
2.7 Market Research
The cellular mobile service providers (CMSP) use market research agencies to discover the most appropriate service marketing mix. In order to create the right mix, they ensure that the product has the right features for example; it must work well and look good and the price must be right. Making sure that the service is offered when and where they are wanted is an important challenge. The target group needs to be aware of the existence and availability of the product through promotion.
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The CMSP monitor the success of marketing, by tracking the incoming calls received on the call centre. They design advertising, promotion, packaging and branding as per the advice of the market research agencies to increase sales. The informational aspect of advertising involves providing information about products, services, or about important issues. This is very essential for informing the customers about the frequent tariff changes and launch of new services. The persuasive advertising is used by showing a famous personality using the product. The advertising is just one way of promoting a product. A number of ways of promoting products and services are used by Cellular
Mobile Service Provider (CMSP) viz. in store promotion and giving away free trail services.
The Market research agencies also help the CMSP build brand with a unique, consistent and well recognized character. The branding of the mobile service therefore involves projecting and developing this character. The uniqueness is created by CMSP through advertising and packaging. The branding is used extensively by the CMSP to differentiate their services from others.
2.8 Business Model Employed by CMSPs
The business models employed by the cellular mobile service provider
(CMSP) can be divided in to two categories.
2.8.1 One Sided Model
Historically telecom operators sourced infrastructure, mobile and landline, content, spectrum and others things by paying for them, and served their
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consumers with services like communication, entertainment, content, and leased lines. This approach to business is called the one sided model where the telecom operator owns, and controls all its assets to service customers.
The operator makes revenue from consumers and in turn pays to their vendors.
2.8.2 Two Sided Business Model
With the advancement in the software technologies a shift is seen towards application stores, content delivery platforms; rich value added services, and innovations in customer care and billing. It enables counter party transactions between two entities on both sides with the help of platform services. The incentives are aligned in such a way as to unlock inherent platform assets to encourage multi-party transactions to ensure effective utilization of the platform to increase revenues. One side of this transaction is called the upstream customer (employers, sellers), and the other side is called the downstream (employees, buyers). Two sided business model is preferred by cellular mobile service providers (CMSP) to take the advantage of economies of scale.
Chart 2.3: two side’s platform business model.
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Source: http://2.bp.blogspot.com accessed on 23rd Oct 2010
The CMSP in Mumbai are experimenting with a number of models to remain effective and profitable in the market where industry is facing a number of structural changes. The popular models adopted by the CMSP are: i) Subscriber led model: This model was used in the richer economies from where cellular mobile services evolved. Since it was a new technology, the cost of setting up a network was high. In the 1990s, most mobile operators wanted customers who would be willing to pay 40 to 50 per minute. They spent a lot of money attracting high-paying customer.While the cost of setting up the network remained high, very few subscribers signed up because the cost of making or receiving a call remained at 16/- per minutes. ii) Minute Factory Model: In 2001 Minute Factory model a totally home grown model in tune with the latest management theories was promoted by
Bharti Airtel limited which enabled it to change the telecom business. It outsourced network planning and Information Technology (IT) backbone considered core to the mobile service business and converted its fixed costs to variable costs. It targeted millions of pre-paid customers that the
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subscriber-led model didn’t allow. This allowed it to invest a minimum amount to set up a network.
Table 2.1: Comparison between the Minutes Factory and Subscriber model.
SNo Description Minutes Factory Subscriber Model 1. Objective Maximizing per minute Maximizing per subscriber profitability. profit. 2. Focus Relative cost of capacity. Relative cost of customers. 3. Approach Factory or production Marketing perspective make perspective produces or brand and services more sells goods at cheap attractive to the customers. rates. 4. Performance Average revenue, cost Subscriber market share and profit per minute Average revenue per user Average utilization on Cost per subscriber. airtime capacity created. 5. Environment Large markets Small markets fewer Fragmented competitive competitors. structure. Source: own work
The beauty of the Minutes Factory is that it can add small capacities fairly rapidly and economically. The speed comes because each partner is a specialist. The two-sided business model will be suitable for a volume driven market like India where it is possible to achieve the economies of scale.
2.9 Life Cycle of Cellular Mobile Service
The life cycle of mobile service changes over time and must be managed as it moves through its succession of stages; Introduction, Growth, Maturity and
Saturation.
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Table 2.2 the four stages of the life cycle for mobile services.
SNo Stage Year Remarks 1. Introduction 1995 The Call cost was very high, incoming calls were also charged, the busy hour calls were charged at premium rates. Only Two operators were permitted the sales were slow. The CMSP lost their money. 2. Growth 2002 Cost of calls become affordable, economy of scales achieved, competition begins and CMSP started getting return on the investment. 3. Maturity 2006 Cost are lowered as a result of high availability market saturation starts and brand differentiation picked up 4. Saturation 2010 Cost become counter optimal, sales volume stabilizes, profitability depends on the volume the profits go down Source: own work All the mobile service (promotions) in life cycle asserts three things:
i) They have a limited life; they become unattractive when all the cellular mobile service providers (CMSP) offer the same services at similar prices. ii) The sales pass through distinct stages, each posing different challenges, opportunities, and problems. The CMSP offer different prices in different phases. They adopt different resource and strategies in each stage of the life cycle. The concept of the service (product) in the mobile service is little different as compared to the other industry. The tariff plan consists of a number of products. The tariff plans for the Postpaid and Prepaid services are different.
A typical example of the tariff plan is shown below:
Name of the tariff plan: ABC, type of service: Postpaid/Prepaid.
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2.9.1 Voice Calls i) In home network: Rental nil, Outgoing calls-‘a1’ps per minute (different rates for on net and off net calls). The rate of the STD calls ’a2’ and ISD calls ‘a3’ depends upon the destination number called by the customer. The incoming calls from all the destinations are free in the home network. ii) In roaming network: Rental for roaming services- ‘r1’per month or per day,
Outgoing calls-‘b1’ps per minute. The rate of the STD ‘r2’ per minute and ISD calls’r3’ per minute depends upon the destination number called by the customer. All the incoming calls are not free in the roaming network.
2.9.2 Short Message Services i) In home network: Rental nil, Deposit nil, Outgoing calls-‘C1’ps per minute
(different rates for on net and off net SMS), incoming SMS are free. The rate of the outgoing SMS for STD and ISD locations depends upon the delivery destination number where the customer wishes to send the SMS. ii) In roaming network: Outgoing SMS ‘d1’ ps per minute, incoming SMS are free. The rate of the outgoing SMS for STD and ISD locations depends upon the delivery destination number where the customer wishes to send the SMS.
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Table 2.3 the main and supplementary services for CMS.
Sno Main Supplementary services services 1. Voice Local-incoming and outgoing calls, STD-incoming Calls(p1) and outgoing calls, ISD- incoming and outgoing calls. The voice calls are charged in per minute at different rates in the home network and the roaming network. In some tariff plans local minutes are offered free to the customers. No rental or deposit is charged for local calls. A deposit and rental is charged for the postpaid customer 2. SMS(p2) Local-incoming and outgoing, STD-incoming and outgoing, ISD- incoming and outgoing. The SMS are charged on per SMS basis. The SMS are charged at different rates in the home and the roaming networks. In some tariff plans local SMS are offered free to the customers with the rental plans. No rental or deposit is charged .It is charged on unit basis. 3. Data Internet access on the general purpose radio services(p3) standard (GPRS) and enhanced data for global evolution (EDGE) platform. The data services are charged on per kilobyte of data down loaded. A rental is also charged for accessing the service some free data download is allowed in some plans. 4. VAS(p4) The value added services like caller Ring back tone a rental is charged per month and a combination of five or six tunes is allowed. 5. Group A fixed rental is charged for subscribing this product Talk(gt5) an additional amount is charged on addition of members. Source: own work
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2.9.3 Data Services
The Internet access is provided by CMSP either on the GPRS or EDGE platform. The data services are charged on per kb of data down loaded. A rental is also charged for accessing the service.
2.9.4 Value Added Services
The value added services like Caller Ring back tone a rental is charged per month.
2.9.5 Group Talk
A fixed rental is charged for subscribing this product, an additional amount is charged on addition of members. The local calls made on net, off net, other
CMSP, STD and ISD locations are charged at different rates on per minute basis.
The tariff plan for the prepaid services is similar only deposit component is not levied and the call rates are lower as compared to the Post paid services. In some tariff plans CMSP offer free local, STD calls, ISD calls, data services so that customers can try the new services. The total bill is calculated by multiplying the number of SMS used and the rate per SMS.
The total usage is calculated by multiplying the minutes of usage and rate per minute for all types of calls, SMS, Data and Value added services. This revenue is payable by the customer to the cellular mobile service provider
(CMSP). The total of this revenue for all the customers divided by the total number of the customers gives the average revenue per user (ARPU). The total usage in minutes by all customers divided by the total revenue received
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gives average revenue per minute (ARPM). The average life of the tariff plan is eight weeks. On an average about 15 to 18 tariff plans are launched every year. The customers of the old tariff plan are given option to migrate to the new plans. The price for the home and the roaming networks is different. It can be seen that sixty percent of the users like to buy the services at the market value and this percentage increases when the market value reduces.
Chart 2.4 the relation between the asking price and percentage of buyers.
Chart 2.5 the response of the product on time scale.
It can be seen that most of the customers subscribe to the new services in the first three weeks and the response dies after eight weeks. This is the reason why the CMSP are launching tariff plans frequently. The tariffs for new
Postpaid mobile connections in Mumbai include a deposit at the time of registration a non-reimbursable fee for initial connection, monthly rentals, charges for local calls (in excess of free calls), charges for national and international calls.
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2.10 Commercial Launch of Cellular Mobile Service
The Cellular Mobile Service Provider (CMSP) is permitted to launch the service on commercial basis only after it starts commencement of registration.
The customer has to be registered and authenticated at the network point of registration and approved numbering plan shall be applicable for allotting a ten digit number to the customer.
Before commencing the services interconnectivity with Local, National and
International service providers is essential. They have to enter into suitable arrangements with other service providers to negotiate interconnection agreements. The CMSP have to independently provide all emergency and public utility services. The service can be commissioned commercially only after obtaining clearance from licensor after successful completion of interconnection tests.
2.11 Appointment of Sales Channel
The sales channels of the cellular mobile service providers (CMSPs) are organizations involved in the process of retailing mobile service to customers.
The sales channel consists of four tiers. The CMSP sell mobile services to distributors in bulk, who in turn sells it to dealers. The distributors sell the merchandise to a retailer who sells it to the customer through a network of utility shops known as retailers. The sales network is setup before commercial launch of the services.The selection of sales channel is one of the most critical decisions taken by top management of the cellular mobile service
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providers (CMSP). This affects all sales activities such as pricing, advertising and promotions, placement and positioning. The cellular mobile service providers (CMSP) use different channels for retailing postpaid and prepaid services, specialized agents are recruited for each channel. The merchandise in case of mobile services consists of subscriber identity module (SIM) cards, recharge coupons and mobile handsets. In case of prepaid connections there is a Distribution sales executive (DSE) attached to the distributor who is paid by the cellular mobile service provider (CMSPs). On the cellular mobile service providers (CMSP) end, there is a channel manager who controls the sales channel. A sub distributor is appointed between the distributor and retailer in some territories49. The Postpaid connections are sold by cellular mobile service providers (CMSP) owned stores, direct sales agency (DSA), franchise networks and corporate accounts manager. All four channels are directly controlled by the cellular mobile service providers (CMSPs). Similar to prepaid sales here too, the direct sales agency (DSA) will have a direct sales executive (DSE) attached to it. The postpaid connections are activated only after verification of customer’s identity. In case of defaults, the distributors are held responsible for the unpaid bills. This is the main reason why the postpaid connections are not popular. The role of a direct sales executive (DSE) is to organize the merchandise50 at the outlets, take orders for subscribers Identity
Module (SIM) and replenish recharge coupons in the market.
The channel managers are employed by CMSPs to assist the sales manager.
They are responsible for bringing new customers, territory expansion by increasing the number of sales outlets and generate revenue as per targets. A sales team along with their team leader assists the channel manager. They
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are responsible for converting leads by getting them enrolled. The sales report is monitored by cellular mobile service providers (CMSPs) to regulate the supply of products in the market. The retail distribution structure is becoming complex day by day hence a number of software tools (ERP Tally51) are used by distributors and cellular mobile service providers (CMSPs). A number of new retail channels are also evolving such as direct channels52, such as websites and on-net delivery to meet the needs of the Information technology
(IT) savvy customers. The mobile distribution value chain focus mainly on handsets, accessories and recharge coupons but now the demand of content53 also known as valued added services (VAS) is increasing. The value added service (VAS) is sold in the form of recharge coupons through the emerging direct channels as opposed to traditional bricks and mortar54 retail outlets. The content and value added service (VAS) providers have entered the market with digital products, such as games and ring tones. These services are offered from direct channel as part of the retail operations. The sales managers are formulating channel strategies, designing marketing channels, motivating channel members, and managing conflict. A number of new schemes are launched every week to attract the customers.
The distribution channels is the most important for marketing mobile services and are receiving attention from the cellular mobile services providers
(CMSPs). They are not only adding value to products and services, but also creating customer and shareholder value, brand equity and market presence for cellular mobile service providers (CMSP). The channel plays a significant role in the flow of mobile service merchandise. The sales network in the distribution channel also contributes in demand generation, inventory storage,
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and distribution of mobile services, providing credit to buyers, after sales service, product improvement and maintenance. The shifting of channel power from cellular mobile service providers (CMSP) to retailers, wholesalers, and distributors has had a great impact on distribution. In cellular mobile service (CMS) industry the consumer perceives all brands as substitutes for each other this leads to a lower brand loyalty. The distributors and retailers are selling the recharge coupons of all cellular mobile service providers
(CMSPs) operating in Mumbai region. They recommend the product which offers them more sales commission and volume discount. A majority of the customers are using services of more than two cellular mobile service providers (CMSP). This increases the distributor’s power because sales are then determined by what is in stock and most often what is recommended by the distributor and not by what a particular brand offers. In view of this channel relations55 play a very important role in the sales and distribution of the mobile services. It becomes more than just getting products or services from cellular mobile service providers (CMSP) to customer. They assist channel partners by providing infrastructure and sponsoring the local community festivals (Ganesh Chaturthi, Govinda and Navratri) which help in focusing on large customer segments, maximize sales, minimize cost and gain competitive advantage. The customers are looking for superior value and lowest cost. The competition between the cellular mobile service providers
(CMSP) is very stiff; focusing on the channel partner creates sustainable differentiation in delivering superior value to customers.
The channel management is the key in distribution of cellular mobile services.
It helps in managing relationships between the channel managers performing
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distribution functions, which make mobile service available to customers at the right time, right place and at the right price. They play a crucial role in improving relationship with channel partners for effective functioning. They motivate resellers to attain sales targets and provide appropriate support.
The channel managers of all cellular mobile service providers (CMSP) work towards similar goals. In an industry which is facing tough competition, the channel managers of CMSPs are not finding a differentiating factor to sustain channel relations. In such a scenario, investment needs to be made in relationship management. The cellular mobile service providers (CMSPs) are hiring auditors to identify gaps in channel relations. The retailers communicate with customers about the schemes, promotional offers and benefits. They offer the product at right price and serve the customer’s requirements to avoid shortage.
2.12 Monitoring QoS and Security issues
The CMSP shall operate and maintain the network conforming to service quality standards mutually agreed between the CMSP and TRAI. The charges for access or interconnection with other networks shall be based on mutual agreements between the services providers subject to any regulations issued from time to time. In the interests of national security CMSP shall have suitable monitoring equipment for law-full interception by the security agencies. They shall ensure that the Telecom installation carried out by it should not become a safety hazard.
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Chapter -III Literature Review Part-I Study of TRAI Service Quality Standards
3.1 Literature review on Service Quality
3.2 Regulations on QoS for CMS
3.3 Fault Incidence and Repair
3.4 Network Performances
3.5 Billing Complaints
3.6 Customer Perception of CMS
3.7 Review of QoS Benchmark by TRAI
3.8 Response Time for assistance after review
3.9 Customer Perceptions of CMS after review
3.10 Customer Help lines
3.11 Evolution of QoE
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Chapter -III Study of TRAI Service Quality Standards
3.1 Literature Review on Service Quality
The cellular mobile service (CMS) in India is growing exponentially due to liberalization and advancement in technology. There is an urgent need for measurement, survey, analysis and comparison of performance with the benchmarks. This feedback is essential for implementation of business development strategy. It is vital to create procedure that will enable monitoring and act as a source of guideline for the definition, implementation and post- implemental corrections in the telecom policy. It helps to ensure that short and long term growth targets are achieved. The Cellular mobile service (CMS) generates economy wide positive externalities (Roller and Wavermen, 2001).
The success of the policy implementation can only be ascertained after making comparisons with other economies.
In Mumbai region the competition amongst the cellular mobile service provider
(CMSP) is very fierce. They are exploring the business models like CMM56, best practices57, and benchmark58 to improve their performance. They have selected benchmark for achieving the service quality. The same model is adopted by telecom regulatory authority of India (TRAI) also. The main idea behind benchmarking is to compare one’s performance on predefined parameters with others, and find the best practice and use it as a benchmark.
It became a tool for strategic planning, a widely used methodology for
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improving performance both on the micro and macro level. A key challenge for telecom policy makers is to build an information society which promotes globalization. The information society concept influenced telecom policy making, creating a need to define a business development strategy that can focus on reducing the digital divide. The benchmarking becomes complete if three important parameters the digital divide, regulatory reform and economic efficiency are included. It requires periodical surveys and comparison; the effectiveness of its use depends on the indicators and analytical tools applied.
‘The Indicators Handbook’, published by international telecom union (ITU), which defines ‘Key indicators for analyzing the telecom sector is the source of the benchmarking’, in India. The telecom regulatory authority of India (TRAI) relies on ITU E-800 standards.
Benchmarking is named after the surveyor’s mark for the position and elevation; it has become a panacea for business organization looking for better results or efficient business processes (Camp1989). This concept was introduced by Xerox in 1979 to resolve its service quality problems (Kouzmin et al 1999). It has now become one of the best measures of world class performance. There is no single benchmarking process that has been universally adopted. The wide appeal and acceptance of benchmarking has led to the emergence of various benchmarking methodologies. The following steps define how benchmarking is used by the cellular mobile service providers (CMSP).
i) Problem faced by customers is listed: the customers complaints
are listed like poor network coverage, billing complaints, unsatisfactory
response from the call centers, and non availability of self service. The
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research technique like informal conversations with customers,
employees, or suppliers; exploratory research techniques such as
focus groups; or in-depth marketing research etc,
ii) Other industries having similar processes are identified: All the
cellular mobile service providers (CMSP), Basic service Operators and
Internet Service Providers are listed who are achieving service quality
parameters.
iii) Leaders in cellular mobile service are identified: The cellular
mobile service providers (CMSP) having the best service in India and
abroad are selected by telecom regulatory authority of India (TRAI).The
parameters are finalized after consulting all stake holders.
iv) Survey companies for measures and practices: The telecom
regulatory authority of India (TRAI) conducts quarterly surveys to
gauge the performance of the cellular mobile service (CMS).
v) Identify leading edge practices: the cellular mobile service
providers use the survey data to identify the best practices and
benchmark the values.
vi) Implement new and improved business practices: The billing
plans and customer service activities appreciated by the customers are
adopted by all the cellular mobile service providers to meet the bench
mark.
There are a number of benchmarking techniques, the three of them performance benchmarking, product benchmarking and operational benchmarking are employed by CMSP. The benchmarking involves time and money. The benchmarks are finalized after running a data analysis program.
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3.2 Regulation on Quality of Service for Cellular Mobile Services
In exercise of its functions the telecom regulatory authority of India (TRAI) Act, notified the “Regulation on Quality of Services (QoS) of Cellular Mobile
Telephone Services, 2000” vide Notification dated 5th of July, 2000. This was the first regulation on QoS. The Section 11 (1) (b) (v) of the above act mandates the authority to lay down the standards on quality of service (QoS) to be provided and ensure the quality of service and conduct the periodical survey of such service provided by the cellular mobile service provider
(CMSP) to protect customers interest. The main focus areas were:
i)Create conditions for customer satisfaction by making known the
quality of service which the service provider is required to provide and
the user has a right to expect;
ii)measure the Quality of Service(QoS) provided by the Cellular Mobile
Service Providers(CMSP) from time to time and to compare them with
the norms so as to assess the level of performance; and
iii) To generally protect the interests of consumers of telecom services.
The benchmarks in the above regulation were finalized after extensive consultation with the cellular operators association of India (COAI). The benchmarks were included in the license terms and conditions. The performance of cellular mobile service provider (CMSP) was below the prescribed benchmarks. The benchmarks for quality of service (QoS) parameters were to be achieved in three stages viz. (i) in the short term
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before the end of 12 months, (ii) in the intermediate term before the end of 24 months; and (iii) in the long term of 36 months.
The TRAI quality of service (QoS) parameters is divided in four categories viz.
i) Fault incidence and repair;
ii) Network performance;
iii) Billing complaints and
iv) Customer perception of services.
The telecom regulatory authority of India (TRAI) uses international telecom union (ITU)-T recommendations E-800 to define Quality of service as the collective effort of service performance, which determines the degree of satisfaction of all services. It further expands upon the customer emphasis by identifying four parameters of quality.
i) Service support performance is the ability of the cellular mobile
service provider (CMSP) to provide service and maintain it.
ii) Service portability performance is user friendliness, simplicity, and
ease of use.
iii) Service integrity performance is performance to established
performance criteria.
iv) Severability performance is accessibility; retain ability and reliability,
signifying availability of the service to customer on request and ability
to provide it without interruption.
In the given competitive environment, TRAI places considerable emphasis on network performance aspects, as distinct from service management aspects, in its quality of service parameters.
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The Service quality monitoring by telecom regulatory authority of India (TRAI) is having encouraging effects on the growth of the cellular mobile service provider (CMSP) in Mumbai. The quality of service (QoS) monitoring requires that measurements be made and, sometimes, that targets be attained. In prima facie cellular mobile service providers (CMSP) make measurements for themselves, action by telecom regulatory authority of India (TRAI) seems unnecessary. The telecom authority regulatory authority of India (TRAI) monitors the quality of service quality for several reasons. Some are more important when competition is strong, and others are more important when competition is weak. The Quality of service (QoS) monitoring by regulators is having the following objectives
i) Helping customers to make informed choices and verifying claims
made by cellular mobile service providers (CMSP).
ii) Understand market behavior.
iii) Maintaining or improving quality in the presence and absence of
competition.
iv) Helping operators to achieve fair competition.
v) Making interconnected networks of different operators work well
together.
3.2.1 Benchmark for Cellular Mobile Services
The benchmark for cellular service prescribed in the regulation were based on memorandum of understanding signed between the department of telecommunications (DoT) and the Cellular mobile service providers (CMSP) offering GSM services. The voice quality in cellular mobile services (CMS) is
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measured on a scale from 0 to 7. As the quality deteriorates, the value increases. The quality if this value remains less than or equal to 4 is considered good. The network quality performance parameters like the call success rate within the licensee’s own network, service access delay, call drop rate and the voice quality are the parameters which are directly related to the service quality that is available to the customer. These shall be measured on sample basis during the Time Consistent Bust Hour (TCBH). The group access delay consists of the following:
i) The time to connect the call: this is the time between the pressing the
send button and getting the ring back tone. This should not exceed four
seconds.
ii) The time to confirm instructions to connect: this is the maximum time
from initiating the call setup command to when it is acknowledged to
the user.
iii) The time to release the call: The maximum time for initiating the
disconnect command to when this command is passed on to the called
network. The bench mark was fixed less than 2 seconds.
iv) Time to alert mobile handset: the maximum time the public land line
mobile network (PLMN) receives a call for the mobile handset to when
the alert is energized. This time period is 4-15 seconds depending
upon the number of page attempts. The benchmark was fixed between
9-20 seconds.
v) Call success rate: this is defined, as the probability that a call
attempt made from the mobile set within the coverage in 90% of the
case will be successfully signaled to the network within the specified
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time. It does not refer to the performance of the called network, and
does not include the congestion on the air performance.
vi) Call drop rate: it is defined as ratio of the calls lost after
establishment to all established calls. This shall include calls dropped
due to the failure of handover, radio loss and network congestion.
vii) Accumulated down time of community isolation includes failure of
the entire exchange area due to the switch failure, BTS failure or trunk
failure. The benchmark was less than 24 hrs.
viii) Hand over means the action of switching the call in progress from
one radio channel to another and is used to allow established calls to
continue by switching them to another radio source when the mobile
station moves from one base Transceiver station (BTS) to another.
3.3 Fault Incidence and Repair
It consists of three benchmarks listed in the table below the values for short term, intermediate and long term is different. The measurement is done for a period of one quarter and average is calculated. The survey was done by an independent agency.
Table 3.1 Fault incidence and repair bench marks for CMS.
SNo Parameter Short term Intermediate Long term
1. Faults per 100 < 3 < 2 < 1 Customer/ month 2. Faults cleared in > 98% > 99% 100% 24hrs 3. Accumulated down < 24 hrs < 24 hrs < 24hrs time of isolation. Source: TRAI benchmark on QoS.
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3.4 Network Performance
It consists of three benchmarks listed in the table; values for short term, intermediate and long term are different.
Table 3.2 The Network Performance benchmarks for CMS.
Sno Parameter Short term Intermediate Long term
1 Call success rate > 98% > 98% >99% 2 Service access <= 15 sec <= 15 sec <=15 sec delay (avg. of 100 calls) 3 Call drop rate < 4 % < 3.5% < 3% 4 % connections > 90% > 92% > 95% with good voice quality Source: TRAI benchmark on QoS.
The measurement is done for a period of one quarter and average is calculated. The survey was done by an independent agency appointed by telecom regulatory authority of India (TRAI).
3.5 Billing Complaints
It consists of three benchmarks listed in the table below the values for short term, intermediate and long term is different. The measurement is done for a period of one quarter and average is calculated. The survey was done by an
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independent agency appointed by telecom regulatory authority of India
(TRAI).
Table 3.3 the Billing benchmark for Cellular Mobile Service. Sno Parameter Short term Intermediate Long term
1. Billing complaints < 0.2% < 0.15% < 0.10% per 100 bills issued 2. Percentage Billing > 99% 100% 100% complaints resolved within 4 weeks. 3. Period of all < 6 weeks < 5 weeks < 4 weeks refunds Source: TRAI benchmark on QoS. 3.6 Customer Perception of Cellular Mobile Service
It consists of seven benchmarks listed in the table below the different values for short term, intermediate and long term is given. The measurement is done for a period of one quarter and average is calculated.
Table 3.4 the customer perception of services for CMS.
Sno Parameter Short Intermediate Long term term
1. Percentage satisfied with > 80% > 90% > 95% provision of service. 2. Percentage satisfied with > 80% > 85% > 90% the billing performance. 3. Percentage satisfied with > 80% > 85% > 90% the help services. 4. Percentage satisfied with >85% > 90% > 95% the network performance, reliability and availability. 5. Percentage satisfied with > 85% > 90% > 95% the maintainability 6. Overall Customer > 80% > 85% > 95% satisfaction. 7. Satisfaction with Offered > 80% > 85% >95% supplementary services. Source: TRAI benchmark on QoS.
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3.7 Review of QoS Benchmark by TRAI.
In 2002 code division multiple access (CDMA) wireless technology was adopted by CMSPs in a big way in India. Hence it was decided by telecom regulatory authority of India (TRAI) that the existing quality of service (QoS) bench marks applicable for GSM will be applicable to CDMA also.
The telecom regulatory authority of India (TRAI) also decided to review the benchmarks due to new developments in telecom industry. On 28th Oct 2004, it held a meeting with CMSPS. In this meeting the issues relating to non- compliance of the benchmark were discussed. In order to make the process more purposeful some of the existing benchmarks were deleted and some new were added. The new benchmarks were added in the network operational performance and customer perception category. The benchmarking followed by the cellular mobile service providers (CMSP) in
Malaysia, Singapore and Austria were also consulted. The benchmarks agreed by all the stake holders were approved and came to be known as
Regulation on quality of service for CMS 2005.
3.7.1 Fault Incidence
In case of cellular mobile service (CMS), the mobile handset is purchased and owned by the subscriber and it is his responsibility to maintain it. Hence, these parameters were found irrelevant and were dropped. The serial number i) and ii) of the table number 3.1 were deleted. The iii) parameter was continued as added to the Network performance.
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Table 3.1 (a) Fault incidence and repair benchmarks for CMS.
Sno Parameter Benchmark 1. Fault incidence < 1 Deleted (Faults per 100 Customer/ month) 2. Faults cleared within 24hrs 100% Deleted 3. Accumulated down < 24hrs Moved to time of community isolation Network performanc e Table 6.2 Source: TRAI benchmark on QoS.
3.7.2 Network Performance
The benchmark at serial number i) was deleted as it was reported in survey that Call Success Rate is a widely misunderstood and poorly measured parameter. It did not provide any valid measure pertaining to the network that might have an impact on the subscribers’ satisfaction.
3.7.2.1 Call set up Success Rate.
Instead of Call success rate a new benchmark Call Set up Success Rate
(CSSR) was included; it was calculated by dividing the ratio of established calls to attempts made. The established Calls meant that, the traffic channel
(TCH) is allocated and the call is routed to the outward main Switching centre
(MSC).Thus this included complete signaling in the call setup process and does not aim to measure the performance of the called exchange. The measurement is to be done using operation and maintenance centre (OMC) generated data only in Time Consistent Busy Hour for all days of week.
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3.7.2.2 Service Access Delay
It comprises of the following:
i) Time to connect Call: time between pressing the send button and
getting ring back tone. This should not exceed four seconds.
ii) Time to confirm instruction to connect: this is the maximum time from
imitating the call setup command to when this is a acknowledged to the
user.
iii)Time to release the call the time from initiating the disconnect
command to when it is passed on to the network. This should not
exceed 2 seconds.
iv) Time to alert the mobile set: the maximum time from when the
PLMN receives a call for a mobile set to when it is energized. This time
period is 4-15 seconds depending upon the number of the page
attempt.
3.7.2.3 Blocked Call Rate.
The Blocked Call Rate a new benchmark was introduced as the occasion where there is no free channel to serve a call attempt. Hence this parameter represents congestion in the network. The congestion can be at Stand alone dedicated control channel (SDCCH) level or traffic channel (TCH) level. This objective parameter is an accepted engineering level for determining the hardware and software requirements in any network at TCH for all days.
3.7.2.4 Dropped Call Rate
The Dropped call was an existing parameter means where connection succeeds but is disconnected due to the abnormal call release. This is measured as the ratio of the total attempts to the calls dropped /hundred calls.
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3.7.2.5 Service Coverage Added After Review
System drive tests shall be conducted at least once a quarterly to check the network performance of the whole city in the following manner
i) Indoor locations – at least 10 location per quarter, one residential and
one residential and one commercial each from North, South, East,
West and Central zone of the town;
ii) Outdoor locations all major routes in city (main roads and some of
the other lanes) covering all the BTS sites in that city;
iii)Highway drive also cover at least a 10 Kms distance starting from
the out skirts of the city in all the highways connecting the town to other
cities;
iv) The cellular mobile service provider (CMSP) must also cover the
entire Blackout areas identified in the previous quarter drive.
v) Each area where the tests are conducted should cover not less than
200 km or 5 hours driving time. The minimum sample size shall be 100
test calls.
3.7.2.6 Point of Interconnect Congestion added after Review
It means that out of 200 calls between the operators only one call shall face congestion. This is seldom achieved by the operators as the network of all the operators is growing.
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Table 3.2 (a) The Network Performance benchmarks for CMS.
Sno Parameter Long term Remarks
1. Accumulated down time < 24 hrs Moved from Table 6.1(a) 2. Call setup success rate > 95% Added 3. Service access delay <= 15 sec Retained (avg. of 100 calls) 4. Blocked Call Rate (i)SDCCH Added Congestion <0.5 %. (ii)TCH congestion < 2 % . 5. Call drop rate Less than 3% Retained 6. %Connections with More than 95% Retained good voice quality 7. Service coverage Indoor >=-75dbm, in Added. vehicle >=-85dbm and outdoor >=- 95dbm. 8. PoI congestion < 0.5% Added. Source: TRAI benchmark on QoS.
3.7.2.8. Billing Benchmarks
The billing benchmark were not changed and retained as it is.
Table 3.5 the Billing Complaint benchmark for CMS.
Sno Parameter Short term Intermediate Long term
1. Billing less than less than less than complaints per 0.2% 0.15% 0.10% 100 bills issued 2. Percentage More than 100% 100% Billing 99% complaints resolved in 4wk. 3. Period of all Less than 6 Less than 5 Less than refunds weeks weeks 4 weeks Source: TRAI benchmark on QoS.
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3.8 Response Time for assistance after Review
As the CMSP are not having the sufficient number of positions at the call centre the customers have to try again and again for assistance. Hence, it is felt necessary to introduce a parameter, which reflects the speed in which a call is answered either by the operator or by the Interactive Voice Response system provided by the service provider.
3.9 Customer Perception of Cellular Mobile Service after Review
All the existing parameter of the table 3.4 was retained and a new category of parameters Response Time to the customer for assistance were introduced.
Table 3.4 (a) Fault incidence and repair parameters for CMS.
Sno Parameter Bench Remarks mark 1. % satisfied with provision of service. >95% Retained 2. % satisfied with the billing performance. > 90% Retained 3. % satisfied with the help services. > 90% Retained 4. %satisfied with the network >95% Retained performance, reliability and availability. 5. % satisfied with the maintainability >95% Retained 6. Overall customer satisfaction. >95% Retained 7. Customer satisfaction with > 95% Retained Offered supplementary services. Source: TRAI benchmark on QoS.
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3.10 Customer Help Lines
Table 3.6 Response of Call centre operators on help line Sno Customer help lines Remark 1. Response time to the customer assistance Added (averaged over one month) 2. a) Percentage of calls answered electronically i)with in 20 sec should be 80% ii)with in 40 sec should be 95% 3. b) Percentage of calls answered by operator (voice to voice) i) with in 60sec 80% ii)with in 90sec 95% Source: TRAI benchmark on QoS. In order to add transparency and protect the interest of the subscribers of the mobile service, the TRAI has started a quarterly audit of the QOS from July
2010 before this the data was submitted by the CMSP quarterly and the audit of the QoS was done annually by the regulator to verify the QoS. In
February 2010 TRAI also directed all the CMSP to publish the performance with respect to the TRAI Bench mark of QoS on their website on quarterly basis. All the CMSP have to display this within 45 days after the end of the every quarter.
3.11 Evolution of Quality of Experience (QoE)
The service quality is the ability of the cellular mobile service (CMS) network to provide a service with an assured service level; basically it is intrinsically a technical concept. The TRAI model of service quality focuses on four main parameters fault incidence and repair, network performance, billing
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complaints and customer perception of services. The first three parameters are purely technical they are measured, expressed and understood in terms of networks and network elements, which usually has little meaning to customers. The fourth parameter the customer perception of services measures the customer satisfaction and call centre performance. The benchmark for the perception of the customer services fixed by TRAI in percentage seems to be very general. A number of factors such as price, reliability, availability, usability and utility are not included in the customer perception.
The concept of end-to-end service quality according to ITU-T is the degree of satisfaction of a customer using the service. In the course of time, however, the dominating research perspective on service quality has become more and more a technical one, focusing on monitoring and improving network performance parameters like packet loss rate, delay or jitter. The end users usually are not bothered at all about technical performance; what they really care about is the experience they are able to obtain.
The cellular mobile service providers (CMSP) are experiencing that customer satisfaction depends upon the perceptions of the customer and there is a need to include all the parameters which influence the perceptions of the customers. The quality of a network and the services it offers is how customers perceive performance. This parameter is not at all included in the
TRAI QoS regulation.
A paradigm shift in service quality is noticed in the industry. While the prior grand challenges of QoS research have begun to disappear from the research agenda, e.g. due to large-scale over provisioning in today’s core networks, a
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counter movement has started to become visible, with the aim of interpreting end-to-end quality in the proper sense of regarding the user as the end of the communication chain.
As a result, the notion of Quality of Experience (QoE, abbreviated also as
QoX) has appeared, describing quality as perceived by the user instead of as captured by network parameters. The Quality of Experience (QoE) is the term used to describe this perception and how usable the customers think the services are makes a difference.
It promotes a holistic understanding of quality, as it aims to address all technical and non-technical parameters that contribute to the user experience of networked services. With the growth of mobile services, it has become very important for CMSP to measure the quality of experience (QoE) of its network accurately and improve it further to achieve customer loyalty and maintain competitive edge.
A poor QoE will result in unsatisfied customers, leading to a poor market perception and ultimately, brand dilution. It is not a metric but a concept comprising all the elements of a customer’s perception of the network and its performance and how they meet expectations. There are several factors that interact to determine QoE, including price, reliability, availability, usability, utility and fidelity. If a high experience is delivered to the customer then the user is happy and satisfied. A low quality experience indicates that the user does not have a good experience of the network. The concept applies to all the interaction between cellular mobile service providers (CMSP) and the customer. The experiences are created by the front line staff through a subjective process.
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The Quality of Experience is a subjective measure from the user’s perspective of the overall value of the service provided, and thus does not replace, but augment end-to-end QoS by providing the quantitative link to user perception.
As such, it extends the current QoS perspective described above towards the actual end user, including technical QoS as well as the expectations of the end users, the content of the service, the importance of service for the end user, the characteristics of the device, the usability of the human-computer interfaces, the joyfulness of interaction, the perception of security, and maybe even the price of the service, to name but a few new ingredients.
The QoS is a subset of the QoE. Although a better network QoS in many cases will result in better QoE, fulfilling all traffic QoS parameters will not guarantee a satisfied user. An excellent throughput in one part of a network might not help if there is no coverage a short distance away.
The QoE is how a user perceives the usability of a service when in use how satisfied he or she is using a service. The term QoE refers to the perception of the user about the quality of a particular service or network. These statistics tell CMSP very little about the level of customer satisfaction flawless transmission of garbled packets does not make for happy users. So to infer that QoE is improved because QoS mechanisms are used to reduce jitter or average packet delivery delay may not be accurate in all circumstances. The goal of QoS should be to deliver a high QoE. The overall QoE for a user depends on how well the operator organizes the entire value chain as seen by the user. It comprises of the following
i) Mobile content providers, the content originators, websites, WAP
sites, games, video, audio, portals etc.
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ii) Service & network providers, the mobile operators and mobile ISPs, which are often owned by the operators themselves and transmit the content to the user. iii) User device and application software that enables the user to experience the content. iv)The network infrastructure providers and system integrators, although not seen by the user, enable the above three components in the value chain. The Mobile operator is in the middle of this chain and organizes these components in order to provide an overall experience to the user.
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Chapter –IV Literature Review Part-II Study of Customers’ Expectations
4.1 Literature Review on Customer Service
4.2 Growth of the Service Sector in India
4.3 Service Triangle of Marketing
4.4 Evolution of Service Quality
4.5 SERVQUAL Scale
4.6 Customer Service Studies in Telecom
4.7 Customers’ Expectations from CMSP
4.8 Customers’ Perception of CMS
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Chapter –IV Study of Customers’ Expectations
4.1 Literature Review on Customer Service
Service is a form of attitude which influences customer satisfaction it also leads to consumer loyalty (Johnson and Sirikit, 2002) and future purchase. It provides time, place, form or psychological utilitarian benefits. The service is deeds, processes and performances and is intangible in nature. In case of mobile service, the core offerings consist of primary deeds making available the radio frequency network. It is impossible to define services in isolation. It is intangible but produces tangible results. It acts like a facilitator for the core product59. The customer service is the service provided in support of core products. It includes provision of service to customers before, during and after a purchase. It is normally an integral part of customer value proposition. It is a series of activities designed to enhance the level of customer satisfaction that is, the feeling that a product or service has met the customer expectation
(Jamier L Scott 2002). It may be offered by a person or machine. If the service is offered by an automated means it is called self-service60.
The customer service plays an important role in an organization’s ability to generate revenue. It is included as a part of an overall approach to customer satisfaction and loyalty. For mobile service it includes answering queries, taking orders, dealing with billing issues, handling complaints and perhaps assistance in using the value added services61. The customer service in mobile telecom industry can happen either on-site62 or via internet. The
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cellular mobile service providers (CMSPs) operate customer service from call centers63 and sales outlets64. The customer services like activation, billing information and tariff details are provided free. The retail sale outlets and stores assist the customers in refilling their prepaid accounts. Today, with information technology easily available to all cellular mobile service providers
(CMSP); there is cut throat competition in the market. The differentiations in mobile services product attributes have started blurring. The customer service has become the main differentiator.
The cellular mobile service provider (CMSP) started with the voice and short message services (SMS) to satisfy the core needs of the customers. As the competition increased, they jumped to the next level by including branding, styling, color etc to make their offer distinctive to impress the customers. In the next stage, they started very attractive customized tariff plans; value added services and free Subscriber Identity Module (SIM) cards bundled with the handsets65. As there is no copy right protection the tariff and services offered by one cellular mobile service provider (CMSP) are immediately copied by the others. Thus, it can be seen that, in mobile service industry, the intangible part66 of the product has become the main differentiator.
4.2 Growth of Service Sector in India
The service sector has grown by leaps and bounds due to consumerism, changing demographics and lifestyles. Mainly two business models67 are prevalent in the Indian service sector. First the Industrial management model, which focuses on revenues and operating costs, which ignores the role played
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by human resources in generating customer satisfaction and profits. This model is a hangover of manufacturing industry. In this model factors that bring revenue are advertising, sales promotions, accessibility, distribution and location advantage. This model is not preferred by cellular mobile service providers (CMSPs).
The second model which focuses on the service delivery is adopted by cellular mobile service providers (CMSPs). It proposes that the firms should be supportive of those personnel who interact with the customer; more emphasis is given to front line employees. They are provided modern equipments, office space, moral support and motivation initiatives. This model is based on the service triangle framework, which depicts the relationships among three entities of service organizations service strategy, systems embedded in the organization and people. The customer remains in constant interaction with these three groups.
The service strategy is reflected by the policies, mission and strategy of the organization. It is communicated to customers and its employees. The
Information technology systems are designed depending on the service strategies of the organization. The interactions between the customers and the service providers are called moments of truth or encounters68. While the service strategy is the root strength of the cellular mobile service providers
(CMSP), the people and system are responsible for the encounter, which goes on to progressively effect service quality, image, customer loyalty, value creation and profitability (Chattaranjan Bhattacharjee).
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4.3 Service Triangle of Marketing
The services are a game of promise marketing. The service triangle of marketing is a powerful model and gives insight into management and service dynamics. The service marketing is a game of promises played amongst three entities cellular mobile service provider (CMSP), customer and service provider69.
Three different types of marketing take place during service transaction.
i) The cellular mobile service provider (CMSP) does external
marketing. It promises benefits, explains features and assures
satisfaction by way of advertisement, public relation and other forms of
communications. It uses the mass media to convey its promises. The
company makes promises to the customers.
ii) The cellular mobile service provider (CMSP) does internal marketing
to its providers. It has to provide working space like office, equipments,
computers, and telephones to its provider. It also has to recruit, select
and train appropriate employees, channel partners, franchisees. It
enables them to perform service transactions and honor promises.
iii) The CMSP do interactive marketing with the customer. Both the
customer as well as provider gets instant feedback about each other
during service transaction. This transaction reflects the perception of
the quality of the customer service (QoCS). The provider keeps the
promises made by the company to the customers. In the game of
promises in service transaction the following happens:
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i) The cellular mobile service provider (CMSP) makes promises to the
customers by offering attractive tariff plans and new services.
ii) The cellular mobile service provider (CMSP) enables the providers to
complete the service transaction. The services are offered through
customizing the Customer Resource Modules 70(CRM) and the billing
servers.
iii) The provider keeps the promises made by the cellular mobile
service provider.
An important implication of the triangle model is the key to achieving sustainable competitive advantage in today’s market in serving customers in excellent fashion rather than merely selling to them (A Parasuraman). There are three entities in customer service marketing, each crucial to the quality if the total experience of the service product is bound to each other. The
CMSPs proposes to offer new service and communicates with the customers by making promises. Simultaneously, it trains the provider convinces them, and enable them to keep the promises. The providers finally have on themselves the gigantic responsibility of conveying to the customers, the sincerity of purpose and the validity of the promises that was supposed to be kept. The service providers’ image is entirely dependent on the quality of the providers and on how they convey their impression to the customers.
The cellular mobile service providers (CMSPs) objective is to develop and provide service offerings that satisfy customer needs and expectations thereby ensuring their survival. They have to reduce the gap between customer’s expectations and perceptions. To achieve these objectives they have to understand the customers’ behavior.
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The customers are finding difficulty in evaluating and choosing because a large part of the mobile services are intangible and non-standardized and consumption is closely intertwined with production. They participate to a greater extent in the definition of mobile services. They feel more responsible for their dissatisfaction when the service do not meet their expectations. The consumers are more loyal to the brand as the cost of changing brands, the availability of substitutes, the risks associated with the purchase and the degree to which they may obtain satisfaction.
4.4 Evolution of Service Quality
The consumers prefer service quality (SQ) when the price and other cost elements are held constant (Boyer and Hult, 2005). It has become a distinct and important aspect of the product and service offering (Wal et al., 2002).
According to Leisen and Vance (2001), service quality (SQ) helps to create competitive advantage by being an effective differentiating factor. The service quality (SQ) was initiated in the 1980s as the world wide trend when marketers realized that only a quality product can guarantee to maintain competitive advantage (Wal et al., 2002). The competitive advantage is a value creating strategy, simultaneously which is not implemented by any existing or potential competitors (Barney, 1991). Moreover, according to them, a competitive advantage is sustained when other companies are unable to duplicate the benefits of this strategy.
According to Wang and Lo (2002) the quality of customer service depends on service attributes. They also mentioned that there are two dimensions for
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quality. The first, fitness of use, which refers to service that is supposed to do and possess features to meet the customer needs. The second one is reliability, which represents the product that is free from deficiencies.
Accordingly, it is important for a company to understand how customers perceive service quality. Rust and Oliver (1994) pointed out that companies need to measure customer satisfaction with their services. The service quality is in the mind of the customer. So it is necessary for Cellular Mobile Service
Providers (CSMP) to remain in touch with consumers for measuring service quality. It reflects the extent to which a product or service meets or exceeds customers expectations (Wal et al., 2002).
There are two perspectives of service quality (SQ) one which is implemented in production of services such as zero defect or meeting defined bench marks called internal perspective. The other one called external perspective which encompasses customer perception, expectation, satisfaction, attitude and delight. The external perspective is the focus of this study. The external perspective is gaining importance in the light of increasing consumer awareness, changing tastes and increasing expectations of the mobile customers.
The service quality is defined by a number of scholars, the definition; given by
(Parasuraman, Zeithamal and Berry, 1985) has been accepted by researchers examining service quality issues. They define service quality
(SQ) as the degree and direction of discrepancy between consumer’s perceptions and expectations in terms of different but relatively important dimensions of the service quality, which can affect their future behavior. Its measurement is done along a continuum ranging from ideal quality to totally
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unacceptable quality with some point along the continuum representing satisfactory quality. The position of a customer perception of service quality
(SQ) on the continuum depends on the nature of discrepancy between the expected service and the service perceived by the consumer. When the expected service is more than the actual service, service quality is less than satisfactory. It will move towards totally unacceptable quality as the negative discrepancy between expected and perceived service increases. When expected service is less than perceived service, perceived service quality is more than satisfactory and will tend towards ideal quality with increased positive discrepancy between expected and perceived service. In this situation, when expected service is equal to perceived service, service quality is satisfactory. Service quality (SQ) is thus operational as performance (P) minus-expectations (E) computed disconfirmation to provide a formula to service providers for assessing and managing their service quality levels by working on two important parameters of customer perceptions (P) and expectations (E). According to this perspective, the way to maximize the quality is to maximize the difference between these measures, ‘P’ and “E’ i.e. to maximize the difference between these measures, ‘P’ and ‘E’ i.e. to exceed the customer expectations.
Measuring the quality of a service is a challenge for cellular mobile service providers (CMSPs). The mobile service has numerous intangible or qualitative specifications. In this context, different models of service quality gain specific importance as they not only help in learning the factors associated with service quality, but also provide a direction for improvements. As a way of trying to measure service quality many models have been developed such as
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the perceived quality model (Gronroos, 1982), the Kano model (Kano, 1984),
RATER (Zeithaml, 1990), SERVPERF (Cronin & Taylor, 1992), the GAP model (Parasuraman, Zeithaml & Bitner, 1996), SERPVAL (Lages &
Fernandes, 2005) and the most well-known one, SERVQUAL (Parasuraman,
Zeithaml &Berry, 1988).
It is suggested by many researchers that quality results from a comparison of perceived performance with expected performance (Kang, 2006). Indeed, this notion was the basis of the SERVQUAL model, which views service quality as the gap between the expected level of service and customer perceptions of the level received (Parasuraman et al., 1988).
The cellular mobile service providers (CMSP) are facing problems in understanding the antecedents of service quality (SQ) which play major role in determining the service quality. On the basis of previous researches conducted in the mobile service sector, it was found that service quality (SQ) plays major role in affecting the perceptions of customers about the quality of service offered by the service organizations. This accrues overtime period because of the various service encounters between service providers and service consumers.
In order to maintain customer loyalty and profitability it is essential to maintaining satisfactory service quality (Zeithaml, 2000; Leisen and Vance,
2001). Conversely, Johnson and Sirikit (2002) stated that service delivery systems have the ability to allow managers to identify the real customer feedback and satisfaction on their telecom service. Since, quality reflects the customers’ expectations about a product or service. Lovelock (1996) stated that this customer driven quality replaced the traditional marketing
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philosophies which was based on products and process. Service quality is different from the quality of goods. Since, services are intangible, perishable, produced and consumed simultaneously and heterogeneous (Zeithaml and
Bitner, 2000).It is a major challenge for the cellular mobile service providers
(CMSP) to deliver quality service consistently. In the mobile service industry customers perceive service quality in terms of six main criteria like; professionalism, attitudes and behavior, accessibility and flexibility, reliability and trustworthiness, recovery, reputation and credibility (Christian, Gronroos,
1988). The above six main criteria are based on the generic characteristics of services like; intangibility, inseparability, perish ability and heterogeneity on which a, conceptual model of service was developed. This model is about the perception and expectation aspects of the service quality and the experience of the customers with the services was found quite relevant in assessing the quality of the service in the service environments. They pointed out the factors responsible for expectations of the customers. These factors were market communication, image, word-of-mouth and customer needs.
4.5 SERVQUAL Scale
Many scholars agree that service quality can be decomposed into two major dimensions (Gronroos, 1983; Lehtinen and Lehtinen, 1982). The first dimension is concerned with what the service delivers and is referred to by
Parasuraman, Zeithaml and Berry (1985) as outcome quality and by Gronroos
(1984) as technical quality. The second dimension is concerned with how the service is delivered: the process that the customer went through to get to the
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outcome of the service. Parasuraman, Zeithaml and Berry (1985) refer to this as process quality while Gronroos (1984) calls it functional quality. However, while Parasuraman, Zeithaml &Berry (1985) and Parasuraman and Zeithaml
(2006) confirmed these distinctions, they often confusingly use service quality when they mean service process quality. Thus to avoid any further confusion a distinction was made between service process and service outcome.
Whenever the word service is used, it is taken as the total service which is a combination of process and outcome. Likewise, service quality shall be used to refer to the totality of process quality and outcome quality. Parasuraman and Zeithaml define service quality as the degree and direction of discrepancy between customer’s service perceptions and expectations (2006). Realizing that there was not enough literature to produce a rigorous understanding of service quality and its determinants, Parasuraman, Zeithaml and Berry (1985) conducted an exploratory investigation to formally delineate service quality.
Their investigation was composed of interviews with executives from four types of service businesses (i.e. retail banking, credit card, securities brokerage, and production repair and maintenance) as well as a number of focus groups composed of individuals who have recently received services from those businesses. One of the results of this investigation was the identification of ten determinants of service process quality. Parasuraman,
Zeithaml and Berry (1985) listed them as follows:
i) Reliability involves consistency of performance and dependability.
ii) Responsiveness concerns the willingness or readiness of employees
to provide service.
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iii) Competence means possession of the required skills and
knowledge to perform the service.
iv) Access involves approachability and ease of contact.
v) Courtesy involves politeness, respect, consideration, and
friendliness of contact personnel (including receptionists, telephone
operators, etc.).
vi) Communication means keeping customers informed in language
they can understand and listening to them. It may mean that the
company has to adjust its language for different consumers increasing
the level of sophistication with a well-educated customer and speaking
simply and plainly with a novice.
vii) Credibility involves trustworthiness, believability, honesty. It
involves having the customer’s best interests at heart.
viii) Security is the freedom from danger, risk, or doubt.
ix) Understanding customer involves making the effort to understand
the customer’s needs.
x) Tangibles include the physical evidence of the service.
Parasuraman, Zeithaml and Berry (1988) developed the SERVQUAL scale using the qualitative research based on service quality data spread over five different categories of services appliance repair and maintenance, retail banking, long distance telephone, securities brokerage, and credit cards in their article “SERVQUAL: A Multiple-Item Scale for Measuring Customer
Perceptions of Service Quality.” which was pioneer in its field as it didn’t depend on the earlier dimension of goods quality in the manufacturing sector.
The initial study based on the focus groups results in ten dimensions of
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service quality that included tangibles, reliability, responsiveness, competence, courtesy, credibility, security, access, communication, and understanding the customer. On further purification, a twenty two item scale, called SERVQUAL which would measure the service quality based on five major dimensions, viz. tangibles, reliability, responsiveness, assurance and empathy was derived. The authors defined service quality as the degree of disagreement between customers’ expectations for the service and their perceptions of the service performance.
In a later paper, Parasuraman, Zeithaml and Berry (1988) found certain overlaps among the dimensions and shortened the list into five dimensions.
This new list retained tangibles, reliability, and responsiveness while competence, courtesy, credibility, and security were combined into a new dimension called assurance. Access, communication, and understanding the customer, on the other hand, were placed under a common dimension called empathy. The five dimensions were agreed. They are as follows:
i) Assurance - Knowledge and courtesy of employees and their ability
to inspire trust and confidence.
ii) Empathy - Caring, individualized attention the firm provides its
customers.
iii) Reliability - Ability to perform the promised service dependably and
accurately.
iv) Responsiveness - Willingness to help customers and provide
prompt service.
v) Tangibles-Appearance of physical facilities, equipment, personnel,
and communication materials.
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In their 1988 revision, Parasuraman, Zeithaml and Berry claimed that these five dimensions are generic and consistent across different types of services by stating that there was consistent factor structure across five independent samples.
However, basing this conclusion on a small sample raised doubts on its validity. Buttle (1996) found serious concerns with the number of dimensions as well as their consistency in different contexts. Carman (1990), after conducting a research which involved testing the five dimensions in services other than those that were used by Parasuraman, Zeithaml &Berry , warned that while the Parasuraman, Zeithaml and Berry items provide a start for item development, all items need to have validity and reliability checks before commercial application. Carman (1990) further states that the dimensions may have been over-generalized and suggests that some items of the ten dimensions that were no longer explicitly stated in the five dimensions be retained until further factor analysis shows that they really are not unique.
Peter et al. (1993) also suggested that the overlap between responsiveness, assurance, and empathy was understated by Parasuraman, Zeithaml &Berry in their original study. Woo and Ennew (2005), meanwhile, found that in business services markets, the dimensions were completely different.
Thus, at its best, the five dimensions should only be considered as a starting point rather than a tool that can be immediately used in the field. In their papers, Parasuraman, Zeithaml and Berry (1985, 1988) and Parasuraman and, Zeithaml (2006) consistently refer to the list as determinants or dimensions of service quality. However, it appears, from their definition of each dimension that they are only referring to process quality rather than total
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service quality. Woo and Ennew (2005) confirm this finding when they stated that Parasuraman, Zeithaml and Berry work on service quality dimensions and the subsequent SERVQUAL tool seemed to neglect technical quality altogether and focus mostly on the functional side. Richard and Allaway
(1993) clearly state that the dimensions of service quality as it is described by
Parasuraman, Zeithaml and Berry totally neglects technical quality.
Parasuraman, in a later work specified that service and services mean different things (1998). Services (plural), according to him, refer to the intangible core product that a business provides to the firm. In contrast, service (singular) refers to the supplement that accompanies the core offering.
Essentially, he uses services to refer to outcome quality, while service to refer to process quality. Because of this poor choice of words, it only added further confusion.
Asubonteng, McCleary, and Swan (1996), on the other hand, defend
Parasuraman, Zeithaml and Berry model by stating that because outcome quality is difficult to evaluate for any service, customers will often rely on other characteristics of the service to determine its quality. That is, they will rely on the process quality to determine or make an approximation of the total service quality. Asubonteng, McCleary, and Swan did not provide any empirical data to confirm this. Their claim that outcome quality is difficult to evaluate for any service is flawed and some examples disprove their statement. Apart from this, Richard and Allaway (1993) found that Parasuraman, Zeithaml and Berry model measuring only process quality was less reliable than another model that measured both process and outcome quality. Thus, Parasuraman,
Zeithaml and Berry five dimensions of service quality, while useful as a
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starting point, were declared an inadequate tool for measuring a firm’s total service quality. Other than identifying the gap between expected service and perceived service, Parasuraman, Zeithaml and Berry also identified four other tributary gaps that originate from the provider’s side.
These gaps were described as follows:
The five gaps that organizations should measure manage and minimize:
•Gap 1 is the distance between what customers expect and what managers think they expect - Clearly survey research is a key way to narrow this gap.
•Gap 2 is between management perception and the actual specification of the customer experience - Managers need to make sure the organization is defining the level of service they believe is needed.
•Gap 3 is from the experience specification to the delivery of the experience -
Managers need to audit the customer experience that their organization currently delivers in order to make sure it lives up to the specifications.
•Gap 4 is the gap between the delivery of the customer experience and what is communicated to customers - All too often organizations exaggerate what will be provided to customers, or discuss the best case rather than the likely case, raising customer expectations and harming customer perceptions.
•Gap 5 is the gap between a customer’s perception of the experience and the customer’s expectation of the service - Customers’ expectations have been shaped by word of mouth, their personal needs and their own past experiences. The routine transactional surveys after delivering the customer experience are important for an organization to measure customer perceptions of service. Parasuraman, Zeithaml &Berry (1985) and
Parasuraman & Zeithaml (2006) also provided a diagram to illustrate how
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these gaps interacted with one another and with the customer gap. They were not very clear about the purpose of some of the interconnecting lines between the boxes. To clarify, the gaps are limited to the solid lines with double- headed arrows.
Chart 4 the Provider Gaps (Parasuraman, Zeithaml &Berry)
The dotted lines, on the other hand, represent the direction of influence. For example the company’s perceptions of consumer expectations influences service standards. Likewise external communication influences the customer’s perceived and expected service. Finally, the line that connects
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external communications with service standards may be taken to mean that they must be coordinated with one another. Parasuraman, Zeithaml and Berry in their 1985 paper, identified the need for a tool that puts into operation the five dimensions and gaps model of service quality. They later followed this up in their 1988 paper with a survey tool named SERVQUAL. The tool is divided into five major categories and labeled according to the five dimensions of service quality as identified by Parasuraman, Zeithaml and Berry.
Within the categories, four or five items are listed, totaling twenty two. Each item must be answered by the customer two or three times depending on the format being used. The two column format asks for the customer’s expected performance and his or her perception of the company’s performance under each item. The customer has to answer a total of forty four questions. The three column format adds a third question that asks for the customer’s expected minimum service performance, thus increasing the number of questions to a total of sixty six. The disadvantage of asking this many questions are that it can potentially lead to respondent fatigue which can negatively affect the quality of the data. Carman (1990) states that because of
SERVQUAL’s long list of questions it is operationally difficult to follow the
Parasuraman, Zeithaml and Berry procedure for collecting and analyzing these data. One observation of Parasuraman, Zeithaml and Berry
SERVQUAL tool is that, while the criteria for judging are embodied by the five dimensions of service quality and are therefore fixed, the scales of each criterion may change from time to time depending on certain factors such as the mood and past experience of the individual being interviewed. This is one weakness of this market research tool. Perhaps a way around it is to spread
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the survey across a diverse sample of the market and across various time periods to mitigate the effect of unrelated events that can affect the perception of a group of people. The problem with this, however, is that it can increase the survey cost. Carman (1990) also recognized the possibility that the customer’s familiarity with the service can also play a role in setting his or her expectations. While this seems like sound advice, it still does not make up for the scenario where a user, after having experienced a service of low quality, has lowered his expectations of future service encounters. The result might be that management will mistakenly interpret the SERVQUAL scores in the next testing period as a signal that their service quality has increased when, in fact, it is only the customer’s expectation that decreased. This shortcoming has been identified by other critics such as Buttle (1996) and not addressed by
Parasuraman, Zeithaml and Berry to this day.
The Critics such as Cronin and Taylor (1992) have responded to the work of
Parasuraman, Zeithaml and Berry stating that SERVQUAL and the underlying gaps model are conceptually wrong. Likewise, Buttle points out how
SERVQUAL fails to draw on established economic, statistical and psychological theory (1996). These scholars state that the literature’s hesitance to treat perceived service quality as an attitude is one of the key reasons why the theory is difficult to put into operation. In their 1988 work,
Parasuraman, Zeithaml and Berry stated that service quality is similar in many ways to an attitude. Cronin and Taylor (1992) on the other hand, found in their research that service quality is indeed an attitude. In 1980 Oliver found that an individual’s attitude is a function of his or her own expectations. Cronin and
Taylor (1992) confirm this statement through literature review and empirical
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data. They further demonstrate that perceived service quality is, in fact, an attitude. Satisfaction, on the other hand, is a function of perceived service quality. Cronin and Taylor also state that it is satisfaction not perceived service quality that has a significant effect on purchase intention. Based on these findings, Cronin and Taylor (1992) proposed a tool they call
SERVPERF as a replacement for SERVQUAL. They state that the performance-based scale developed (SERVPERF) is efficient in comparison with the SERVQUAL scale. In reality though, SERVPERF is merely a subset of SERVQUAL. That is, it only measures the perceived service process performance and disregards expected service process level. The rationale for doing so is because measuring the customer’s expected service level before the service is rendered is not always possible, leaving the firm to measure it instead at the end of the service and measuring the expected service level after the service has been rendered is inaccurate as the customer’s expectation, by then, has already been biased by the service rendered. Apart from removing the distortions caused by measuring expectations, SERVPERF also shortens the questionnaire from a maximum of sixty six down to just twenty five, thus reducing the likelihood of respondent fatigue.
A number of questions also arise regarding the validity of Cronin and Taylor’s findings. The customer satisfaction and perceived service quality are entirely different constructs, where the former is an evaluation based on a specific transaction while the latter is a general assessment developed over a period of time (Parasuraman, Zeithaml and Berry 1994). Since SERVPERF is designed to measure customer satisfaction, and SERVQUAL is designed to measure perceived service quality, is it not correct to compare the two.
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Parasuraman, Zeithaml and Berry (1994) believe that it is not a valid comparison and point out that Cronin and Taylor’s paper is questionable at best in its conceptual, methodological/analytical, and practical aspects. They further state that Cronin and Taylor’s work seem to discount prior conceptual work in the service quality (SQ) literature (Parasuraman, Zeithaml &Berry
1994). Still there is no consensus among scholars on how to measure service quality perceptions. Brady and Cronin (2001) state that work on service quality can best be described as divergent. Even so, SERVQUAL remains to be the dominantly used model for evaluating service quality (Woo and Ennew
2005) despite it being highly criticized by scholars such as Buttle (1996) and
Cronin and Taylor (1992). A recent empirical study by Brady et al. (2005) found that service quality, customer satisfaction, and product value all had a direct effect on behavioral intentions. Thus, they have effectively rendered the debate on which is a better construct for predicting behavioral intentions as irrelevant. From their findings, they produced what they call a comprehensive model which they found to provide a more accurate representation of the firm’s quality of service. Surprisingly, their comprehensive model produced a survey questionnaire with only thirteen questions. While their work is fairly new and rebuttals and reviews are yet to be made available, the model they propose shows promise and its future development will be worth monitoring.
The mobile service industry is experiencing phenomenal global change with the liberalization and privatization of the sector, which also opened the competition (Beard and Hartmann, 1999). It opens the opportunities for the consumers to enjoy the choice among the service providers. These days, the cellular mobile service provider (CMSPs) offers innovative services at
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competitive prices. The nature of the competition today in the global telecom industry seems to centre on market activities that aim at gaining competitive advantages through strategic combinations of resources and presences in multiple products and geographical areas (Chan-Olmsted and Jamison,
2001).
In a competitive market, cellular mobile service providers (CMSP) are expected to compete on both price and quality of service and it is necessary for them to meet the customer’s price and service quality expectations
(Melody, 2001). The quality of the customer service is becoming a key success factor for cellular mobile service providers (CMSPs) as mobile markets mature and approach saturation, telecom operators strategies are rapidly evolving. The revenue growth is increasingly sought by maximizing the value of the existing customer base, complementing (or even substituting) gross addition strategies. At the same time, continuous improvements in operating efficiency underpin bottom line enhancements (and shareholder returns). In this context, customer care traditionally perceived as a necessary cost is rapidly becoming a key success factor.
Some researchers have developed and recommended the use of measured disconfirmation where customers are asked to estimate performance against expectations (SERVQUAL model).Some others believe that perception alone
(SERVPERF model) measure is the better predictor of customer evaluations and factors of interest. One of the important observations in the latest research are first, both computed and measured disconfirmation are reliable and yield the same results, therefore, it is unnecessary in any case to separately capture expectations that result in lengthy surveys. The selection
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of tool shall be guided by the research objectives (Pratibha, David and Dayle,
2000). To meet the objectives of this research study modified SERVQUAL model is used. It was also found that the different measurement scales including disconfirmation scale, service quality scale or customer satisfaction scale if used singly or together, get more or less the same result (Grapetine,
1988).
Service quality is increasingly recognized as being of key strategic value by organizations in both the manufacturing and service sectors (Lewis et al.,
1994). The competition has prompted firms to be more concerned with the quality of their service delivery, and cellular mobile service is no exception.
The service quality has become a major area of attention by practitioners, managers and researchers owing to its strong impact on business performance, costs, customer satisfaction, customer loyalty and profitability
(Leonard and Sasser, 1982; Cronin and Taylor, 1992; Gummesson, 1998;
Silvestro and Cross, 2000). As a result, there has been continued research on definitions, modeling, measurements, data collection procedures, data analyses etc. According to Brown (1992), customers prefer organizations that deliver higher service quality, and suppliers can charge a premium for superior service quality. Parasuraman et al. (1988) indicate that service quality has become a significant differentiator and the most powerful competitive weapon that all service organizations seek to possess. As a result, service quality has become an important means of differentiation and is critical for achieving success. The proven positive relationship of service quality with customer satisfaction (Danaher and Mattsson, 1994; Leisen and
Vance, 2001), customer loyalty and retention (Ranaweera and Neely, 2003),
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profitability (Thompson, DeSouza and Gale, 1985; Bloemer, Ruyter and
Wetzels, 1999) and competitive advantage (Hampton, 1993) provides a base to explore the subject in the cellular mobile context. For the past few years, cellular mobile service sector has been experiencing the highest growth rate in terms of revenues and customers in many countries as well as in India.
Despite the ongoing concern about service quality, most of the cellular mobile service providers (CMSP) in India focus primarily on expanding their customer base and tend to overlook investing in service quality. In the context of such an intensifying competition in this sector, service quality is imperative to achieve competitive advantage.
Although numerous researchers have made theoretical and empirical contributions to the study of service quality in various industries (like banking, health care, education, etc.), the area of cellular mobile communication is not adequately researched. Previous studies in this area primarily focused on functional quality aspects (i.e., pertaining to service delivery process or how the services are delivered) and inadequately addressed technical quality aspects (i.e., issues concerning what is actually delivered). Wang and Lo,
2002; Johnson and Sirikit, 2002 emphasized that technical quality attributes play an important role in forming service quality perceptions of customers. In light of this, the objective of the research is to investigate service quality by combining both functional as well as technical quality attributes. The value added services are becoming popular day by day which is not included in any study. This, the study also aims at finding the importance of service quality dimensions from the customer’s perspectives. This would enable the CMSPs to understand and focus on customer’s quality requirements.
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Over the last few years, there has been a considerable research on different aspects of service quality leading to a sound conceptual base for both practitioners and researchers. Authors (Parasuraman, Zeithaml and Berry,
1985, 1988; Carman, 1990) agree that service quality is an abstract concept, difficult to define and measure. Also the issue of universal dimensions of the
SERVQUAL scale for various service applications is debatable. Further, researchers (Mangold and Babakus, 1991; Richard and Allaway, 1993) agree that both SERVQUAL and SERVPERF scales may not be comprehensive in capturing the service quality construct, as both of them focus only on the functional quality attributes, and not on the technical quality attributes.
Therefore, the present research adopted a unified approach by combining functional as well as technical quality attributes for service quality measurement of cellular mobile services. Improvements in service quality can also enhance competitiveness. New dimensions of the service quality (SQ) have become relevant after become relevant in India and needs to be researched. For service quality measurement in telecom (including fixed line and cellular mobile services), researchers have supported both SERVQUAL as well as SERVPERF tools. Although service quality literature is found to be rich in empirical studies on different service sectors, service quality modeling in cellular mobile services is not adequately investigated. Further, to meet the objectives of the study some modification is done in the service quality modeling by introducing new parameters. This conclusion is done after the review of the following research studies.
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4.6 Customer Service Quality Studies in Telecom
Ramesh Krishnan and Monika Kothari (2008) conducted a study in Indian telecom industry to find antecedents of customer relationships. With the help of preliminary survey, authors identified independent variables namely; variety of service, price, advertisements, employee behavior, customer service, accuracy in billing and timely information, and the dependent variable was the preferred telecom brand. The empirical results predicted that the variety of service and customer service were found the best indicators for brand recommendation.
Makam S Balaji (2009) conducted an empirical study in Indian mobile services sector to investigate the antecedents of customer satisfaction. They examined the causal relationship among customer expectation, quality, value, satisfaction, and loyalty. The author arrived on the conclusion that perceived quality is an important predictor of customer satisfaction, which ultimately results in trust, price tolerance, and customer loyalty. A study was done in
Iran’s mobile telecom market based on the well-known SERVQUAL model, to evaluate the service quality with modifications made by Wang Po-Lo (2002) to reflect the industry attributes of mobile telecom. The outcome of this study concluded that four out of six dimensions of service quality were strong predictors of service quality in Iran’s mobile telecom market and had positive influences on customer’s perceived service quality. Gathered empirical results showed that in mobile telecom industry in Iran network quality, empathy, assurance and reliability are strong determinants of service quality while tangibles and responsiveness are weak ones and aren’t salient dimensions in
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forming service quality perceptions. According to the results of this study, firms expecting to build and maintain competitive advantages in this market must seek to deliver higher and better service quality.
Wang and Lo (2002) studied the integrated framework for service quality, customer value, and customer satisfaction and behavior intentions of customers in China’s mobile service sector. In this study, they conceptualized factors with service quality as antecedents to customers’ overall evaluation of service quality rather than dimensions or components of the construct. They found that the competition between two mobile phone service providers is more intense than ever. Wang and PO-Lo applied the SERVQUAL instrument in addition to five general dimensions of SERVQUAL, network quality was considered the sixth dimension for performance in mobile telephony based on a qualitative study of organized customer focus groups. Network quality is indicated by excellent indoor and outdoor coverage. A modified set of the original 22-items of SERVQUAL was used to measure functional quality. Such modification of the instrument for different service settings has been recommended by the developers of SERVQUAL Parasuraman et al., 1994.
Vander Wal, cellular mobile service focused on the customer’s perception of service quality Pampallis and services SERVQUAL instrument is reliable for the measurement of ser-Bond, 2002 vice quality in the telecommunication industry in South Africa.
As per the research done by Kim, Park and cellular mobile service quality has positive impact on customer satisfaction. Study Jeong 2004 services revealed that call quality is the most important issue that impacts customer satisfaction for mobile services analyzing the customers.
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It can be concluded from the above studies that and literature review both in
Indian and International context with reference to telecom service sector, there is dearth of empirical studies covering the present research aspect.
While considering the different players of mobile services present in Mumbai market, it is very difficult for the companies to retain the customers, because almost every CMSP has all advance technologies, talented personnel, good infrastructure etc. Therefore is imperative for the service providers to have updated knowledge about the various dimensions of customer services, so that they can frame competitive marketing strategies to attract and retain their customers for a long time. The present research work is focused on the analysis of the quality of customer services so that they can gain competitive advantage in the market.
4.7 Customer’s Expectations from CMSP
The customer’s expectations are beliefs about service delivery that function as standards or reference points against which performance is judged because customer compare their perceptions of performance with these reference points when evaluating service quality. The knowledge of customer expectations is very critical in delivering quality service. It is found that customers hold several different types of expectations about service. The first can be termed desired service which the customer hopes to receive. It is a blend of what the customer believes can be and should be. In case of mobile services the customer expects that he gets facility to receive and make incoming and outgoing calls with reasonable voice quality. Sometimes it
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happens in the service delivery process that there are problems due to which the provider is not able to provide desired service. The customer agrees for a lower level expectation, this is termed as adequate service. In case of the mobile services if there is congestion in the network at busy hours than Short message services (SMS) facility should work so that the customers are reachable. The adequate service represents the minimum tolerable expectations, the bottom level of performance acceptable to the customer and reflects the level of service customers believe that they will get on the basis of their experience with service. The desired service is the upper limit of expectation and adequate service is the lower limit of customer expectations.
The desired service level is less subject to change than the adequate service level. Any service provided between these limits is tolerable by the customer.
This zone is called the zone of tolerance71. But it is interesting to note that individual and corporate customers possess different zones of tolerance and it also varies for different service attributes. The fluctuation in the individual customer’s zone of tolerance is more a function of changes in the adequate service level which moves up and down due to situational circumstances then in the desired service level which tends to move upwards incrementally due to accumulated experiences.
The expectations of mobile telecom customer are influenced purely by their personal needs72. The mobile telecom product should meet the physical and psychological well being of the customer which shapes the desired service level this keeps on changing. Some customers are more demanding than others having greater sensitivity and higher expectations of service.
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One of the important of these factors can be called derived service expectations which occur when customer expectations are derived by another person or group of people. This is very important as the mobile services in these days are used in closed user group (CUG). Another enduring service intensifier is personal service philosophy, the customer’s attitude towards cellular mobile service provider (CMSPs) and service providers. The word of mouth and past experience are two important factors that play a major role in influencing the expectations of the customers keep while choosing mobile services.
4.8 Customer’s Perception of Cellular Mobile Service
The customer perceives services in terms of the quality of the service and how satisfied they are with their experiences in receiving the incoming and outgoing calls. It can be defined in a precise manner as the experience of the consumers regarding the service provided by the cellular mobile service provider (CMSPs). In the present competitive market, companies are trying their best efforts to gain competitive edge over their competitors. But the attraction and retention of the customers has become quite imperative for the service organization, because it has become major strategic tool.
The CMSPs today recognize that they can compete more effectively by distinguishing themselves with respect to service quality and improved customer satisfaction. The service quality and satisfaction have a lot in common but they are fundamentally different. The service quality (SQ) is a subset of satisfaction. It is a component of customer satisfaction. The Service
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Quality (SQ) is a focused evaluation that reflects the customers’ specific dimensions of service like reliability, responsiveness, assurance, empathy and tangibles while the satisfaction includes service quality product and price.
The quality of customer service depends on the fact that what customers perceive about the quality of the service offered in relation to the expectations based on promises made by the providers. It has been recognized as a strategic tool for attaining operational efficiency and improvement in business performance (Anderson and Zeithaml, 1984; Babakus and Boiler, 1992;
Garvin, 1983; Phillips, Chang, and Buzzell, 1983). It was demonstrated by researchers that positive relationship between qualities of service (QoS) with profits, increase in market share for companies, customer satisfaction, return on investment, and purchase intentions in future time (Boulding., 1 993;
Anderson, Forneil, and Lehman, 1994; Buzzell and Gale, 1987; Rust and
Oliver, 1994).
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Chapter -V Cellular Mobile Service in Mumbai Region
5.1 Introduction
5.2 History of Mumbai
5.3 Geographical Location of Mumbai
5.4 Qualitative Analysis of Customer Service
5.4.1 M/s Vodafone Ltd
5.4.2 M/s. Bharti Airtel Ltd
5.4.3 M/s. Tata Teleservices Limited (TTSL)
5.4.4 M/s. Reliance Communications Limited
5.4.5 M/s. Loop Mobile Ltd
5.4.6 Mahanagar Telephone Nigam Limited
5.5 Problems faced by CMSPs
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Chapter -V Cellular Mobile Service in Mumbai Region
5.1 Introduction
India, a union of states, is a Sovereign Socialist Democratic republic with a parliamentary system of government. It is one of the largest democracies in the world and seventh largest country in area. It is well separated from the rest of Asia by mountains, and the sea which gives it a distinct identity. With a population of 1.2 billion73, it ranks second to China among the world’s most populous countries. Its people are culturally diverse. In India language and dialect change after every ten kilometers, eighteen major languages and more than 1,000 minor languages and dialects are spoken here. This posses a major challenge to the cellular mobile service application developers community. The mobile service market in India is still unexploited.
5.2 History of Mumbai
Mumbai lies on the west coast and has a natural harbor74. It is capital of
Maharashtra state. It is built on what was once an archipelago75 of seven islands Bombay Island, Parel, Mazagaon, Mahim, Colaba, Worli, and Old
Woman’s Island also known as Little Colaba. These islands were home to
Koli76 communities. These islands came under the control of successive empires being ceded to the Portuguese and subsequently to the British East
India Company. Mumbai was reshaped by British and it emerged as a trading
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town known for its textile mills. In 1950, municipal limits of Mumbai were expanded by merging the Bombay suburban district and Bombay city to form
Greater Bombay Municipal Corporation. In the late 1960s, Nariman Point and
Cuffe Parade were reclaimed and developed. The textile industry in Bombay largely disappeared after the massive 1982 textile strike, in which nearly
250,000 workers in more than 50 textile mills went on strike.
5.3 Geographical Location of Mumbai
Mumbai consists of two distinct regions Mumbai City district and Mumbai
Suburban district these are two separate revenue districts77 of Maharashtra.
The city district region is also commonly referred to as the Island City or South
Mumbai. This comes under the administration of Brihanmumbai Municipal
Corporation (BMC). The remaining area belongs to Defense, Mumbai Port
Trust, Atomic Energy Commission and Sanjay Gandhi National Park, which are out of the jurisdiction of the Brihanmumbai Municipal Corporation (BMC).
The coastline of the city is having number of creeks and bays. In 1995 the
English name of the city Bombay was changed to Mumbai78.
As per the Cellular Mobile Telecom Service (CMTS) license the Location of
Mumbai Region is restricted to the following latitude and longitude.
Table 5.1 the Location of Mumbai Region as per the DoT.
SNo Direction Longitude Latitude
1. Top Right 73 ° 13’ 23.10’’ E 19° 14’ 24.95’’ N
2. Bottom Left 72 °43’ 35.24’’ E 18 °57’ 58.88’’ N
Source: DoT
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5.3.1 Climate
Mumbai has a tropical climate seven months of dryness and peak rains in
July. It gets flooded on rainy days during high tides which results in the failure of mobile services due to congestion. The period from June to September constitutes the south-west monsoon season, and October and November form the post-monsoon season. The cold season from December to February is followed by the summer season from March to June. The average annual temperature is 27 °c.
5.3.2 Economy
Mumbai is the financial capital of India as it generates substantial Gross
Domestic Product79 for India. It serves as an economic hub of India, contributing significantly to employment, industrial output, tax collections and foreign trade. It is also one of the richest cities of India. Many of India’s numerous conglomerates and number of Fortune Global 500 companies are based in Mumbai. Many foreign banks and financial institutions also have branches in Mumbai. In order to meet the communication and Information technology demands of these companies there is an urgent need for world class mobile services in Mumbai.
5.3.3 Politics
The first session of the Indian National Congress80 (INC) was held in Bombay from 28 to 31 December 1885. The city played host to the Indian National
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Congress six times during its first 50 years, and became a strong base for the
Indian independence movement during the 20th century.
5.3.4 Railways
The backbone of the city’s transport consists of three separate rail networks
Central, Western, and Harbor Line, running across the length of the city, in the north-south direction. It carries a total of 6.95 million passengers every day81, which is more than half of the Indian Railways daily carrying capacity. On an average a Mumbaikar spends approximately 140 minutes per day82 in travelling. They spend this time in conversing with business associates, friends and family, playing games and listening to music.
5.3.5 Telecom Services
The cellular mobile services in Mumbai were launched by Hutchison Max in
1995. The mobile service coverage is extensive, and the main service providers are Vodafone limited, Bharti Airtel, MTNL, Loop Mobile, Reliance
Infocom, Idea Cellular and Tata Indicom, Videocon, Aircel, MTS and Etisalat
DoCoMo. There are still dark spots where the network coverage is not available. Mahanagar Telephone Nigam Limited (MTNL), held a monopoly over fixed line up until 2000 and was the largest telecom infrastructure provider.
5.3.6 Demographics
Mumbai has a population of 20.4 million83. The population density is estimated to be about 20482 persons per square kilometer84. The distribution of
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population upto 14yrs is 31.5%, from 15 to 60 yrs is 63.3%, and 65 yrs is
5.2% only. The CMSPs are facing difficulty in providing adequate network coverage in high population density area. The residents of Mumbai call themselves Mumbaikar. The official language used in Mumbai is Marathi85 it is widely spoken and understood in the city. A colloquial form of Hindi, known as
Bambaiya a blend of Marathi, Hindi, Indian English and some invented words is spoken on the streets. The Bambaiya language is frequently featured in advertisements by cellular mobile service providers (CMSPs).
5.3.7 Dharavi
Dharavi is a slum spread over parts of Sion, Bandra, Kurla and Kalina suburbs of Mumbai. With a population of more than one million people,
Dharavi is one of the largest slums in the World. It exports goods like traditional pottery, textile, leather goods and carpets all around the world and has a large recycling86 industry. This area is very congested and it is very difficult to install towers and other radio frequency infrastructure the area is mostly covered by the Base Transreciever System (BTS) installed in the nearby localities.
5.4. Qualitative Analysis of Customer Service
5.4.1 M/s. Vodafone Limited
Vodafone limited Essar, commonly referred to as Vodafone, is a pan India
GSM operator. It was formerly known as Hutchison Essar87. It is the second largest cellular Mobile service provider (CMSP) in terms of revenue after
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Bharti Airtel, and third largest in terms of number of customers. It has a strong presence in the metros. In 1992, Hutchison Whampoa88 and Max Group89 established a company in India. In 1994 a license was awarded to them to provide cellular Mobile telephone service (CMTS) in Mumbai. They launched mobile services in 1995 in the brand name Hutchison Max90. In the beginning the company grew its business in the metro cities.
In 2004 it acquired six cellular mobile service providers (CMSPs) offering mobile service in thirteen of India’s twenty three license areas and after acquisition of BPL Mobile that number increased to sixteen. In 2006, it acquired Essar Spacetel a subsidiary of Essar group that held license for the seven remaining license areas. It established a robust network, well known brand and large distribution network all vital for long-term success. Then it targeted business users and high-end post-paid customers which helped it to generate a higher Average Revenue per User (ARPU). It established leading positions in India’s metro markets garnering the resources to expand its foot print nationwide.
It was often praised for its award winning advertisements which all follow a clean, minimalist look. A recurrent theme is its message Hello which stands out visibly though it used only white letters on red background. Another successful advertisement campaign in featured a pug named Cheeka following a boy around in unlikely places, with the tagline, ‘wherever you go our network follows’. The simple yet powerful advertisement campaigns won it many admirers. The advertisements featuring the pug were continued by
Vodafone limited even after rebranding. Vodafone limited is making an important contribution by enabling a low-carbon society through bespoke
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products and services that meet specific needs in local markets. After
Hutchison Essar becoming part of Vodafone limited Group, the new campaign was done by Vodafone limited on the transition from Hutch to Vodafone. The rebranding from Hutch to Vodafone launched a price war in Mumbai region. It offered mobile handsets to new subscribers at ultra-cheap prices, ranging from about 950 to 1300 under the Vodafone brand, and also co-branded handsets sourced from major global vendors. It tied up with low cost mobile handsets vendors across the globe into India, it bundled handsets with attractive tariff plans through its existing sales network. In the past similar handset-driven expansion strategies to grow were adopted by CDMA players, like Reliance Infocom and Tata Teleservices limited. It was first GSM operator who offered this. It is promoting self service from its website in a big way, which is becoming popular day by day. Now there´s no need to call a customer care executive to look for information on bill, talk plan or new services. All this information can be delivered on the mobile handset by sending a short message service (SMS) request to a particular short digit code91.
5.4.1.1 Vodafone limited Outlets
The Vodafone limited neighborhood store sells recharge coupons and prepaid connections. The area wise count is as follows:
Table 5.2 the number of Vodafone limited outlets in Mumbai region.
Sno Central Mumbai Navi North South Thane Total Mumbai 1. 575 880 25 700 890 32 3602
Source: Vodafone limited web site
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5.4.1.2 Vodafone limited Mini Stores
The Vodafone limited mini store caters to the new connections and pay bills for post paid services.
Table 5.3 Number of Vodafone limited mini store in Mumbai.
SNo Mumbai Navi Mumbai Thane Total
1. 63 23 33 119
Source: Vodafone limited annual report.
5.4.1.3 Vodafone limited Stores
These are owned by Vodafone limited and they provide all the services related to postpaid and prepaid. The poor resolution of these stores is an issue. It has somehow managed to keep quality people in their work force, but still the technicalities haven’t let them work to their full strength.
Table 5.4 the number of Vodafone limited stores in Mumbai region.
SNo Mumbai Navi Mumbai Thane Total
1. 28 4 4 36
Source: Vodafone limited web site accessed on 24th Oct 2011.
5.4.1.4 Vodafone limited Mobile Stores
These centers located in vehicles that travel around the city, where the customers can get the prepaid connections and recharge coupons, view
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demos and activate value added services. The information on the latest tariff plans and SIM replacement is also available.
5.4.2 M/s. Bharti Airtel
Bharti Airtel is pan India Global System for Mobile systems (GSM) Cellular
Mobile Service Provider. It provides mobile services under the brand name
Airtel. It launched a new business model called minutes factory model to serve the market effectively. It recognized its core capabilities as only to understand customer’s needs and build brand value. It lacked competencies of traffic forecasting traffic and network engineering, despite the fact that these competencies are a must for every cellular mobile service provider
(CMSP).
It hired well-known global equipment vendors to ensure quality services. It also chose International Business Machine92 (IBM) to build and manage the
Billing and customer care network. The vendors were paid as a percentage proportional to the revenue generated. As a result, its fixed costs in capital expenditure were converted to a variable cost based on usage of capacity and revenue from services. The local call tariff of mobile service in India is Re
0.10 to Re 0.60 per minute, perhaps the lowest in the world. Despite the lowest call rates it enjoyed compounded annual growth in sales revenues by the implementing the minutes of factory business model of reverse innovation.93
In order to make Airtel brand an intrinsic part of consumer’s lifestyle and providing them ability to transact business using their respective mobile devices as payment instruments, it launched m-commerce94 service, the first
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of its kind ‘check on Airtel’. It is the convergence of wireless communication technology and commerce. The m-commerce provided two distinctive advantages viz. flexibility and ubiquity. This enabled the mobile customer to conduct business transactions without being fixed at a computer terminal or being physically present at the shop. This brought simplicity, convenience, ease of use & safety. It provided a secure and convenient channel to link existing credit cards, debit cards or bank accounts and carry transactions, including paying postpaid bills, recharging prepaid accounts, paying fixed line and broadband bills, buying movie or air tickets, paying insurance premiums and much more.
The breakup of the Airtel relationship centre in Mumbai license area is
Table 5.5 the area wise number of the Airtel stores in Mumbai region.
Sno Central South West Thane Total
1. 5 6 11 6 28
Source: Airtel web site accessed on 26.11.2010.
Bharti Airtel has employed a multi regional sales team for both direct and indirect sales channels95. The regional organizations are responsible for defining the sales and marketing strategies for their respective territories.
They also generate significant inputs and reviews on corporate strategic sales, marketing, and product direction. In order to capitalize on the opportunities in each geographic region, it has put into place a network of on- the-ground, experienced and incentivized sales and marketing personnel. The
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sales teams there build both direct and indirect channels. The dealers are motivated to focus on customer loyalty apart from selling.
It has employed urban distributors (UD) for urban area and rural distributors
(RD) for rural areas. It makes invoice of Subscriber Identity module (SIMs), pay phones, and recharge coupons of small denominations of Rs. 10, 30 and
60. The recharge coupons are transferred to the distributors (UDs) electronically. The Distributors pass on the above items among the retailers according to the demand, and transfer recharge balance to retailer through
(Field officer Sales) FoS SIM96. This three level distribution is used to reach suburban and rural areas which are otherwise difficult to cover.
The second level distribution is suitable for urban areas because the demand is higher, there is high population density and that’s why quick availability of product and services is essential. All retailers are provided with a special SIM
(Lapu SIM97), which retailer falling under the particular beat is mapped with corresponding (Field Officer Sales) FoS of that beat. The distributors use
Subscriber Identity Module (SIM) to transfer and recharge coupons mapped to
FoS. It uses Subscriber Identity Module (SIM) to transfer the easy balance to mapped retailer’s Lapu SIM. The distributor gets discount which is passed on to their retailers. The distributor manage the supply of Subscribers Identity
Module(SIM) Cards, recharge coupons, easy recharge, Customer acquisition form(CAF), GSM pay phones, Lapu SIM, FoS SIM, replacement SIM as per the requirement within its beat area. They activate mobile connections after proper verification. They also manage promotional materials among the retailers according to the allocation of territory manager. They maintain distributor health report, secondary details regarding retailers and Subscriber
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Identity Module (SIM) activation details. These reports are shared with territory manager. The distributor escalates retailer’s claims and complaints to territory manager and zonal sales manager.
5.4.3 M/s Tata Teleservices Limited (TTSL).
It is a subsidiary of Tata Group98 an Indian conglomerate headquartered in
Navi Mumbai. It is a pan India cellular Mobile service provider (CMSP) and offer CDMA and GSM services under the following Brand names:
i) Tata Indicom and Virgin Mobile (CDMA Mobile operator)
ii) Tata DoCoMo and Virgin Mobile (GSM Mobile operator)
It offers multiple tariff plans in postpaid and prepaid category and value added services. The company’s retail business has around 3,000 outlets; comprising
600 Tata Teleservices Limited (TTSL) owned stores and around 2,500 stores in franchisee format. It also maintains an online portal for its customers i- choose where the customers can buy postpaid connections and prepaid recharge vouchers with an upfront commitment of activation and delivery.
Tata Teleservices Maharashtra Limited (TTML) spearheads the Tata group’s presence in the telecom sector in Maharashtra and Goa. It commenced full mobility wireless services on the Code Division Multiple Access (CDMA)-1X99 platform in 2004-5. In October 2007 it launched Tata Zone, an infotainment portal on BREW-enabled mobile phones, in Hindi. This service provided applications, pricing details, downloads and browsing instructions in Hindi. In value added service bouquet, it offered services such as News, Games, Faith and Prayers, ring tones, Streaming TV, Fun Shows, Video Zone, Song
Download Express, Cricket, Internet Surfing, Astrology, and Mobile Office
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among others. It provided m-commerce, mobile advertising and social networking. It has a significant presence in Global System for Mobile communication (GSM) space, through its joint venture with NTT DOCOMO, and offers differentiated products and service under the Tata DOCOMO brand name. It marks a significant milestone in the Indian telecom landscape, being the first to pioneer the per-second tariff option part of its ‘Pay for What You
Use’ pricing paradigm.
With a full portfolio of products and services for different categories of retail and enterprise consumers and an excellent network backed by good customer care, it is well positioned to lead the market. It has been rated as number one wireless operator in terms of overall customer satisfaction across
Maharashtra (including Mumbai) and Goa, in surveys commissioned by the
Telecom Regulatory Authority of India (TRAI). The two companies have more than 85 million subscribers, fourth in pecking order. It has decided to adopt a three pillar strategy for the brand’s growth. They have realized that there is a growing market there to reach out to, and every minute, a new generation mobile user walks in. The customers are in constant search for new, better and latest services. If attention is not given to the customers they will churn and go away.
For building brand image, which is the first pillar of strategy, they have decided to go on from being positioned as a cheap brand. They are expanding its retail network as well. It converted all True value hubs stores and singularly named them Tata Indicom exclusive stores.
Innovation is the second pillar of the company’s strategy. Driving towards innovations, the company plans to leverage its mobile products for the youth
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with the objective of showing off its value added service offerings. It conceptualized and executed an AFP (advertiser’s funded programme), as a branded reality show, showcases celebrities utilizing services. The third pillar is objective of driving numbers by addressing popular segment.
The television accounts for the maximum share of brand’s advertising pie.
Apart from advertising through traditional media, it is sponsoring seminars and taking up direct marketing initiatives, which will give it the opportunity to showcase the product solution offered by the brand as well as to build a strong imagery. In 2009, the company moved to the current positioning,
‘Switch to Tata Indicom and Experience the Difference’, which worked wonders for it.
Tata telecom (TTSL) has registered its name in the Limca book of records for as the only cellular mobile service provider (CMSP) in India to inaugurate 100 true value Shoppe (TVS) across the nation on one single day. Since then the company has rolled out more than 1000 store in one year. It has also co branded the stores as Tata Indicom exclusive stores. They were earlier known through two separate formats a True value hubs and True value Shoppe.
The branded retail business unit looks after the Shoppe retail chain of Tata
Indicom Exclusive stores. It has 3100 outlets comparing to the 600 company owned stores and more than 2500 stores in the franchise format. The sales outlets are designed to ensure similar experience to the customers.
5.5.4 M/s Reliance Infocom Communications Limited (RCOM)
RCOM is a major Indian telecommunication company headquartered in Navi
Mumbai, India. It ranks among the top five telecom companies in the world by number of customers in a single country. It has a corporate clientele which
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includes 2,100 Indian and multinational corporations, and over 800 global, regional and domestic carriers. The company has established a pan-India, next-generation, integrated (wireless and wireline), convergent (voice, data and video) digital network that is capable of supporting services spanning the entire communications value chain, covering over 24,000 towns and 600,000 villages. It owns and operates the next-generation internet protocol enabled connectivity infrastructure, comprising over 190,000 kilometers of fiber optic cable systems in India, USA, Europe, Middle East and the Asia Pacific region.
In July 2007, it took over United State based Yipes and merged with Flag
Telecom. It operates GSM services in Madhya Pradesh, West Bengal,
Himachal Pradesh, Orissa, Bihar, Assam, Kolkata and Northeast. It owns the world’s largest private undersea cable system, spanning 65,000 km. It has over 110,000 km of domestic optic fiber provides a robust Global Service
Delivery Platform, connecting 40 key business markets in India, the Middle
East, Asia, Europe, and the U.S. Reliance Infocom Internet Data Center
(RIDC) RIDC provides Internet Data Center (IDC) services located in Mumbai,
Bangalore, Hyderabad and Chennai. Spread across 650,000 sq ft (60,000 m2) of hosting space, it offers Information Technology infrastructure management services to large, medium and small enterprises. It is one of the leading data center service providers in India and provides services like co-location, managed server hosting, virtual private server and data security. It has launched cloud computing services, offering product under its infrastructure mainly for small and medium, companies at pay-per-user model.
Reliance Infocom World is a nationwide chain of world-class retail outlets for all Reliance Infocom Communications products and services. It is designed to
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give the customer a delightful experience of the digital world of communication, entertainment and utility services. Besides a wide range of phones and associated services, a whole array of digital offerings at the
Reliance Infocom World. All Reliance Infocom World outlets are connected to
Reliance Infocom countrywide by optical fiber network. The Reliance Infocom
World leverages this broadband network to bring offerings like broadband surfing, online gaming, video conferencing, Digital electronic news gathering, digital services, eLearning, ticketing, virtual Office & many more services. It is convenience mobile store which offers a variety of products and services including sales of handsets and phones, phones services such as bill payment, value added services and much more. In Mumbai region the number of the Reliance Infocom world has 24 outlets and, Reliance Infocom web world is 113. It was a well networked chain of retailers approximately
5000 located in the neighborhood.
5.4.5 Loop Mobile
British Physical Laboratory (BPL) Mobile Communications Limited (now known as Loop Mobile) offered Global System for Mobile Communication
(GSM) in three states of India besides offering broadband facilities via wireless BPLNET with an Asynchronous Digital Subscriber Line (ADSL) internet competence. It is based in Bangalore; the firm is the subordinate of
Vodafone limited Essar Ltd. It has had the opportunity of providing of the mobile services in Mumbai. Later, in the year 2009, BPL Mobile rebranded itself as Loop Mobile and has been operating since then in Mumbai.
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In an attempt to offer best customer service practices, BPL Mobile
Communications Limited have set up Next Generation IP (NGIP). This extremely competent network improvisation allows it to provide voice clearness and wide-ranging coverage along with prompt data facilities. It is the only cellular Mobile service Providers (CMSP) in India to have fulfilled the telecom regulatory Authority of India (TRAI) yardsticks on a set-up and service excellence constraints. It has also been ranked as the best set-up by
Voice and Data, a primary telecom periodical. It has achieved a considerable market share of additional subscribers. The importance on expansion is evidently replicated in the firm’s increasing subscriber base. The firm traversed the user’s mark of 2-Million in 2009. Its latest identity, Loop Mobile symbolizes development with stability. The firm incessantly functions towards providing their subscribers an excellent set of connections, inventive products and a better-quality mobile service. It pledges to sustain the same focus and dedication in offering the excellent network connectivity, billing precision, and a matchless custom-made client service. It offers assured service through
Loop Mobile Galleries conveniently within reach across Mumbai city. They are equipped to offer a complete range of services like postpaid and prepaid connections, prepaid recharge coupons and Bill Payments, service enquiries and value added services (VAS) SIM replacements and mobile handset sales.
There are 24 Galleries and 8765 distributors which support the sales network.
5.4.6 Mahanagar Telephone Nigam Limited
‘Mahanagar’ means metropolis or mega city, ‘Nigam’ means enterprise. It is a state-owned cellular mobile service provider (CMSP) it operates in the metro
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cities of Mumbai and New Delhi. It was a monopoly until 1992, when the telecom sector was opened. It provides fixed line service, cellular mobile service both GSM Dolphin (postpaid) and Trump (prepaid) and wireless in the local Loop Mobile WLL (CDMA) Garuda-FW and Garuda-Mobile and internet services. It offers Games on demand, video on demand and Internet protocol television (IPTV) services through its broadband Internet service called
TriBand. It has been actively providing connections in Mumbai and New Delhi and the efficiency has drastically improved from the days when one had to wait years to get a phone connection to now when one can get a connection in hours. It also offers very cost-effective internet plans (TriBand) targeted at homes and small businesses. It is the largest Internet Service Provider (ISP) in Mumbai and Delhi.
It has presence in Mauritius and Nepal it provides basic, mobile and international long distance services. It has also formed a 50:50 joint venture with Software Technology Parks of India (STPI) .The Joint venture (JV) combines the software parks as an Internet Service Provider (ISP). It was done to realize one of the 10-point agenda of Ministry of Communication and
Information Technology (MoC&IT) for bringing about an all-round economic development. This aims to provide exclusive data center services, messaging services, business application services. It has restructured Millennium
Telecom Ltd. (MTL) as a Joint Venture company of Mahanagar telephone
Nigam Limited (MTNL) and Bharat Sanchar Nigam limited (BSNL) with equal equity participation. It will enter into new business stream of international long distance operations for executing a project of submarine cable system. With a presence in only two of the 23 telecom circles in India, the company is at a
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significant competitive disadvantage compared to pan-Indian players. The customer selects the cellular mobile service provider (CMSP) based on their tariff plans. The tariff rate has fallen to ½ paisa per second the lowest possible. The customer care can make or mar a brand now. MTNL lacks in customer care and marketing. To overcome this, it is planning to outsource its customer care. It has decided to create a separate arm for marketing and customer care activities. It has also recognized that information technology
(IT) is the key to future business success. A number of information technology systems are already made operational. The projects for data ware housing, call centers, e-commerce billing mediation, new Information technology (IT) policy consultancy projects are in pipeline. It has plans to synergize all its operation to total customer satisfaction by modernizing the services to international level.
Its sales network consists of customer service centre located in telephone exchanges buildings. These outlets are not available on holidays and after office hours. They operate from 8 AM to 8 PM. It has also appointed distributors for retailing mobile products in the market. The appointment of the retailers is left at the sole discretion of the distributors. It consists of the CSC
(customer service centers) located in the telephone exchanges in all the zones100 of Mumbai. The numbers of the outlets are enough in each area, but the customers are not happy with the response of the staff.
Table No: 5.6 the number of the service centre located in MTNL buildings. SNo SOUTH CENTRAL NORTH WEST EAST Navi Mumbai
1. 7 5 8 39 25 11
Source MTNL web site accessed on 12 Feb 2011.
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These distributor outlets are available in the market place it has no control over the retailers. There is no territory arrangement a number of distributors operate in the area of the other distributors. The sales commission paid by the distributors is more as compared to the other CMSP, but the distribution network is not organized properly. There are routine complaints about the shortage of the material in the market. The communication of the schemes is also not proper, separate sales staff is not marked.
Table No 5.7 the number of MTNL distributors and retailers.
SNo Dolphin Distributors Retailers
1. 22 2517
Source MTNL web site accessed on 12.10.2010
5.6 Problems faced by CMPS
The CMSP in Mumbai are facing problems in rolling out networks and providing radio frequency coverage due to following reasons: i) Due to the non availability of the permission for installation of BTS and radio equipment in Civic and Defense authorities ii) Changing sky scrapers which create shadow zones. iii) To provide antenna on the bridges and on the Creek. iv) The increasing number of Fly over’s.
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Chapter -VI The Research Methodology
6.1 Introduction
6.2 Problem Statements
6.3 Objectives of the Study
6.4 Deficiencies in the TRAI Standards
6.5 Benefits of the Study
6:6 Importance of the Study
6:7 Research Hypotheses
6.8 Data Collection
6:9 Sample Plan
6.10 Research Tools and Techniques
6.11 Scope of the Study
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Chapter –VI Research Methodology
6.1 Introduction
This research study needed extensive field work. It was decided to complete the field work in two stages. The first phase was planned to collect the secondary data particularly historical data through various web sites and publications. In the second phase the Primary data for this research was collected through structured questionnaire. The questionnaire used in enclosed in the end of this thesis. The printed copies of questionnaire were distributed to the respondents. A web site www.bbchaudhary.com was also opened to collect the electronic responses on email.
6.2 Problem Statement
The quality of service (QoS) is the ability of the cellular mobile service (CMS) network to provide a service with an assured service level; basically it is intrinsically a technical concept.
The telecom regulatory authority of India (TRAI) focuses on four main parameters fault incidence and repair, Network performance, billing complaints and customer perception of services. The first three parameters are purely technical they are measured, expressed and understood in terms of networks and network elements, which usually has little meaning to customers. The fourth parameter the customer perception of services measures the customer satisfaction and call centre performance.
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The benchmark for the perception of the customer services fixed by telecom regulatory authority (TRAI) in percentage seems to be very general. A number of factors such as price, product reliability, availability, usability and utility are not included in the customer perception.
In view of this, there is to a necessity to first study the perceptions and expectations of the customers. Then calculate the gap between the perceptions and expectations and make a comparative analysis of the Quality of customer service. The comparative analysis will help the customers to identify the Cellular Mobile Service Providers as per their specifications. It will also be helpful for the CMSP to improve their deficiencies.
6.3 Objectives of the Study
The main objective of this research is to do a Comparative Analysis of customer service provided by the CMSP in Mumbai region.
The summary of the objectives is as follows:
i) To study the process of providing Cellular Mobile Telephone
Service (CMTS).
ii) To study service quality standards set up by telecom regulatory
authority of India (TRAI).
iii) To study the customer expectations about service quality.
iv) To measure the performance of customer service quality against
the telecom regulatory authority of India (TRAI) standards and
customer expectations.
v) To find out the gaps in performance and to give suggestions
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6.4 Deficiencies in the TRAI Standards
The concept of end-to-end QoS according to international telecom union
(ITU)-T is adopted by Telecom Regulatory Authority of India (TRAI), is the degree of satisfaction of a customer using the service. In the course of time, however, the dominating research perspective has become more and more a technical one, focusing on monitoring and improving network performance parameters like packet loss rate, delay or jitter.
The Quality of Experience (QoE) is a subjective measure from the user’s perspective of the overall value of the service provided, and thus does not replace, but augment end-to-end service quality by providing the quantitative link to user perception. As such, it extends the current service quality perspective described above towards the actual end user, including technical quality as well as the expectations of the end users, the content of the service, the importance of service for the end user, the characteristics of the device, the usability of the human-computer interfaces, the joyfulness of interaction, the perception of security, and maybe even the price of the service, to name but a few new ingredients.
6.5 Benefits of the Study
With the growth of mobile services, it has become very important for CMSP to measure the quality of customer service of its network accurately and improve it further to achieve customer loyalty and maintain competitive edge. A poor quality of customer service will result in unsatisfied customers, leading to a
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poor market perception and ultimately, brand dilution. There are several factors that interact to determine customer service, including price, reliability, availability, usability, utility and fidelity. If a high experience is delivered to the customer then the user is happy and satisfied.
This study is of multidimensional nature as discussed above and will be beneficial to the Cellular Mobile service providers, manufacturers of wireless equipments, distributors, marketing agents and all those who are in the telecom trade. The study assumes greater importance in light of the present policy of liberalization and competition with global companies making faster in roads in the country.
6.6 Importance of the Study
It is acknowledged by one and all that, the cellular mobile services are a primary need of the citizens today. It is also used in a big way to provide infrastructure101 for business process. In view of the increasing customer demand the business processes for service delivery are becoming more complex day by day. The count of cellular mobile service providers (CMSPs) is also increasing day by day. Their first priority is to enroll new customers to achieve the breakeven point. The Quality of the customer service is their second priority. The customers are in a fix about how to select their cellular mobile service providers (CMSP). They have opted for the service of more than one cellular mobile service providers (CSMP) to remain accessible. In view of this, there is a necessity for a comparative analysis of the Quality of the customer service (QoCS).
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6.7 The Research Hypothesis
The first hypothesis
Null Hypothesis H01: The CMSPs in Mumbai are meeting TRAI parameters.
Alternate Hypothesis H11: The CMSPs in Mumbai are not meeting TRAI parameters.
Second hypothesis
The second research hypothesis is about the expectations of customers which are not fully included in telecom regulatory authority of India (TRAI) parameters. Hence a new model was proposed with modifications in the existing SERVQUAL scale. The data collected by survey was used for testing second hypothesis.
Null Hypothesis H02: The CMSPs in Mumbai are meeting the Customers
Expectations.
Alternate Hypothesis H12: The CMSPs in Mumbai are not meeting the
Customers expectations.
6.8 Data Collection
i) Primary Data collection the primary data was collected through the printed questionnaire after interviewing the customers in person a copy of the questionnaire was also kept on the web site to get the electronic response
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from the users. The sample of the questionnaire used in enclosed in the annexure at the end of this thesis.
ii) Secondary data collection
The secondary data was collected from the following sources: i) TRAI Publications and web sites and DOT Annual Reports .
6.9 Sample Plan
This research study required two samples. The detail is as follows:
For this study the CMSP who are providing mobile services in Mumbai for more than three years (in 2007), having a market share of more than 5% and more than 0.5 million customers is taken. Only six service providers Vodafone
Limited, Bharti Airtel, Reliance Infocom and Loop Mobile, Tata Tele services and Mahanagar Telephone Nigam limited as per the above criteria.
Table: 6.1 the market share of the CMSP in Mumbai as on May 2007.
S. Name of CMSP. Customer Market Share No in million 1 Hutchison Max. 2.59 26.5% (now Vodafone Limited) 2 Bharti Airtel 1.92 19.7%
3 Reliance Infocom 1.9 19.3% 4 MTNL Mumbai 1.51 15.48%. 5 BPL Mobile(now Loop Mobile) 1.08 11.22% 6 Tata teleservices Ltd 7.68 7.8% Total 9.78. 100%
Source: COAI, TRAI and AUSPI web sites for the month of May 2007,
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There were more than 10 million mobile customers in Mumbai in 2007, using the services of different CMSPs. A sample of Customers of the above six
CMSP is taken to study the customer perception, expectations and awareness and improvements in the TRAI guidelines. The sample is divided as per the market share of various service providers in a number of zones
(geographical areas). In this study a sample of 1360 customers proportional to the market share of the CMSP was taken which was distributed in Mumbai region.
Calculation of Sample Size
S= [z (p (1-P))]/ e2
For the Level of Significance of 95%, z = 2.576,
Proportion of the population to be sampled= 50%, then p= 0.5,
The proportion of error is 2%, them e= 0.02
Sample size = [2.576(0.3(1-0.3))]/ 0.0 2 *0.0 2 = 1352.4 = 1352 (taken 1360)
Table: 6.2 the sample size used in the study.
S. Name of CSMP Sample size No customers 1. Hutchison Max.(now Vodafone Limited) 365 2. Bharti Airtel 270 3. Reliance Infocom Limited. 257 4. Mahanagar Telecom Nigam Limited, Mumbai. 203 5. BPL Mobile. (now Loop Mobile) 149 6. Tata Teleservices Limited 116 Total 1360 Source: own calculations.
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Table 6.3 The Distribution of Sample in ten zones of MTNL. Area V B R M L T TOTAL 1. South 37 27 25 20 16 11 136 2. Central 37 27 25 20 16 11 136 3. North 37 27 25 20 16 11 136 4. West-I 37 27 25 20 16 11 136 5. West-II 37 27 25 20 16 11 136 6. West-III 37 27 25 20 16 11 136 7. East-I 37 27 25 20 16 11 136 8. East-II 37 27 25 20 16 11 136 9. N- Mumbai 37 27 25 20 16 11 136 10 Kalyan 37 27 25 20 16 11 136 . Dombivili TOTAL 370 270 250 200 160 110 1360 Source: own calculations
LEGEND R-Reliance Infocom Infocom–Bharti Airtel, T- Tata Teleservices limited, L-Loop Mobile(old name BPL), V-Vodafone limited (Hutch), M- Mahanagar Telephone Nigam Limited Mumbai.
6.10 Research Tools and Techniques.
The following research tools and techniques are used for data collection and analysis.
i) Personal interviews and structured questionnaires.
ii) Reference to the libraries.
iii) Opinion tools, econometric tools and statistical tools.
In the present research the service gaps between the expectations and perceptions are analyzed using the modified SERVQUAL102 scale. The analytical hierarchy model103 (AHP) is used for comparative analysis of the
CMSPs.
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6.11 Scope of the Study
There is a vast scope to undertake urgent research work in the functional area of customer services marketing provided by the CMSPs in Mumbai region.
The following functional areas of customer service will be reviewed.
i) Product
ii) Place.
iii) Promotion.
iv) Price.
v) Physical Evidence
vi) People and Processes.
It would be appropriate to study the trends of the telecom industry right from its inception in general. A focused study will be carried out from seven years from 2004 to 2011.
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Chapter -VII Measurement of Service Quality and Customer Expectation
7.1 Introduction
7.2 Selection of Measurement Scale
7.3 Validation of the Modified Scale
7.4 Measurement of the Customer Perceptions
and Expectations
7.5 Comparative Analysis of the Customer
service
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Chapter -VII Measurement of Service Quality and Customer Expectations
7.1 Introduction
This chapter deals with the measurement of the quality of customer service quality against telecom regulatory authority of India (TRAI) and the customers’ expectations. In order to develop a valid service quality measurement scale the SERVQUAL model was reviewed. A qualitative study was done to review all dimensions of service quality in context of cellular mobile service. The guidelines of the telecom regulatory authority of India (TRAI) were also included. A questionnaire, comprising of open-ended questions was used to validate the scale. The officers and staff of the customer care unit were also involved in the study. The following was the focus of the study
i) Selection and validation of a measurement scale for service quality.
ii) Customer’s awareness about TRAI and its functions.
iii) Customer’s awareness about service quality survey done by TRAI.
iv) Customer’s awareness about the QoS results published in the
media.
v) Measure customer’s perceptions of service quality in cellular mobile
service.
vi) Measure customer’s expectations.
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vii) Find Gaps between the perception and expectations.
7.2 Selection of Measurement Scale
The respondents provided valuable insights regarding the service quality measures and key factors impacting their perceptions. After an open discussion a consensus emerged towards inclusion of three new dimensions for measurement of service quality. In addition to existing five dimensions three new dimensions the network quality, value added services and innovations were included. The interviewed respondents also agreed that these three dimensions also affect the overall service quality. In all, eight dimensions namely Reliability, Responsiveness, Assurance, Empathy,
Tangibles, Network quality, value added services and Innovation were identified for measuring service quality in cellular mobile service.
Table 7.1 the five items of Reliability (P).
SNo Reliability Details of the items 1. Reliability(p1) Delivers promised service in time. 2. Reliability(p2) Takes sincere effort in solving complaints. 3. Reliability(p3) Performs the service right first time. 4. Reliability(p4) Provides the correct billing information in time. 5. Reliability(p5) Keeps informed when services will be performed. Source SERVQUAL questionnaire
The questionnaire consisting of 28 items was developed from the inferences obtained through the review. For the assessment of network as perceived by customers, four items were included in the questionnaire, whereas two items were included in the case of innovation and value added services. All the
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dimensions were measured based on customer perceptions. This confirms to study done by (Boulding, et al., 1993; Babakus and Boller), 1992).
Table 7.2 the four items of Responsiveness (Q).
SNo Responsiveness Details of the items 1. Responsiveness(q1) Provide prompt services 2. Responsiveness(q2) Always willing to help. 3. Responsiveness(q3) Queries taken seriously.
4. Responsiveness(q4) Never too busy to respond.
Source SERVQUAL questionnaire
Table 7.3 the four items of Assurance (R)
SNo Assurance Details of the items 1. Assurance(r1) Instills confidence in you. 2. Assurance(r2) Safe while transacting business. 3. Assurance(r3) Providers consistently courteous. 4. Assurance(r4) Knowledge to answer the customer’s questions. Source SERVQUAL questionnaire
Table 7.4 the four items of Empathy(S)
SNo Empathy Details of the items 1. Empathy(s1) Easily accessible. 2. Empathy(s2) Gives individual attention. 3. Empathy(s3) Have best interest of customer. 4. Empathy(s4) Understand your specific needs. Source SERVQUAL questionnaire
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Table 7.5 the three items of Tangibles (T)
SNo Tangibles Details of the items
1. Tangibles(t1) Modern looking equipment. 2. Tangibles(t2) Pamphlets or statements visually appealing.
3. Tangibles(t3) Convenient business hours.
Source SERVQUAL questionnaire Table 7.6 the four items of Network Quality (NQ).
SNo Network quality Details of the items 1. Network quality(nq1) Provides proper network Coverage. 2. Network quality(nq2) Network support voice calls of acceptable quality. 3. Network quality(nq3) Easily reachable. 4. Network quality(nq4) Meets the promised SLA. Source research findings
Table 7.7 the two items of Value added services (VAS)
SNo Value added Details of the items services 1. (vas1) Adequate customization for the VAS. 2. (vas1) The billing is correct and done in time. Source research findings
Table 7.8 the two items of Innovation (INNOV) SNo Innovations Details of the items 1. Innov1 Provides innovative services. 2. Innov2 Provides innovative tariff plans.
Source research findings
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7.3 Validation of the Modified Scale
A Pilot study was done with a small sample size of 150 to clarify the overall structure of questionnaire. The respondents provided comments on clarity of all items and confirmed face validity of items in the questionnaire. To confirm this quantitatively, corrected item-to-total correlation was done which was found greater than 0.4 which is considered acceptable (Nunnally, 1978).
Hence all twenty eight items were chosen. A sample from the customers of the six service providers was taken to study the customer perception, expectations and awareness and improvements in the TRAI guidelines. The sample is divided as per the market share of various service providers in a number of zones (geographical areas)
The questionnaire was divided into parts to simplify the study:
i) Part one aimed to collect the demographic characteristics of the
respondents.
ii) Part two of the questionnaire aimed to collect the data related to
the customer’s survey whether the CMSP are meeting the TRAI
parameter. It contained questions about the customer’s
awareness about functions of TRAI, customer’s awareness
about QoS survey conducted by TRAI, customer’s awareness
about the QoS results published in the media and Key factors
influencing the customer’s perceptions of service quality in
cellular mobile services.
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iii) Part three of the questionnaire aimed to collect the data related
to the perception and the expectations of the customer.
iv) Part four of the questionnaire aimed to collect the data related to
the comparison of the seven Ps of the services marketing to
analyse the quality of the customer services provided by the
CMSPs in the Mumbai Region.
As part of the data collected for this study, the demographic profile of the respondents was also collected as various demographic variables like age, gender, education level; income level, occupation etc. may have impact on the perception of service quality by the customers. The details are available in the Annexure.
Table: 7.9 the details of the Questionnaires.
Sno Particulars Number Percentage 1 Total distributed 1360 100 2 Lost 122 8.9 3 Not useful 163 12% 4 Valid 1075 79.1% Own calculation
For the present study the demographic profile of the customers included age, gender, educational qualification, employment status, household monthly income. The collected data was analyzed using various statistical techniques.
In total 1360 questionnaires were used for the survey, out this 122 were not returned by the customers, it was found that 163 were not filled properly by the respondents. The valid 1075 responses were used for data analysis. The general findings were:
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i) It was found that 37.31% of customers are using services of more
than one CMSP. ii) The network coverage and tariff were the most important factors in
selecting the CMS. iii) The friends and family play a major role in selecting the cellular
mobile service provider (CMSP). iv) The SIM cards and the recharge coupons are available in
abundance. The CMSP are offering customer service which is well
equipped and located at convenient locations. All the CMSP
providers offer sachet pricing. v) CMSPs are retailing the services through various outlets like
company stores, franchise, distributor, direct sales agents,
telemarketing websites and pop and mom stores. vi) The Vodafone is the only operator who provides 24 X 7 stores and
vending machines. The MTNL out lets are available only on the
working days between 8 am to 8 pm. The activation of the new
connection was within 6 hrs for all the CMSPs, where as there was
delay in the case of MTNL and the delay was some times more
than 48 hrs. vii) All cellular mobile service providers (CMSP) have the infrastructure
for registering the complaints but the first time resolution was 79%.
The service level agreement (SLA) is not promised in the customer
agreement form (CAF). viii) All cellular mobile service providers (CMSP) are prompt in
dispatching bills and collecting the payments except MTNL.
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ix) The website of all the operators except MTNL was found to be
customer friendly.
x) It was a surprise that 44.13% of the customers are not aware about
TRAI, 37% are not aware about the functions of TRAI. When TRAI
QoS parameters were shown to customers 74% of them were
unable to understand and 85% are not aware about TRAI reports.
Step 1: Testing the reliability of the scale
The Cronbach’s alpha test was done to measure internal consistency among the scale items. The alpha values for all dimensions of the scale were calculated. The alpha values for each of the dimensions and for the overall data are tabulated below:
Table 7.10 Factor loadings and Alpha for the proposed scale. SNo Item ID Item description Factor Alpha loading 1. Reliability(p1) Delivers service in time. 0.71 0.81 2. Reliability(p2) Takes sincere effort in 0.65 solving complaints. 3. Reliability(p3) Performs service right first 0.76 time. 4. Reliability(p4) Provides the correct billing 0.81 information in time. 5. Reliability(p5) Keeps informed when 0.86 services will be performed. Source survey findings
The alpha values for the individual dimensions as well as for the overall data were found acceptable, more 0.5, indicating good consistency.
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Table 7.11 Factor loadings and Alpha for the proposed model. SNo Item ID Item Factor Alpha description loading 1. Responsiveness(q1) prompt services 0.81 0.73 2. Responsiveness(q2) Always willing 0.79 to help. 3. Responsiveness(q3) Queries taken 0.74 seriously. 4. Responsiveness(q4) Never too busy 0.80 to respond. Source: survey findings
Table 7.12 Factor loadings and Alpha for the proposed scale. Item ID Item description Factor Alpha SNo loading 1. Assurance(r1) Instills confidence. 0.44 0.79 2. Assurance(r2) Safe while 0.75 transacting business. 3. Assurance(r3) Providers courteous. 0.83 4. Assurance(r4) Have the knowledge 0.78 to answer questions. Source: survey findings
Table 7.13 Factor loadings and Alpha for the proposed scale. Sno Item ID Item description Factor Alpha loadings 1. Empathy(s1) Easily accessible. 0.52 0.76 2. Empathy(s2) Individual attention. 0.69
3. Empathy(s3) Have best interest of 0.71 customer. 4. Empathy(s4) Understand your 0.83 specific needs. Source: survey findings
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Table 7.14 Factor loadings and Alpha for the proposed model. SN Item ID Item description Factor Alpha o loadings 1. Tangibles(t1) Modern Equipment. 0.71 0.68 2. Tangibles(t2) Pamphlet appealing. 0.70
3. Tangibles(t3) Convenient business hrs. 0.65
Source: survey findings
Table 7.15 Factor loadings and Alpha for the proposed scale. SNo Item ID Item description Factor Alpha loading 1. Value added Customization for the 0.734 0.77 services(vas1) value added services. 2. Value Added The billing is correct 0.871 services(vas2) and done in time. Source: survey findings Table 7.16 Factor loadings and Alpha for the proposed scale. Sno Item ID Item description Factor Alpha loadings 1 Network Provides proper 0.73 0.79 quality(nq1) network Coverage. 2 Network Support voice calls of 0.84 quality(nq2) acceptable quality. 3 Network Easily reachable. 0.82 quality(nq3) 4 Network Meets the promised 0.65 quality(nq4) SLA. Source: survey findings
Table 7.17 Factor loadings and Alpha for the proposed scale. Sno Item ID Item description Factor Alpha loading
1. Innov1 Provides innovative services. 0.867 0.85
2. Innov2 Provides innovative tariff 0.753 plans. Source: survey findings
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Step 2: Factor Analysis
The factor analysis was done to reduce a large number of variables into less number of factors. The number of the factors was determined by the Eigen values. If the Eigen value is greater than one, the factor is considered; if it is less than one then the factor is not considered. The appropriateness of factor analysis was assessed by examining sampling adequacy through Kaiser-
Meyer-Olkin (KMO) statistic. In all the cases the value was found more than
0.5 which is acceptable.
Table: 7.18 the Measurement of the Sampling adequacy
Sno Particulars 1 Kaiser- Meyer-Olkin (KMO) statistic. 0.789 Source survey findings
Step 3: Principal Component Analysis (PCA)
The items in the respective category were individually subjected to Principal
Component Analysis (PCA) using SPSS software with Varimax rotation and
Kaiser Normalization. The items having factor loadings less than 0.5 were eliminated (Hair et al., 2005). Finally, eight factors comprising twenty-eight items, all having Eigen values of unity and above were extracted. Further, in order to assess the appropriateness of the data for factor analysis, the communalities derived from the factor analysis were reviewed. These were all relatively large (greater than 0.5), suggesting that the data set is appropriate
(Stewart, 1981). The individual dimensions of the proposed instrument explained total variance exceeding 60 per cent, suggesting the appropriateness of the process.
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Step 4: Confirmatory factor analysis (CFA)
The CFA test was done to confirm unidimensionality of the scale. There are three important validity tests to test the measurement instrument content, construct and criterion related validity. The content validity of a construct is the degree to which the measure spans the domain of the construct theoretical definition. In the present study, the content validity of the instrument was ensured as the new dimensions and items were identified from the literature were reviewed. In order to check for unidimensionality, a measurement model was specified for each construct and CFA was run for all the constructs, Individual items in the construct. A comparative fit index (CFI) of 0.90 or above implied that there is a strong evidence of unidimensionality
(Byrne, 1994). The values obtained for all is equal to or above 0.90.
Step 5: Validation Analysis
After ascertaining the unidimensionality and reliability of the scale is
Established, it was further subjected to validation analysis (Ahire, Golhar and
Waller, 1996). The Convergent validity can be established using a coefficient called Bentler-Bonett coefficient. Scale with values of 0.90 or above shows strong evidence of convergent validity (Bentler and Bonett, 1980).The values for the Bentler-Bonett coefficient are summarized for eight dimensions. All the dimensions have a value of more than 0.90, thereby demonstrating strong convergent validity. The instrument to measure service quality (SQ) asked the respondent’s perception about their level of agreement with respect to 28 items for SQ, each on a seven point Likert scale.
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The, criterion validity is established by correlating the customer perceived service quality scale scores with overall service quality, which is considered to be the outcome construct. Table 7.19 CFI of the scale
SNo Factors Comparative Bentler Goodness of fit Fit Bonett Index(CFI) Coefficient 1 Reliability 0.98 0.99 0.972 2 Responsiveness 0.99 0.96 0.98 3 Assurance 0.94 0.93 0.95 4 Empathy 0.96 0.92 0.96 5 Tangibles 0.90 0.91 0.90 6 Network 0.96 0.91 0.90 7 VAS 0.96 0.93 0.97 8 Innovation 0.92 0.93 0.97 Source survey findings
The correlations are presented above which shows that all the dimensions have significant positive correlations with overall service quality. Thus, criterion related validity is established for all the dimensions.
Table 7.20 Correlations among dimensions.
SNo Dimensions Overall service quality 1. Reliability. 0.439
2. Responsiveness 0.618
3. Empathy. 0.446
4. Assurance. 0.327
5. Tangibles. 0.243
6. Network Quality. 0.410
7. Value-Added services. 0. 527
8. Innovation. 0.571 Source research findings
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It is clear that the correlation coefficient of all the three new dimensions network quality, value added services and innovation with overall service quality was found significant at 0.410, 0.527 and 0.571 respectively.
Step 6: Relative Importance of Service Quality Dimensions
In order to determine the relative importance of eight service quality dimensions, they were subjected to regression analysis. The respondents overall judgment of service quality was considered as dependent variable and the eight service quality dimensions were made independent variables. Thus, the average score for each of the dimensions were regressed on the overall service quality score obtained from each respondent surveyed. The beta (β) coefficients provided the relative importance.
Table 7.21 Regression analysis for relative importance of Dimensions Independent Beta Importance S No Variable (β) 1. Reliability 0.350 2 2. Responsiveness 0.244 4 3. Assurance 0.040 8 4. Empathy 0.177 6 5. Tangibles 0.202 5 6. Network 0.431 1 7. Value Added services 0.324 3 8. Innovation 0.212 7 Source research findings
The network dimension with the largest coefficient was found to be the represents the most important dimension in terms of its influence on overall quality perceptions. The Assurance dimension was rated least. The results of multiple regression analysis is summarized in Table 7.22 and it is observed that the overall regression model is significant (F=23.95, p<0.00), with 57% of
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the variance in overall service quality explained by independent variables. All the factors were found to be significant. The results of the regression analysis are very useful for the CMSP, it was highlighted that not all the dimensions contribute equally to the customers perceptions of service quality in cellular mobile context. These results can be used for making improvements in the quality of customer service.
7.4 Measurement of Customers Perception and Expectations
The perceptions and the expectations of the customer were collected with the help of the Questionnaire for all the items of the eight dimensions
Table 7.22 Expectations, perception and Gap score for Reliability. SNo Dimension item Expectation Perception Gap Score Score 1. Reliability (p1) 6.24 4.97 -1.27 2. (p2) 6.35 4.96 -1.39 3. (p3) 5.63 4.75 -0.88 4. (p4) 6.16 5.03 -1.13 5. (p5) 5.82 5.05 -0.77 Average=(P1+P2+P3 P 6.04 4.92 -1.12 +P4+P5/5) Source: research findings
Table 7.23 Expectations, perception and Gap score for Responsiveness. SNo Dimension Item Expectation Perception Gap 1. Responsiveness (q1) 5.98 4.94 -1.03 2. (q2) 5.96 5.01 -0.94 3. (q3) 6.01 5.14 -0.87 4. (q4) 5.56 4.40 -1.16 Average=(q1+q2+ Q 5.8 4.87 -0.93 q3+q4/4) Source: research findings
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Table 7.25 Expectations, perception and Gap score for Assurance. SNo Dimension Item Expectation Perception Gap 1. Assurance (r1) 5.60 4.72 -0.88 2. (r2) 6.30 5.65 -0.64 3. (r3) 6.29 5.33 -0.96 4. (r4) 5.80 4.82 -0.98 Average=(r1+r2+r3 R 5.99 5.13 -0.86 +r4/4) Source: research findings
Table 7.26 Expectations, perception and Gap score for Empathy. SNo Dimension Item Expectation Perception Gap 1. Empathy (s1) 4.88 4.19 -0.68 2. (s2) 5.21 4.96 -0.25 3. (s3) 5.12 4.43 -0.69 4. (s4) 5.53 4.47 -1.06 Average=(s1+s S 5.18 4.51 -0.66 2+s3+s4/4) Source: research findings
Table 7.27 Expectations, perception and Gap score for Tangibles. SNo Dimension Item Expectation Perceptio Gap n 1. Tangibles (t1) 5.48 5.23 -0.25
2. (t2) 5.52 4.98 -0.54 3. (t3) 5.42 5.11 -0.31 Average=(t1+t2+t3/3 T 5.47 5.10 -0.36 ) Source: research findings
Table 7.28 Expectations, perception and Gap score for Network quality. SNo Dimension Item Expectation Perception Gap 1. Network quality (nq1) 6.12 5.16 -0.96 2. (nq2) 5.98 5.67 -0.31 3. (nq3) 5.80 4.83 -0.97 4. (nq4) 5.21 4.99 -0.22
Average=(nq1+nq2+ NQ 5.77 5.16 -0.61 nq3+nq4)/4 Source: research findings
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Table 7.29 Expectations, perception and Gap score for VAS. SNo Dimension Items Expectation Perception Gap 1. VAS (vas1) 5.43 4.47 -0.96 2. (vas2) 5.45 4.87 -0.58 Average=(vas1+va VAS 5.44 4.67 -0.77 s2/2) Source: research findings
Table 7.30 Expectations, perception and Gap score for Innovation. SNo Dimension Item Expectation Perception Gap 1. Innovation Inov1 5.94 4.65 -1.29 2. Inov2 6.47 5.68 -0.8 Average=(Inov1+I INOV 6.20 5.16 -1.04 nov2/2) Source: research findings
According to Parasuraman et al., (1988), overall service quality is measured by obtaining an average gap score of the SERVQUAL dimensions. It was suggested that when the perceived service quality is high, then it will lead to increase in customer satisfaction. He supported the fact that service quality leads to customer satisfaction and this is in line with Saravana and Rao
(2007, p436) and Lee et al., (2000, p226) acknowledge that customer satisfaction is based upon the level of service quality provided by the CMSP.
A higher perception also indicates higher satisfaction as service quality and satisfaction are positively correlated (Fen & Lian 2005, p59-60). This means that the dimensions with the higher perception scores depict higher satisfaction on the part of customers and lower perception score depict lower satisfaction. The expectations are higher than the perceptions. The negative gaps indicate that customers expect more than what is offered by the CMSP
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in Mumbai region. The mobile customers perceive service quality lower than the expectations and hence they are not satisfied. The service quality is an antecedent of customer satisfaction, which was proven by Negi et al., (2009).
It means that since customers perceive service quality as low or poor and therefore implies that consumers are not satisfied with the services offered by
CMSP in Mumbai.
According to Parasuraman et al., (1998) overall service quality is measured by obtaining an average gap score of the servqual dimensions. In order to evaluate overall service quality as perceived by the mobile customers, we added three additional items to the five existing items. This is in line with
Gronroos, 1982 who proposed two main dimensions of service quality functional and technical. The gap was calculated for all the eight dimensions.
The results are given in tables 7.24 to 7.31. The overall gap between the perceptions and the expectations was found negative.
The overall average gap score for all the eight dimensions = - 0.793.
The items with the expectations more than six are Reliability (6.24, 6.35, 6.16 and 6.04), Responsiveness (6.01), Assurance (6.30 and 6.29), Network
Quality (6.12) and Innovation (6.47). The items with the perception scores more than five are Reliability (5.03 and 5.05), Responsiveness (5.01 and
5.14), Assurance (5.65, 5.33 and 5.13), Tangibles (5.23, 5.11 and 5.10),
Network (5.16, 5.67 and 5.16) and Innovation (5.68 and 5.10).
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Table 7.31 Descriptive statics for the eight dimensions of service quality
S Dimension Mean Median Mode Std. skew Kurtosis N Deviation 1 Reliability -1.09 -1.00 -0.20 1.12 -0.676 0.891 2 Responsiveness -1.00 -0.75 -0.75 1.18 -1.00 0.98 3 Assurance -0.86 -0.75 -0.50 1.11 -0.74 0.84 4 Empathy -0.68 -0.60 -1.00 1.22 -0.95 1.26 5 Tangibles -0.62 -0.50 -0.25 1.057 -0.136 0.22 6 Network -0.72 -0.34 -0.34 1.21 -0.256 0.76 7 VAS -0.77 -0.56 -0.21 1.13 -0.43 0.65 8 Innovation -0.89 -0.54 -0.45 1.21 -0.54 0.91 Source survey findings
The gap scores give an idea about the QoS provided by the CMSP. It is seen form the results above that the gap is always found to be negative and it proves the null hypothesis that the customers in Mumbai are not meeting the
TRAI parameters and the customer’s expectations.
A statistical analysis was done for all the eight dimensions of the service quality. The results are discussed in the following pages
Reliability (P)
The value of mean for the reliability criteria is -1.091 and the median is -1.00.
The mode score is -0.20. The standard deviation is 1.12 indicating the spread of gaps away from the mean. The distribution is positively skewed with a skewness of -0.676 which indicates that the figures are deviated more to the right. The kurtosis value is 0.891 which mean that there is clustering somewhere away from the mean.
Responsiveness (Q)
The value of mean for the responsiveness criteria is -1.0 and the median is -
0.75. The mode score is 0.75. The standard deviation is 1.18 positively indicating the spread of gaps away from the mean. The distribution is positively skewed with a skewness of -1.00 which indicates that the figures
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are deviated more to the right. The kurtosis value is 0.98 which mean that there is clustering somewhere away from the mean.
Assurance (R)
The value of mean for the assurance criteria is -0.86 and the median is-0.75.
The mode score is-0.50. The standard deviation is 1.11 indicating the spread of gaps away from the mean. The distribution is positively skewed with a skewness of -0.74 which indicates that the figures are deviated more to the right. The kurtosis value is 0.84 which mean that there is clustering somewhere away from the mean.
Empathy(S)
The value of mean for the empathy criteria is -0.68 and the median is -0.60.
The mode score is -1.00. The standard deviation is 1.22 indicating the spread of gaps away from the mean. The distribution is positively skewed with a skewness of -0.95 which indicates that the figures are deviated more to the right. The kurtosis value is 1.26 which mean that there is clustering somewhere away from the mean.
Tangibles (T):
The value of mean for the tangibles criteria is -0.62 and the median are -0.50.
The mode score is -0.25. The standard deviation is 1.057 indicating the spread of gaps away from the mean. The distribution is positively skewed with a skewness of -0.136 which indicates that the figures are deviated more to the right. The kurtosis value is 0.226 which mean that there is clustering somewhere away from the mean.
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Network (NQ)
The value of mean for the network criteria is -0.72 and the median is -0.34.
The mode score is -0.21. The standard deviation is 1.13 indicating the spread of gaps away from the mean. The distribution is positively skewed with a skewness of -0.256 which indicates that the figures are deviated more to the right. The kurtosis value is 0.76 which mean that there is clustering somewhere away from the mean.
Value Added services (VAS)
The value of mean for the value added service criteria are -0.77 and the median is -0.56. The mode score is -0.21. The standard deviation is 1.13 indicating the spread of gaps away from the mean. The distribution is positively skewed with a skewness of -0.43 which indicates that the figures are deviated more to the right. The kurtosis value is 0.65 which mean that there is clustering somewhere away from the mean.
Innovation (INV)
The value of mean for the innovation criteria is –0.89 and the median are -
0.54. The mode score is-0.45. The standard deviation is 1.21 indicating the spread of gaps away from the mean. The distribution is positively skewed with a skewness of -0.54 which indicates that the figures are deviated more to the right. The kurtosis value is 0.91 which mean that there is clustering somewhere away from the mean. It can be seen from the table 7.31 that the standard deviation score is fairly consistent which indicate that all the dimensions suggested a wide range of opinion on service quality among the respondents surveyed.
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7.5 Comparative analysis of the Customer Service
In order to make a comparative analysis of the cellular mobile services provided by the CMSP in Mumbai region, a detailed questionnaire was circulated to find out which area of the customer service marketing is important from the customers point of view. The response was called for all the seven Ps of marketing that is Price, Product, Place, Promotion, Physical evidence, People and Processes. Out of the seven Ps of customer services marketing Product, Promotion, Price, and Physical evidence were found to be the parameters contributing to the quality of customer services. In order to do a comparative study and rank the Cellular Mobile service Providers on the above four parameters Analytical hierarchy model was selected. An initial matrix is made putting the entire four matrix on the rows and columns in which all the principal diagonal entries are 1, as each factor is important as itself.
Table: 7.32 Comparisons Matrix
SNo Factor Promotion Network Price Physical Evidence 1 Promotion 1 1/5 1/3 ½ 2 Network 5 1 2 4 3 Price 3 ½ 2 3 4 Physical 2 ¼ 1/3 1 evidence Total 11 1.95 3.66 8.5 Source research findings
In the next step is the calculation of a list of the relative weights, importance, or value, of the factors, such as price and promotion all other three factors.
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Table 7.33 showing the values of Eigen vectors after normalization.
S Factor Promotion Network Price Physical Avg. N Evidence o 1. Promotion 0.091 0.102 0.091 0.5 0.086 2. Network 0.455 0.513 0.545 0 0.496 3. Price 0.273 0.513 0.273 0.353 0.289 4. Physical 0.182 0.128 0.091 0.118 0.130 evidence 5. Total 11 1.95 3.66 8.5 1.0 0.0911 0.5128 0.273 0.117 1.817 Source research findings
The Eigen values obtained are (0.086, 0.496, 0.289 and 0.130) these indicate the relative values of the Promotion, network, Price and physical Evidence. As per the above analysis the weights of various factors are as follows:
Table 7.34 The weight age of factors
SNo Parameter Weight in percentage 1 Promotion 8.6% 2 Network 49.6% 3 Price 28.9% 4 Physical evidence 13% Total 100% Source research findings
Out of the above four factors the network quality 49.6% is the most important for the customers, the price 28.9% is the second important factor. Physical evidence 13% is the third important factor and promotions 8.6% is the least important factor.
A six sets of pair wise comparisons how well Reliance Infocom, Bharti Airtel,
Vodafone limited, Mahanagar Telephone Nigam Limited, Loop Mobile and
Tata Teleservices limited perform in terms of the promotion, network, price and physical evidence was obtained from the customers.
In order to analyze the quality of the services provided by the CMSP in
Mumbai the customers perception was taken on promotion, physical
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evidence, network quality and price. The result was multiplied with the % weight age of the four factors. The detailed analysis using the AHP about the
Price, Network quality, Physical evidence and Promotions is done in chapters
VIII, IX,X and XI respectively.
The matrix given below is called Option Performance Matrix; it summarizes the respective performance of the Cellular Mobile Service Provider (CMSP) in terms of the promotion, Price, Promotion and physical evidence which are important for the customer. Reading down each column, it somewhat states the Reliance Infocom is best in the network quality and MTNL is worst, the services of the Tata Teleservices limited are cheapest and MTNL. The promotion of the MTNL is found to be the best and worst for Tata Tele services. The physical evidence is best for MTNL and worst for Bharti Airtel.
In the final step the customer’s judgment as to the relative importance of the
Price, promotion, physical evidence and network net work 49.6, promotion
8.6, price 28.9% and physical evidence 13% is multiplied with the option performance matrix (OPM) to obtain the Relative Value vector.
Table: 7.35 the option performance matrix of the CMSP.
SNo Factor R B T L V M 1. Network 0.25 0.19 0.15 0.17 0.19 0.06 2. Price 0.12 0.18 0.06 0.17 0.22 0.26 3. Promotion 0.07 0.24 0.06 0.13 0.19 0.27 4. Evidence 0.13 0.2 0.09 0.14 0.19 0.24 Source research findings
Legend R-Reliance Infocom Infocom–Bharti Airtel, T- Tata teleservices limited, L- Loop Mobile(old name BPL), V-Vodafone limited (Hutch), M-Mahanagar Telephone Nigam Limited Mumbai
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Calculation of the Ranking of Cellular Mobile Service Providers
Table: 7.35 the relative value vector for four factors.
SNo Factor R B T L V M 1 Network 0.12 0.09 0.07 0.06 0.90 0.03 2 Price 0.03 0.05 0.02 0.05 0.06 0.06 3 Promotion 0.01 0.03 0.01 0.02 0.02 0.04 4 Evidence 0.01 0.02 0.01 0.01 0.02 0.02 0.18 0.19 0.11 0.16 0.20 0.16 Source survey finding
The relative value vector is used to calculate the ranking of the Cellular Mobile
Service Providers in Mumbai region. The summary of the findings is discussed on the next page.
Findings on ranking
i) As per the above parameters Vodafone limited is ranked first, Bharti
Airtel is ranked second, the difference between the rating of the
Vodafone and Bharti is very less.
ii) Reliance Infocom is ranked third, Loop Mobile telecom and MTNL
are ranked fourth and Tata Teleservices is ranked last.
iii) It can be seen that the CMSP ranked first and second are GSM
where as the last is a CDMA operator.
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Chapter VIII Review of Price Management
8.1 Introduction
8.2 Pricing Approach of CMSP
8.3 Price Regulations
8.4 Price and Demand Elasticity
8.5 Cost of Provisioning CMS
8.6 Pricing of CMS
8.7 Role of TRAI in Pricing
8.8 Disruptive Pricing
8.9 Qualitative Analysis of Price for CMSPs.
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Chapter VIII Review of Price Management
8.1 Introduction
The Price is one of the most important aspects of the mobile services marketing mix104, which creates revenue whereas all the others are costs. The price of mobile service influences customer’s choice in the selection of cellular mobile service provider (CMSP). In order to take advantage of the lower tariff plans many customers are using two separate mobile connections of different
CMSP. The mobile service market in Mumbai is highly competitive and fragmented industry which has delivered low prices inspite of the high Minutes of Usage (MoU). Since the launch of the mobile services the call rates are falling. In 1995 at the time of launch of mobile service the cost of outgoing local call was Rs 16 per minute which now costs less than 1p/sec. The incoming calls were also billed. A high and low call rate was applicable for the peak and off peak hours.
The CMSP are permitted to offer a maximum of twenty five tariff plans at a time. It is mandatory to list the details of the tariff plans on their website. It was found that the CMSPs offer custom built tariff plans to postpaid corporate customers who are not listed. TRAI decides the price caps, floor price and interconnect charges from time to time. The price plays a vital role in telecom market especially for the cellular mobile service providers (CMSPs)
(Kollmann, 2000). There is positive relationship between price, service quality, availability, and promotional offer. It includes rental charges which are fixed
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and call charges which are variable. According to Kollmann (2000) the income for CMSP is dependent on the number of calls.
8.2 Pricing Approach of CMSP
The cellular mobile service providers (CMSP) are adopting cost based, market oriented and competition based pricing approach. The price is a very important element due to the following reasons:
i) The customers assume that more expensive service is of better
quality than cheaper competitive products.
ii) Image pose value means a high price to have prestige value.
iii) The customers resist a very high price on the other hand a cheap
price means low quality to them.
iv) The buyers require different price levels; good value for money is
achieved by offering a range of products within a certain price band.
India is one of the fastest growing mobile telecom markets in the world. It has large inequality in its income distribution with nearly a third of its national income being concentrated among the 10% of the rich. It is a real challenge to offer tariff plan which appeals to both high and low income customers. The average revenue per user (ARPU) of low income group customers is not sustainable and their count is more. All cellular mobile service providers
(CMSP) offer similar marketing mix and pursue a strategy of price- competition.
Another reason for a high degree of price competition is an early stage of the
Product Life Cycle (PLC) where low prices are offered to gain market share.
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The following objectives are followed by the cellular mobile service providers
(CMSP) in Mumbai for pricing the mobile services:
i) Profitability: The pricing approach of mobile service is such that the
profit is calculated based on the number of customers. Hence the
cellular mobile service providers (CMSPs) are focusing on building the
customer base.
ii) Market Share: The large market shares enable a firm to operate
cost-effectively, allow dictating the prices which weaker competitors
have to follow.
iii) Price Stability: All the CMSP offer similar tariff plans, which is a
popular objective of an oligopoly. Whenever one operator reduces the
price the same is matched by the competitors.
iv) Return on investment: The cellular mobile service providers
(CMSP) target to get back a certain proportion of the money invested.
8.3 Price Regulations
The telecom regulatory Authority of India (TRAI) issues regulations in the form of the TTO (Telecom tariff order) in order to guide the CMSP on the pricing, and the interconnect issues105. It interacts with all stake holders to promote efficiency and innovations. It also assists in competitive entry, combat abuse of market power and redistributes benefit amongst all the stake holders. The
Indian telecom sector has moved from full monopoly to full market system.
The main regulatory policy concern is to assure the universal availability of telecom services with reasonable rates, over the years, as competition
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has developed, regulators become more confident about the provision of different telecom services. Thus a gradual relaxation and withdrawal of some form of regulation has been introduced mainly to decide the price of the calls and other value added services.
The main measures taken by telecom regulatory authority of India (TRAI) to control price are;
i) Promotion of universal service targeting low-income households’ or
disabled persons and protection of user interests.
ii) Change in the industry structure and movement towards level
playing field and stimulation of innovations.
iii) Management of common resources effectively and stimulation of
investments in the public network and interconnection.
iv) Licensing, establishing and supervising technical and operational
standards and practices for network operations.
v) Overseeing the service quality provided and regulating the pricing
of telecom services.
vi) Setting the terms (administrative, financial and technical) for the
interconnection of different networks, including the access price
charged by one to another and controlling the numbering plan and
related matters.
8.4 Price and Demand Elasticity
In the past there was unsatisfied demand of telecom customers, due to two reasons. One, congestion in the network and two, there was excess demand
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from users who have not got linked to the network. There was a waiting list for telecom services. The systematic data was not maintained historically to compute the demand elasticity for telecom services in India. It was not possible to calculate the elasticity of demand or demand curve.
There was low demand elasticity, particularly for local calls and for access to the phone. In such a situation, a price increase would actually result in a rise in revenue, and not much fall in demand for the service. This is even more likely because of the excess demand and supply constraints that existed for telecom services in the past. The responsiveness of demand (or elasticity of demand) to a change in price is greater if the initial price is at a relatively high level. In the Indian situation, such a response could be expected for the relatively high priced services, particularly from those subscribers who are currently making only a few of these high priced calls. In the present scenario the telecom services are available at a very reasonable price and It is irrelevant to study demand elasticity now.
8.5 Cost of Provisioning CMS
The total costs incurred in offering the mobile service is equal to the sum of all fixed costs and variable costs; fixed costs are costs which do not vary with changes in the number of calls or the volume of traffic on the network; variable costs are costs which change with a change in volume of traffic. The operational costs are higher during the peak period. Therefore, not only demand but costs also provide a basis for charging higher prices for the peak period.
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8.6 Pricing of CMS
The price of mobile services is defined as a mark up on the cost; different criteria have been used to determine mark-up on telecom costs by the cellular mobile service providers in Mumbai.
8.6.1 Positive Mark Up
The mark up consists of return on capital or a risk-adjusted reasonable commercial return. In telecom an assured rate of return for any service increases the possibility for anti-competitive behavior. Another possibility is two part pricing which involves levying an access or rental charge while pricing the use of the service at its marginal cost, or pricing different levels or units of the service at different rates (slab rates).The India’s current pattern of tariff for mobile services includes a specified number of free calls and a positive tariff on all subsequent calls.
8.6.2 Negative Mark up
The negative mark up also called subsidies in telecom is provided for various reasons. They reflect considerations such as externalities, equity, and fairness. The provision of universal service or subsidized services to specific targeted users is covered under this category. The externalities in telecom arise because this sector is an important part of the economic and social infrastructure of a nation.
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8.6.3 Demand Based Pricing
The Demand-based prices provide a possibility of cross-subsidizing services with a relatively low price. While one example of demand-based price, involves a consideration of demand and costs, in general demand-based prices are determined independently of costs. A demand-based price reflects willingness of the user to pay for a service, which in turn is an indication of the advantage or value that the user derives from the product. Based on this principle, this pricing methodology focuses not on efficiency in terms of cost, but on efficiency in terms of the value given by a customer to a product.
The telecom regulatory authority of India (TRAI) has started giving telecom operators greater control to fix their prices. This flexibility has helped the
Cellular mobile service providers (CMSP) to develop suitable and innovative price structures for the mobile services. The price cap is a very flexible pricing methodology, and can be adjusted to take account of a variety of objectives related to telecom tariffs. An important reason for adopting price caps has been to facilitate the process of tariff restructuring, i.e. change the prevailing pattern of cross-subsidization among services. Though the price cap is relatively simple to administer and does not require detailed knowledge of an operator’s annual costs, the large number of telecom services in the market makes it difficult for regulators to intervene specifically for each individual service. The price caps for the mobile service are announced by telecom regulatory authority of India (TRAI) at regular intervals.
The current trends in India show higher level of competition in a market, the telecom regulatory authority of India (TRAI) has left the pricing of the voice calls and some data services to the market forces. The unfair competition is a
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major concern in the telecom sector, which normally has a dominant incumbent operator in the market. In order to address this it is sometimes argued that low introductory prices need to be offered for a new service. In such a situation, special care would need to be given to competition policy- related issues. Another concern regarding abuse of market power relates to a high price being charged to customers which happened when the mobile services were introduced. The price ceilings based on fully-allocated costs or stand-alone costs have been considered for addressing this concern. The
TRAI announces price ceilings for the roaming calls periodically.
A specific price level can be fixed on the basis of costs or demand.
Alternatively, a cost-based price could be determined together with a mark-up which might be based on demand or on some other criteria mentioned earlier.
An important point to consider in the context of subsidies to telecom is that if teledensity is very low (such as in India), there is likely to be a considerable positive network-externality when additional lines are installed. This would suggest that a lower price should be charged compared to a situation where such externalities do not exist, e.g. a situation where universal coverage has been achieved. Such externalities provide one of the reasons for focusing on universal services provision.
There are a number of methods to fund the deficit. The government of India has announced to collect funds from all cellular mobile service providers
(CMSP). The fund is credited to universal service obligation fund (USOF).
This fund is used to provide telecom services to the rural areas. The fund is allotted to the CMSP for improving the telecom infrastructure of the places where the teledensity is very low.
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8.6.4 Interconnect Charges
The interconnection is crucial to make it possible for the customers of two different CMSP to communicate with each other. It is essential for extending the scope and efficiency of the telecom network, and is especially important for new operators entering the market who normally use the existing facilities of another operator for providing their services. It is fundamental for a competitive market structure. It involves a linking up of one telecom operator to the infrastructure facilities of another. Interconnections can be considered in terms of network interconnection and access interconnection. The former takes place between operators possessing networks, and the latter between an operator with a network and another without one. Three broad types of interconnection are considered for policy purposes.
i) Connection to the Public Switched Telephone Network (PSTN) of
equipment on customer premises, of private telecom networks, or of
value-added networks.
ii) Connection of new fixed local networks or long-distance networks to
the PSTN.
iii) Connection of cellular networks or other wireless systems to the
PSTN, or of the satellite systems to the PSTN.
The interconnection charges include charges for collecting and delivering calls, for installing, maintaining and operating the points of interconnect payment for supplementary services and for ancillary and other facilities.
There are basically two methods for charging for interconnection. One is through sharing of revenues among the interconnected operators of telecom services. The second, who is more commonly used, is to establish
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interconnection charges on the basis of costs. In a cost-oriented interconnection regime, there is no sharing of revenues between carriers.
Instead, the operator from whom interconnection is purchased is paid for providing that interconnection.
In India the telecom regulatory authority of India (TRAI) encourage the operators to settle interconnection rates through negotiations. It establishes guidelines or a framework which they consider desirable for determining interconnection charges.
The interconnection is a key to a competitive market. A need to encourage efficiency in interconnection implies that interconnection charges should be based on costs. The cost based interconnection charges should incorporate a normal commercial return, and there should not be any discrimination among different operators, unless a cost-difference justifies dissimilar treatment. A number of different methodologies are used for fixing interconnection charges.
In India charges are imposed on a per-minute basis for the calls made.
8.7 Role of TRAI in Pricing
Historically telecom tariff was decided by the department of telecom (DoT), after 1997 the responsibility was passed to telecom regulatory authority of
India (TRAI). The cellular mobile service (CMS) tariff includes the following components: Security Deposit and registration fee, monthly rentals, charges for local calls (which are in excess of the relevant free calls basket, and charges for national and international calls. The national long-distance calls
(subscriber trunk dialing or STD) are metered and charged according to the
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time of call and the distance covered. The telecom regulatory authority of
India (TRAI) argued that cross-subsidies were unsustainable in a competitive environment and were resulting in an inefficient allocation of resources.
Therefore, the primary objective of the tariff review process was to rebalance tariffs and move them closer to costs.
In March 1999, the telecom regulatory authority of India (TRAI) issued its
Telecommunications Tariff Order (TTO), which aimed at re-balancing. It proposed an increase in rentals and local rates, and a reduction in long- distance rates.
It used Fully Allocated Costs (FAC) as a starting point. It attempted to cost the services by allocating all capital and operating costs across four categories rental, local calls, long distance and international calls. The analysis used a representative cost estimate for the current capital costs of the local network and long distance transmission network. Operating cost estimates were based on historical costs. The allocation of costs was based on estimates of the number of minutes of local, national and international calls as the real data was not available.
8.7.1 Restructuring Mobile Tariff
The current tariff structure for mobile telephony is set out in the TRAI’s Tariff
Order of March 1999. The Telecommunications Interconnection (Charges and
Revenue-Sharing) Regulation was enacted in May 1999 in order to deal with interconnection charges and revenue-sharing agreements. Amendments to the Interconnection Regulation in September 1999 attempted to introduce a
CPP (Calling Party Pays) regime, a new tariff structure and a new revenue
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sharing scheme between operators. This Amendment set the down ward trend in tariff rentals were also decreased for metro regions. The new structure also provided for free incoming calls, in line with the calling party pays (CPP) regime. It is the most common pricing structure for mobile communications, under which the mobile customer pays for outgoing calls, and the fixed customer also pays for calling the mobile network. The person initiating the phone call is responsible for the cost of each call. It was argued that calling party pays regime will make mobile services more affordable to low-end customers and increase airtime in both the prepaid and subscription low-usage end of the market.
8.7.2 Access Charges
In its second consultation paper, on Telecom Pricing (September 9, 1998), the telecom regulatory authority of India (TRAI) stated that interconnection charges apply to the link established between the two networks (set-up cost), and to the use of the interconnection provider’s network facilities (usage charges). It also stated that interconnection prices should, in general, be based on costs, and or charged in the form of revenue sharing between the interconnecting operators. It is in this context the first interconnection regulation was named, telecom regulatory authority of India (TRAI) was careful to specify that the revenue sharing arrangements were of an interim nature and not based on detailed cost analysis: application of an access/carriage charge regime will provide more logically tenable usage charges. It required that till any access/carriage charge is implemented, a system of revenue sharing must be in place to give effect to the commercial
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relationships arising through interconnection. In its second consultation paper on Telecom Pricing (September 9, 1998), the TRAI proposed a migration to the CPP regime. For mobile-to-mobile traffic, a ‘sender keeps all’ arrangement would exist. However, the TRAI felt that such a policy would not be appropriate in the case of fixed to mobile calls because of the asymmetric costs of the two networks. Hence, a migration to the CPP regime would have to be accompanied by a suitable interconnection policy. For fixed to mobile calls, the telecom authority of India (TRAI) proposed a charge of Rs. 3.90 per minute, with the revenue being shared between the fixed and mobile operator at a ratio of 15:85. This arrangement was based on two considerations:
i) At Rs. 3.90 per minute, the fixed to mobile charge would be about 9
times the fixed to fixed charge.
ii) A sharing of 15:85 would ensure that the fixed line operator
receives the same revenue as for a fixed to fixed call.
This Amendment mandated the payment of a mobile termination charge
(MTC) to the mobile operator of Rs.1.60 for the first minute and Rs. 0.80 for each successive minute. This represents a 33:67 % share between the fixed and mobile operators. This arrangement was temporary and was replaced the following year by a cost-based access charge. This preliminary methodology on evaluation mobile tariffs was formulated to evaluate the relative affordability of access of mobile telecommunication services.
The mobile tariffs are of significance because they are a good gauge of sector performance and affordability. In a number of studies, it was confirmed that price and value were the most important considerations for those choosing a mobile phone package. Affordable tariffs determined the use of a package
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and the amount of use thereafter. The study also proved that standardizing of tariffs was essential for the benefit of all stakeholders. The consumers complained about the lack of organization and consistency in the way tariffs were presented by different operators. They would like to be able to compare connection charges, monthly line rental, free call allowances, call charges and billing charges; and within call charges, they would like to be able to compare daytime rates, evening rates, weekend rates, peak/off peak times, rates to the same network, rates to different networks, voicemail rates, SMS rates and
WAP rates among others.
8.8 Disruptive Pricing
The cellular mobile service providers (CMSP) are offering a number of innovative tariff plans. It has created revolution in the market. Some popular plans are listed below: i) Life Time Scheme
Bharti Airtel was the first to announce the lifetime validity for incoming calls scheme from among the GSM players. The customer will have to pay Rs 999 to avail of the new scheme, following which the user can receive incoming calls ‘free for a lifetime’ on the condition that the user recharges the card once in every 6 months. The call charges were much higher than normal charges. ii) One India
The One India plan by launched by offered by Bharat Sanchar Nigam Limited,
Mahanagar Telecom Nigam Limited (MTNL) and RCOM in November 2006. It offered Re 1.00 tariff for STD calls anywhere in India from anywhere in India.
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The call charges remained untouched. This tariff was applicable in the home network only. iii) Per Second Billing
This was introduced by DoCoMo a franchise of Tata Teleservices Limited
(TTSL) in 2010, the local calls where charged at the rate of 1ps per second.
Later the STD calls in home network and roaming where also charged at 1ps per second. Mahanagar Telephone Nigam Limited (MTNL) immediately offered ½ ps per second the lowest tariff in India for local calls in their network. iv) Unlimited Plans
This was introduced by RELIANCE Infocom in May 2010 in three variants.
i) The Simply Unlimited CDMA Local Pack offered Reliance Infocom
customers unlimited local calling at a monthly recharge of Rs. 299. This
pack offers unlimited onnet free calls to any local Reliance Infocom
phone as well as virtually unlimited free local calls to any other
network.
ii) The Simply Unlimited CDMA National Pack offered Reliance
Infocom customers unlimited calling across the country for a monthly
recharge of Rs. 599 only. This Pack offers unlimited free calls to any
Reliance Infocom phone in India (Reliance Infocom GSM, CDMA or
Fixed Line) whether local or National.
V) “Dusk gang – Nxt Gen”
Loop Mobile (formerly BPL Mobile) offered bandwagon of
Gang/Group calling plans and introduced new more attractive gang
plan with free GPRS and lots of benefits for its existing and new
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prepaid mobile subscribers. With this plan Loop Mobile prepaid
subscribers can enjoy all local Calls within group will be charged at
just 10 paisa per minute till first 300 minutes every month.
vi) Chotta Recharge Coupons
Bharti Airtel has launched full talk time recharge coupon, named as
Chota Full Talk time Recharge.RC20 for Rs. 20 with full talk time of Rs.
20. The Chotta Recharge has offered many benefits like ability to
contact relatives and friends in distant places. It created a customer
base in Plumbers, Domestic helps, Car mechanics, Vegetable vendors
and Grocery vendors. In Southern India, it created a base among
fisherman’s to find the right price for their fishes among various sea-
shore fish markets before deciding to move any single market.
8.9 Comparative Analysis of Product (network) for CMSPs
In order the study the Comparative analysis for the product factor the response of the mobile customers in the sample region was taken by a questionnaire in which the response was requested by comparing the promotion of one CMSP with respect to the remaining five.
The AHP method was used for analysis. The values are given the Table 8.1 and 8.2
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Table: 8.1 the customer’s response on price
SNo R B T L V M 1 R 1.00 0.25 4.00 0.33 1.00 0.33 2 B 4.00 1.00 4.00 0.25 0.33 1.00 3 T 0.25 0.25 1.00 1.00 0.25 0.33 4 L 3.00 4.00 1.00 1.00 0.25 0.33 5 V 1.00 3.00 4.00 4.00 1.00 0.25 6 M 3.00 1.00 3.00 3.00 2.00 1.00 Total 12.2 9.50 17.00 9.58 4.83 3.24 0.08 0.11 0.06 0.10 0.21 0.31 Source survey findings
Legend R-Reliance Infocom Infocom–Bharti Airtel, T- Tata Teleservices limited, L-Loop Mobile (old name BPL),V-Vodafone limited (Hutch), M- Mahanagar Telephone Nigam Limited Mumbai.
Table: 8.2 Normalized Results obtained by multiplication with % weight
SNo R B T L V M Avg 1 R 0.08 0.03 0.24 0.03 0.21 0.10 0.12 2 B 0.32 0.11 0.24 0.03 0.07 0.31 0.18 3 T 0.02 0.03 0.06 0.10 0.05 0.10 0.06 4 L 0.24 0.44 0.06 0.10 0.05 0.10 0.17 5 V 0.08 0.33 0.24 0.40 0.21 0.08 0.22 6 M 0.24 0.11 0.18 0.30 0.42 0.31 0.26 0.98 1.05 1.02 0.96 1.01 1.00 1.00 Source survey findings, Legends same as table 8.1
Conclusions on the Comparative Analysis on Price for CMSP
i) The values for the price factor received for all the CMSP are almost similar (0.98, 1.05, 1.02, 0.96, 1.01 and 1.0). ii) The maximum value corresponds to Bharti Airtel limited and the lowest value belongs to Loop Mobile.
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Chapter -IX Review of Product Management
9.1 Introduction
9.2 Concept of Product in the Cellular Mobile
Service
9.3 Challenges in Developing New Products
9.4 Quality Function Deployments in Product
Development
9.5 Product Management
9.6 Product Mix in Cellular Mobile Services
9.7 Comparative Analysis of Network for CMSPs.
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Chapter -IX Review of Product Management
9.1 Introduction
Whenever the customer calls the first thing they ask is ‘What’s new?’ The new products, whether they take the form of new applications, innovations, or entirely new value added service, are an essential component of business success. In the present scenario ‘innovate or die’ has become a rallying cry as technology savvy consumers demand the latest and the best products. The speed to market factor has become perhaps the most critical factor in product development. The improved communication, increased globalization, and rapid changes in technology are putting great pressure on cellular mobile service providers (CMSP) to get their product to market first. They can succeed only if they have focused product line architecture. It tells how product line will look, what types of products in what markets, how they will be positioned, and in what sequence they will be introduced. After the product line architecture has been established and a new product is being developed; only effort required is to successfully launch the product in target market.
At this stage an advertising or public relations agency can come into play.
Once the CMSP creates its overall strategy and determines how it will target its customer, it can map out exactly what product lines it will choose to achieve that goal. The CMS is a service industry; a proper approach is a must for developing new services, relying on targeted customer inputs. If a customer feels they are getting better treatment, or more service options, or
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more free talk time or data download as part of their purchase, they are more likely to migrate. If CMSP stop innovating and adding new services to its core business, then the service becomes a commodity and clients look at only price when deciding on what to choose. The cellular mobile service provider
(CMSP) faces more pressure to innovate and develop new products. They can stay ahead of their competitors by innovations and make their services clearly identifiable to consumers.
The cellular mobile service providers (CMSP) have to pay attention to the needs of customers and offer them quality products or services which satisfy their ever increasing expectations. In order to compete and survive in the
Mumbai region the need of the hour is to improve the existing products. The customer satisfaction is based on the product’s performance relative to the customer’s expectations (Kotler and Armstrong 1999).
The satisfied customers only make repeat purchases. There is a need to analyze the customer’s expectations and the motive of the purchase in order to produce products which click in the market. Once these expectations are build in the design phase marketing department focuses on the advertisement to promote the products. In Mumbai region on an average between 2 to 4 new products are launched by the Cellular Mobile service providers (CMSP) every month. The products launched by one are immediately copied by the others.
The cellular mobile service provider (CMSP) who is slow in bringing new products loose the market and their customers migrate to the other providers.
The new services launched do not remain new for a long period. The product life cycle in cellular mobile services (CMS) industry is 8 to 16 weeks. Hence there is pressure to differentiate the products and gain the market share by
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accelerating the product development. The new products shall be ready before the old ones expire. The new products shall bring revenue to pull the bottom line up.
9.2 Concept of Product in Cellular Mobile Services
A product is anything that is potentially valued by a target market for the benefits or satisfactions it provi des, including objects, services, organizations, places, people and ideas. The
American Marketing Association states “A product is anything that can be offered to a market for attention, acquisition or consumption including physical objects, services, personalities, organizations and desires”.
The services are also product that consists of activities, benefits or satisfaction that are offered for sale. They are intangible and do not result in the ownership of anything. The product is viewed differently by different people, for the consumers, it is the bundle of perceived benefits that meets his needs, for manufacturers it is the bundle of attributes that ideally meet consumer needs, for the product manager it is the task for the advertising agency, it is the communication challenges; to the finance manager, it is a source of revenue. The product is the sum total of three things the Intrinsic characteristics, its materials and construction, its ability to perform; the extrinsic characteristics its packaging, brand or trade mark and the intangibles associated with it, like warranties, guaranties and after-sales service etc.
The product in the cellular mobile services (CMS) industry can be thought of a five levels of hierarchy. The most fundamental consists of the facility to
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communicate any where any time this is also called the core benefit, this is what the customer is really buying. The second level consists of the mechanism by which the customer can achieve the core benefits. In case of the cellular mobile services it consists of the radio frequency network, it is not possible to communicate without it.
The third level consists of the expected product, a set of attributes and conditions that customers normally expect and agree, in the case of the CMS it consists of an agreement between the customer and the cellular mobile service provider. Sometimes a bundled handset and free talk time and data down load are also offered. These features are offered by all the CMSP now.
The customer settles for the services which are easily available and least expensive.
At the fourth level the augmented product is offered to the customer which is customer’s desire and beyond their expectations. The CMSP offer a bundle of value added services in order to satisfy the customer. The competition today is not on the quality of the radio frequency coverage alone but what the CMSP are able to offer in the form of service advice, delivery and assistance in customizing the value added services on the customers hand set. At the fifth level called potential product which encompasses all the augmentations and transformations that the product might undergo. The CMSPs go an extra mile and provide value added products like mobile banking and e-commerce.
These features not only satisfy and surprise the customer but delight them.
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9.3 Challenges in Developing New Products
In the CMS market there exists only two major segments the postpaid services and the prepaid services. The majority of the customers in Mumbai region prefer prepaid services. The new products are developed keeping in mind the needs of the prepaid customers. The new products are offered mostly in sachet which cost between Rs. 4 to 100 this is an advantage for the customers and they can test the services before they subscribe it for one month or more.
In order to successfully manage the product development and launch the
CMSP have a team of product managers, new product managers, new product committees, new product departments and product venture teams.
This function is dealt by vice president level in most of the CMSP. The customer service department provides the voice of customer data (VoC), to the product team. The product development is done in following stages: i) Idea generation: the new product development starts with the search of new ideas the objectives of which are defined by the senior management it can be to produce a niche, improve an existing or counter the competitor’s product. The highest percentage of ideas comes from the group dealing in customer services. ii) Ideas screening: The ideas are collected by product champion and filtered by as per the business needs. While screening the ideas the CMSP take precautions to prevent DROP and GO errors in order to prevent the dismissal of a good idea and permit a poor to move into development and commercialization. A product failure occurs in both the cases out of the twenty
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five to thirty new products launched by the CMSP hardly three to four succeed. iii) Concept development: A number of products are developed on the concept of the ideas selected. The concept is derived from the product idea depending on who will be the user of the product the postpaid or the prepaid customer. The selected concept is customized in the Customer Resource
Module of the billing and customer care system. iv) Testing: The customized product is then tested by making test calls and data download. The charging is verified to eliminate the billing errors.
The product is offered to the test group who perform the acceptance testing of the product keeping the business plan as the benchmark. The new products continue to fail in the CMS market may due to pushing an idea in spite of the negative research findings or the idea is good but the market size is not estimated properly and lack of proper advertisement and promotion and development cost is higher than expected and the rivals copy the products quickly. Nowadays, Outsourced product development is taking as a vital ingredient of business concerns as it has the potential to take the companies to new heights. It has not picked up in the CMSP in Mumbai.
9.4 Quality Function Deployment in Product Development
The quality of the customer service plays an important role in fulfilling customer expectations, which in turn plays an important role in customer satisfaction. The total quality management (TQM) combines the above as a management technique. It aims to improve effectiveness, flexibility and
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competitiveness of the products. As per Juran customer satisfaction is achieved by fulfilling the customer expectations which results in more market share and sales income. The quality function deployment (QFD) is the basic total quality management (TQM) tool that develops customer’s needs and expectations and translates them into technical requirements. It is customer driven. This tool considers industry factors as well as the customer needs.
The voice of the customers collected from the call centers and the customer service departments are the main input for new product development. The quality function deployment (QFD) was born out of the quality movements in the 1980s.
It is defined as a customer focused design approach for identifying and prioritizing customer needs, translating them into service specifications and tracking them throughout the product realization (Davis et al 2004). It provides a graphical method for determining customer expectations. It provides clarity on how the expectations and needs of the customer can be fulfilled. This tool also helps how the customer’s interest can be paralleled with the provider’s interest.
The CMSP are striving hard to achieve long term profits by satisfying the customer’s needs and expectations. The QFD focuses on planning and communication routines that focus and coordinate skills within the organization by first focusing on customer’s needs and wants and then design and market services that customer wants to purchase. It strives to achieve the total quality objective by translating and diffusing the customer needs and wants, the voice of the customer, vertically and horizontally throughout the organization.
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The core principle of the QFD is a systematic transformation of customer requirements into measurable product and process parameter. Its successful application can produce many benefits such as providing a framework for product development, assuring improved communication and sharing of information when the cross sectional teams develop a new product.
It preserves customer’s requirements in the customer’s word throughout the process and supports better understanding. It creates an information base that can be used for reduction in the overall cycle time. Thus overall cost is reduced due to the decreasing design changes by eliminating the redundant features and over design. It allows customers to prioritize their requirements, tell the CMSP how they are doing as compared to the competitors, and then directs to bring the greatest competitive advantage.
9.5 Product Management
The survival and growth of the CMSP demands systematic development and testing of new product ideas .This approach of product development is called
Product Management. In simple terms, product management is an act to bring about substantial changes in the nature, quality, quantity, name, package, design and price of the product with a view to add something to improves its acceptability.
The project management consists of the following:
i) Introduction of new products;
ii) Modification of existing lines to suit the changing consumer needs
and preferences .
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As per the TRAI guidelines on the tariff plan there is a limitation on the number of the tariff plans a CMSP can offer to the customers, but there is no restriction on the number of products. . The sales team sells the products by implementing the plans of the product manager. The overall success of an organization depends on the planning and development of products.
9.6 Product Mix in Cellular Mobile Services
The product manager’s main job is to design, implement and modify the product mix. It will be appropriate to explain the concepts used in the cellular mobile services. The “Product mix is the set of all products and items that a particular company offers for sale to buyers.” It comprises of Product line,
Product width, Product length and Product consistency. The “Product line is a group of products that are closely inter-related since they perform a similar function and are sold to similar groups and are marketed through the same channel. ” In the example shown above the CMSP have three product lines namely prepaid, post paid and the value added services. “Product Width, on other hand, is measured by the number of product lines.” The product mix here comprises of four product lines. The product mix length refers to the total number of items in its product mix.”
The length of product mix is of 13 products. In the given example, the product consistency is very close as they are dispensed through the same distribution channel and used by the same customer’s. The responsibilities of a product management team includes-Developing new products, Branding, Packaging designs, Channel designs, Pricing and Promotion strategies.
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In order to analyze the quality of the services provided by the CMSP in
Mumbai the customers perception was taken on promotion, physical evidence, network quality and price. The result was multiplied with the % weight age of the four factors.
Chart 9.1 Cellular Mobile Product Mix.
CELLULAR MOBILE SERVICE PRODUCT MIX
Post-paid Prepaid Value Added
services
Voice & data Voice & data SMS, Ring back tones, services, SMS, STD, ISD friends mobile banking STD, ISD, and Family, Night and television. Friends& Family, talk, one India, pay GPS, EDGE, Night talk, one Per second billing GPRS, 3G and India, Pay per packs. HSDPA. second billing packs. Source: own Illustration
9.7 Comparative Analysis of Product (network) for CMSPs
In order to the study the Comparative analysis for the promotion factor the response of the mobile customers in the sample region was taken by a questionnaire in which the response was requested by comparing the promotion of one CMSP with respect to the remaining five. The AHP method was used for analysis. The values are given the Table 9.1 and 9.2
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Table: 9.1 Customer responses on network quality.
SNo R B T L V M 1 R 1.00 2.0 3.0 3.00 0.33 3.00 2 B 0.50 1.00 3.0 1.00 2.00 2.00 3 T 0.33 0.33 1.00 3.00 1.00 3.00 4 L 0.33 1.00 0.33 1.00 4.00 2.00 5 V 3.00 0.50 1.00 0.25 1.00 3.00 6 M 0.33 0.50 0.33 0.50 0.33 1.00 Total 5.49 5.33 8.66 8.75 8.66 14.00 0.18 0.19 0.12 0.11 0.12 0.07 Source survey results
Legend R-Reliance Infocom, B-Bharti Airtel, T-Tata Teleservices limited, L- Loop Mobile (old name BPL), V-Vodafone limited (Hutch), M-Mahanagar Telephone Nigam Limited Mumbai.
Table: 9.2 Normalized Results obtained by multiplication with % Weight.
SNo R B T L V M Avg. 1 R 0.18 0.38 0.36 0.33 0.04 0.21 0.25 2 B 0.09 0.19 0.36 0.11 0.24 0.14 0.19 3 T 0.06 0.06 0.12 0.33 0.12 0.21 0.15 4 L 0.06 0.19 0.04 0.11 0.48 0.14 0.17 5 V 0.54 0.10 0.12 0.03 0.12 0.21 0.19 6 M 0.06 0.10 0.04 0.06 0.04 0.07 0.06 Total 0.99 1.01 1.04 0.96 1.04 0.98 1.00 Source survey findings
Conclusions on the Comparative Analysis on Promotion for CMSP
i) The values for the promotion factor received for all the CMSP are almost similar (0.99, 1.01, 1.04, 0.96, 1.04, 0.96 and 1.01). ii) The maximum value corresponds to Vodaphone limited and the lowest value belongs Loop Mobile.
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Chapter -X Review of the Physical Evidence
10.1Introduction
10.2 Servicescape Effects on Customer Behavior
10.3 Environmental Dimensions of the
Servicescape
10.4 Understanding Servicescape Effects
10.5 Customers Feedback on the Servicescape
10.6 Comparative Analysis of Price for CMSPs.
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Chapter -X Review of the Physical Evidence
10.1 Introduction
The services are performances or objects rather than objects; they can not be seen, felt, tasted or touched in the same manner that we can sense tangible goods. The cellular mobile service (CMS) is actions provided by the cellular mobile service providers (CMSPs). These cannot actually be seen or touched by the customer although the customer may be able to see and touch tangible components of the services. The tangible component in the cellular mobile services consists of subscriber Identity module (SIM) card.
Cellular mobile Services are intangible; customers often rely on tangible cues, or physical evidences, to evaluate the mobile service before its purchase and to access their satisfaction with the services during and after the consumption.
The physical evidence is the environment in which the service is delivered and where the cellular mobile service provider (CMSP) and the customer interact and any tangible commodities that facilitate performance or communication of the services. The actual physical facility where the service is performed delivered and consumed; is referred to as the servicescape. An effective design of physical, tangible evidence is important for closing the service gap.
The general elements of physical evidence consist of servicescape and other tangibles. They include all the aspects of the organizations physical facility as well as other forms of tangible communications elements of the servicescape that affect customers include both exterior attributes(such as signage,
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parking, landscape) and interior attributes (such as the design lay out, equipment décor). The cellular mobile services communicate heavily through physical evidence. The elements of the physical evidence and other tangible for the cellular mobile services are given.
Table 10.1 the elements of the physical evidence.
Service scape Other tangibles Facility exterior Business cards Exterior design Stationery Signage Billing statements Parking Reports Landscape Employee’s dress Surrounding environment Uniforms Facility interior Brochures Interior design Internet web Equipment Signage Lay out Air quality/temperature
Each of the above evidence listed above communicate something about the service to consumers and/or facilitate performance of the cellular mobile service. A number of consumer researches have shown that the design of the servicescape can influence customer choices, expectations, satisfaction, and other behaviors.
It is seen that the customer are influenced by the smell, decor, music and store lay out. It is also observed that the layout of the work place affect the productivity, motivation and satisfaction of the employees. There should be a balance between the managements concern for their feelings and job satisfaction and customer comfort. The servicescape can be categorized by who actually comes into the service facility and thus is potentially influenced by its design customers, employees or both. In the olden days the telecom
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facility was offered in such a way that the customer ever see the service facility. The facility was installed in a remote location. This has changed after the launch of the cellular mobile services the service scape for offering the service has gone a paradigm shift as it requires extensive interaction between the customers and the cellular mobile service provider specially for the customization of the value added services on mobile handsets. The servicescape are classified depending upon the difficulty of the service interactions. The cellular mobile service needs many elements and many forms, it needs elaborate environments. They servicescape play an important role in providing appropriate physical evidence of the service.
10.1.1 Package
Similar to a tangible product’s package the service scape and other elements of physical evidence essentially wrap the service and convey an external image of what is inside to consumers. Product packages are designed to portray image as well as to evoke a particular sensory or emotional reaction.
The physical evidence does the same through the interaction of many complex stimuli.
The servicescape is the outward appearance of the organization and thus can be critical in forming initial impression or setting up customer expectations it is a visual metaphor for the intangible service. This plays an important role in creating expectations for the new customers and for the newly established service organizations that are trying to build a particular image. The packaging role extends to the appearance of contact personnel through their uniforms or dress and other elements of their out ward appearance. It is seen
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that the same care and importance as given in package design in product marketing is not given to service package.
10.1.2 Facilitator
The servicescape can also serve as a facilitator in aiding the performances of persons in the environment. A well designed, functional facility can make the service a pleasure to experience from the customer’s point of view and a pleasure to perform the employee’s. On the other hand, poor and inefficient design may frustrate both the customers and the employees.
10.1.3 Socializer
The design of the service scape aids in the socialization of both the employ’s and customers in the sense that it helps to convey the expected roles, behaviors, and relationships. The design of the facility can also suggest to customers what their role is relative to employees, what parts of the servicescape they are welcome and which are for the employees only, how they should behave while in the environment, and what types of interactions are encouraged.
10.1.4 Differentiator
The design of the physical facility can differentiate a firm from its competitors and signal the market segment the service intended for. Given its power as a differentiator, changes in the physical environment can be used to reposition a firm and/ or to attract new market segments. The design of a physical setting can also differentiate one area of the service organization from another. Price
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differentiation is also often partially achieved through variations in physical settings.
10.2 Service Scape Effects on Behavior
The framework for understanding servicescape effects on behavior follows from basic stimulus organism response theory. In this theory the multidimensional environment is the stimulus, consumers and employees are the organism that responds to the stimuli, and behaviors directed at the environment are the responses. The assumptions are that dimensions of the servicescape will impact customers and employees and they will behave in certain ways depending on their internal relations to the servicescape. The comprehensive stimulus-organism-response model that recognizes complex dimensions of the environment, impacts on the multiple parties(customers, employees and their interactions),multiple types of internal responses
(cognitive, emotional and physiological), and a variety of individual and social behaviors it can result.
10.2.1. Individual Behavior
The human behavior is influenced by the physical settings in which it occurs is essentially a truism. The environmental psychologist suggest that individuals react to places with two general, and opposite, forms of behavior; approach and avoidance. The approach behavior include all positive behaviors that might be directed to a particular place, such as desire to stay, explore , work and affiliate. Avoidance behaviors reflect the opposite – a desire not to stay.
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In addition to attracting or deterring entry, the servicescape can actually influence the degree of the success consumers and employees experience in executing their plans once inside.
10.2.2. Social Interactions
In addition to its effects on their individual behaviors, the servicescape influences the nature and quality of customer and employee interactions, most directly in interpersonal services. The physical container can affect the nature of social interactions in terms of the duration of interactions and the actual progression of the events. The servicescape can help define the social rules, conventions and expectations in force in a given setting, thus serving to define the nature of social interactions.
10.2.3 Internal Response to the Services Scapes
The employees and customers respond to dimensions of their physical surroundings, cognitively, emotionally and physiologically, and responses are what influence their behaviors. The internal responses are independent they depend on the person’s belief about the place.
10.2.4 Environment and Cognition
The perceived service scape can have an effect on people’s beliefs about a place and their beliefs about the people and the products found in that place.
In a sense the servicescape can be viewed as a form of nonverbal communication, imparting meaning through what is called as the object language. The perceptions of the servicescape may simply help people to
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distinguish a firm by influencing how it is categorized. The overall perception of the service-scape enables the consumer to categorize the firm mentally.
10.2.5. Environment and Emotion
In addition to influencing beliefs, the perceived servicescape can directly elicit emotional responses that in turn influence behaviors. Just being in a particular place can mark the customers happy or gloomy.
The environmental psychologists have researched people’s emotional response to physical settings. They have concluded that any environment will elicit emotions that can be captured by two basic dimensions displeasure/pleasure and degree of arousal. Servicescape that are both pleasant and arousing would be termed as exciting while those that are pleasant and non arousing are distressing.
10.2.6. Environment and Physiology
The perceived servicescape may also affect people is purely physiological ways. Noise that is too loud may cause physical discomfort, the temperature of the room may cause people to shiver or perspire, the air quality may make it difficult to breathe, and the glare of lighting may decrease ability to see and cause physical pain. All of these physical responses may, in turn directly influence whether the people stay in and enjoy a particular environment.
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10.2.7 Variations in the Individual Response
In general, people respond to the environment in the ways cognitively, physiologically and their responses influence how they behave in the environment. The response of the individual will not be same every time.
Temporary mood states can cause people to respond differently to environment stimuli.
10.3 Environmental Dimensions of the Service Scape
These can be categorized into three composite dimensions ambient conditions, spatial layout and functionality; signs, symbols, and artifacts.
10.3.1 Ambient Conditions
Ambient conditions include back ground characteristics of the environments such as temperature, lighting, noise, music, scent and color. All these factors can profoundly affect how people feel, think, and respond to a particular service establishment. If the ambient conditions are in the comfort zone they get unnoticed. They have greater effect when the customers and employees spend considerable time in the servicescape.
10.3.2 Spatial Layout and functionality
The servicescape generally exist to fulfill specific purposes or needs of the customers, spatial layout and functionality of the physical surroundings is particularly important. The spatial layout refers to the ways in which machinery, equipments and furnishings are arranged the size and shape of
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these items and the spatial relationship between them. The spatial layout and functionality of the environments are particularly important for the customer’s in self service environments where they have to perform the service on their own and cannot rely on the customers.
10.3.3 Signs, Symbols, and Artifacts
Many items in the physical environment serve as explicit or implicit signals that communicate about the place to its users. Signs displayed on the exterior and interior of a structure are examples of explicit communicators. They can be used as labels, and to communicate rules of behavior for directional purposes, and to communicate rules of the behavior.
Other environmental symbols and artifacts may communicate less directly than signs, giving implicit cues to the users about the meaning of the place and norms and expectations for behavior in the place. The signs symbols and artifacts are particularly important in forming first impressions and for communicating new service concepts. When the customers are unaware of a particular service establishment, they will look for environmental cues for help them categorize the place. Signs, symbols and artifacts can also be important in forming first impression and for communicating new service concepts. They are important for repositioning and differentiating a service.
10.4 Understanding Services cape Effects
The servicescape has a profound effect both on the customers and the employees in service settings. To design the environments that work from
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both a marketing and organizational behavior perspective firms need to research environmental decisions and plan them strategically. The organization can learn about the user’s reaction and preferences by the following methods.
10.5.Customers Feedback on Service scapes
An environment survey asks people to express their needs and preferences for different environmental configurations by asking predetermined questions in a questionnaire format. The advantages are the ease of administration and interpretations of the results.
10.5.1 Observations
Using these methods, trained observers make detailed accounts of environmental conditions and dimensions, also observing and recording the reactions and behaviors of customers and employees in the servicescape.
10.5.2 Experiments
Experimental methods are among the best ways to assess specific customer and the employee’s reactions to environmental changes or alternatives when it is important to know their true reactions and preferences. It involves exposing groups of customers to different environments and records their reactions.
10.5.3 Photographic Blue Print
A Photographic blue print essentially provides a visualization of the services at each customer set up action. They are extremely useful in providing clear
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and logical documentation of the physical evidence as it currently exists in a given service situation. The photos and video tapes give more depth to the process blue print and it forces certain logic on the analysis of the blue print.
General Guideline’s for Physical Evidence Strategy.
The CMSP follow the guidelines given below for effective physical evidence.
i) Recognize the impact of the physical evidence.
ii) Map the physical evidence of the service.
iii) Clarify the roles of the servicescape.
iv) Assess and Identify physical evidence Opportunities.
v) Work cross functionally.
10.6 Comparative Analysis of physical evidence for CMSPs
In order the study the Comparative analysis for the promotion factor the response of the mobile customers in the sample region was taken by a questionnaire in which the response was requested by comparing the promotion of one CMSP with respect to the remaining five. The AHP method was used for analysis. The values are given the Table 11.1 and 11.2
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Table: 10.1 physical evidence option performance matrix.
SN0 R B T L V M 1 R 1.00 0.14 4.00 0.33 1.00 2.00 2 B 5.00 1.00 4.00 0.25 0.33 4.00 3 T 0.20 0.25 1.00 5.00 0.25 0.33 4 L 5.00 4.00 0.20 1.00 0.25 0.33 5 V 1.00 3.00 4.00 4.00 1.00 0.50 6 M 4.00 3.00 3.00 3.00 2.00 1.00 7 16.20 11.39 16.20 13.58 4.83 8.16 0.06 0.09 0.06 0.07 0.21 0.12 LEGEND R-Reliance Infocom Infocom–Bharti Airtel, T- Tata Teleservices limited, L- Loop Mobile(old name BPL), V-Vodafone limited (Hutch), M-Mahanagar Telephone Nigam Limited Mumbai. Table: 10.2 Normalized Results obtained by multiplication with % weight.
SNo R B T L V M Avg 1 R 0.06 0.01 0.24 0.02 0.21 0.24 0.13 2 B 0.30 0.09 0.24 0.02 0.07 0.48 0.20 3 T 0.01 0.02 0.06 0.35 0.05 0.04 0.09 4 L 0.30 0.36 0.01 0.07 0.05 0.04 0.14 5 V 0.06 0.27 0.24 0.28 0.21 0.06 0.19 6 M 0.24 0.27 0.18 0.21 0.42 0.12 0.24 0.97 1.03 0.97 0.95 1.01 0.98 0.99
Conclusions on the Comparative Analysis on Price for CMSP
i) The values for the promotion factor received for all the CMSP are almost similar (0.91, 1.00, 0.93, 0.98, 0.99 and 1.01). ii) The maximum value corresponds to Bharti Airtel limited and the lowest value belongs to Loop Mobile.
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Chapter - XI Review of Promotion Management
11.1 Introduction
11.2 The Communication Process
11.3 Promotional Methods used by CMSP
11.4 Promotion Targets
11.5 Objectives of Marketing Promotions
11.6 Promotion Mix for the CMS
11.7 Comparative Analysis of the Promotion for
CMSPs.
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Chapter - XI Review of Promotion Management
11.1 Introduction
The competition in the cellular mobile service (CMS) industry calls for not only developing a good product, pricing it attractively and making it available to the customers, but also to communicate with the customers about its quality and usefulness. The cellular mobile service providers (CMSPs) use almost the similar quality of the telecom equipment and manpower it is only how much they spend and in what way they spend on communication with the customers that matters. The CMSPs have to communicate with the dealers, distributor’s retailers, consumers, and various other agencies. The customers also communicate with each other about the quality of the service and availability of the products in the market. This creates a very strong opinion about the service quality of the mobile service in the market.
The promotion is a form of corporate communication that uses various methods to reach a targeted audience with a message in order to achieve specific organizational objectives. The CMSP have engaged multinational firms for handling their promotion campaign by spending large sums on high- profile celebrities to serve as their spokes persons. The CMSP have signed up Bollywood stars for promotion of cellular mobile services. They are using promotion distinguish their products from competitors’ offerings. An effective promotional strategy requires the marketer understand how promotion fits with
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other pieces of the marketing puzzle (e.g., product, distribution, pricing, target markets). The promotion decisions are very crucial and are taken at a senior level of management. The success of a promotional strategy requires inputs from other functional areas.
The CMSP are attempting to develop a unified promotional strategy as per the latest concept of Integrated Marketing Communication involving the coordination of different types of promotional techniques. The key idea for success when several promotional options are used is to employ a consistent message across all options. In this way no matter where customers are exposed to a marketer’s promotional efforts they all receive the same information.
11.2 The Communication Process
The act of communicating has been evaluated extensively for many, many years. One of the classic analyses of communication took place in the 1940s and 1950s when researchers, including Claude Shannon, Warren Weaver,
Wilbur Schramm and others, offered models describing how communication takes place. In general, communication is how people exchange meaningful information. For communication to occur there must be at least two participants:
i) Message Source – The source of communication is the party
intending to convey information to another party. The message source
can be an individual (e.g., salesperson) or an organization (e.g.,
through advertising).
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ii) Message Receiver – The receiver of communication is the intended
target of a message source’s efforts. For a message to be understood
the receiver must decode the message by undertaking mental and
physical processes necessary to give meaning to the message.
The Communication takes place in the form of a message that is exchanged between a source and receiver. A message can be shaped using one or a combination of sensory stimuli that work together to convey meaning that meets the objectives of the sender. The sender uses a transmission medium to send the message. In marketing the medium may include the use of different media outlets (e.g., Internet, television, radio, print), promotion-only outlets (e.g., postal mail, billboards), and person-to-person contact (e.g., salespeople). Additionally, communication can be improved if there is a two- way flow of information in the form of a feedback channel. This occurs if the message receiver is able to respond, often quickly, to the message source. In this way, the original message receiver now becomes the message source and the communication process begins again. There are many potential obstacles to the message successfully reaching the receiver the way the sender intends. The potential obstacles that may affect communication include poor encoding, poor decoding, and media failure and communication noise.
11.3 Promotional Methods used by CMSP
The CMSP use a variety of promotion methods to communicate with their customers and prospects.
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i) Intended Audience Promotions can be categorized based on the
intended coverage of a single promotional message. It can be mass or
targeted.
ii) Interaction Type this type of promotions involves people
communicating with each other; this is also called personal promotion.
It uses people to help spread awareness about a product but is not
designed to directly elicit orders. One key advantage personal
promotions have is the ability for the message sender to adjust the
message as they gain feedback from message receivers.
iii) Message Flow: Promotions can be classified based on whether the
message source enables the message receiver to respond with
immediate feedback. Such feedback can then be followed with further
information exchange between both parties. Most efforts at mass
promotion, such as television advertising, offer only a one-way
information flow that does not allow for easy response by the message
receiver.
iv) Demand Creation: The promotion campaigns of all CMSP are
focused on the generation of demand. A number of new CMSP have
granted cellular mobile telephony license recently. In general, the
demand creation is most effective when customers are offered an
incentive to make the purchase either in a monetary way (e.g., save
money) or in psychological way (e.g., improves customer’s perceived
group role or status level).
The promotion cost is monitored by the CMSP on weekly basis as some of the CMSP having pan India presence advertise very aggressively. The call
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centre is the place from where the response of the promotion campaign is monitored. The promotional cost is measured in several different ways in terms of cost-per-impression (CPI), cost-per-targeted impression (CPTI), and cost-per-action (CPA). The CPI metric relates to how many people are exposed to a promotion in relation to the cost of the promotion. With CPA the marketer evaluates how many people actually respond to a promotion.
Response may be measured by examining purchase activity, number of phone inquiries, website traffic, clicks on advertisements, and other means within a short time after the promotional message was delivered.
11.4 Promotion targets
The CMSP target audience for the promotion is not limited to just the marketer’s target market. While the bulk of a marketer’s promotional budget is directed at the target market, there are many other groups that serve as useful target of a marketing message. The targets of a marketing message generally fall into one of the following categories:
i) The Members – This category would include current customers,
previous customers and potential customers; they may receive the
most promotional attention.
ii) The Influencers– A large group of people and organizations that
can affect how a company’s target market is exposed to and perceives
a company’s service. These influencing groups have their own
communication mechanisms that reach the target market and the
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marketer may be able utilize these influencers to its benefit. Influencers
include the news media, special interest groups, opinion leaders (e.g.,
doctors directing patients), and industry trade associations. The CMSP
have roped in film stars, prominent sports person and Chief Executive
officers to influence the target market in their favor.
iii) Participants in the Distribution Process – The distribution
channel provide services to help gain access to final customers and
are also target markets since they must recognize a product’s benefits
and agree to handle the product in the same way as final customers
who must agree to purchase products. Most of the CMSP promotion is
aimed towards the distribution partners (e.g., retailers, wholesalers,
distributors) It is noticed that a number of new product are launched by
the CMSP every month with promotion schemes for the distributors
and dealers.
iv) Other Organizational Stakeholders –This group consists of those
who provide services, support or, in other ways, impact the company.
The telecom regulatory authority of India (TRAI) sets industry
standards which affect company products. Communicating with this
group is important to insure the marketer’s views of any changes in
standards are known.
11.5 Objectives of Marketing Promotions
The most obvious objective of promotional activities of the CMSP is to convince customers to make a decision to buy their services. It means getting
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customers to buy cellular mobile services and value added services, to retain loyal long-term customer.
The CMSP know that getting customers to subscribe their services is only achievable when a customer is ready to make the purchase decision. The customers are very price sensitive and before turning into a repeat customer, they analyze their initial purchase to see whether they received a good value, and then often repeat the purchase process again before deciding to make the same choice. The repeat purchase is very important from the angle of prepaid services.
11.6. Promotion Mix for the CMS
The CMSP have at their disposal four major methods of promotion. Taken together these comprise the promotion mix.
i) Advertising – Involves non-personal promotions often using mass
media outlets to deliver the marketer’s message. The Television and
radio is the most preferred media by the CMSP who have a pan India
presence.
ii) Sales Promotion – Involves the use of special short-term
techniques, often in the form of incentives, to encourage customers to
respond or undertake some activity. This is done by providing retail
coupons with expiration dates which motivates the customers to act
while the incentive is still valid.
iii) Public Relations – Also referred to as publicity, this type of
promotion uses third-party sources, and particularly the news media, to
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offer a favorable mention of the marketer’s company or product without direct payment to the publisher. The CMSP sponsor the local festivals like Ganesh Chaturthi and Dahi Handi in Mumbai and offer trail plans. iv) Personal Selling – As the name implies, this form of promotion involves personal contact between company representatives and those who have a role in purchase decisions. Often this occurs face-to-face or via telephone. This is mostly preferred by the direct sellers and franchise of the CMSP. It is a challenge for the CMSP to select the promotion mix.
The following criterion is used by them: i) Promotional Objective – The CMSP have only one objective to increase the number of customers and increase the sale of the prepaid customers. ii) Availability of Resources – The amount of money and other resources that can be directed to promotion affects the marketer’s choice of promotional methods. The private CMSP like Airtel, Vodafone limited and Reliance Infocom having pan India foot print and spend lavishly. iii) Company Philosophy – Some companies follow a philosophy that dictates where most promotional spending occurs. The MTNL rarely advertises its services moreover it informs the customer about the new launches. iv) Target Market – As one might expect, customer characteristics dictate how promotion is determined. Characteristics such as size, location and type of target markets affect how the marketer
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communicates with customers. The promotion by the CMSP is always
biased towards prepaid customers as they are major lot.
V) Service: The CMSP uses mass market promotional approaches for
prepaid while personalized selling is used for the post paid services. As
a product moves through these stages the product itself may evolve
and also promotional objectives will change. This leads to different
promotional mix decisions from one stage to the next.
vi) Distribution –Marketing organizations selling through channel
partners can reach the final customer either directly using a pull
promotion strategy or indirectly using a push promotional strategy. The
push strategy uses promotion to encourage channel partners to stock
and promote the product to their customers. The CMSP use both
approaches.
11.6.1 Advertising
Advertising is a non-personal form of promotion that is delivered through selected media outlets that, under most circumstances, require the marketer to pay for message placement. It has long been viewed as a method of mass promotion in that a single message can reach a large number of people. But, this mass promotion approach presents problems since many exposed to an advertising message may not be within the marketer’s target market, and thus, may be an inefficient use of promotional funds.
The CMSP rely heavily on advertisements to create customer interest in marketing objectives. They launch regular advertising campaigns, which involve a series of decisions for planning, creating, delivering and evaluating
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an advertising effort. Some of the CMSP have employed market researchers who assess the market situation, including understanding customers and competitors. They are also used following the completion of an advertising campaign to measure whether the campaign reached its objectives. The
CMSP use different type of advertising in the different phases of the product life cycle.
i) Most advertising spending is directed toward the promotion of a
specific plan or prepaid product. In most cases the goal of product
advertising is to clearly promote a specific product to a targeted
audience. The CMSP intentionally produce product advertising where
the target audience cannot readily see a connection to a specific
product. This “teaser” approach in advance of a new product
introduction to prepare the market.
ii) Image advertising is undertaken primarily by CMSP to enhance their
perceived importance in the target market. It does not focus on specific
products as much as it presents what an organization offers.
iii) Advocacy advertisement is used to send a message intended to
influence a targeted audience. The Cellular Mobile Service providers
always advocate that mobile services are better than landline service
and prepaid is easy to use than the postpaid.
There is a major cultural shift occurring in how people use media for entertainment, news and information. Many traditional media outlets, such as newspapers and major commercial television networks, are seeing their customer base eroded by the emergence of new media outlets. The Internet
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has become the major driver of this change. The SMS is very frequently used by the CMSP to inform about the tariff changes and new services.
11.6.2 Sales Promotion
Sales promotion describes promotional methods using special short-term techniques to persuade members of a target market to respond or undertake certain activity. As a reward, CMSP offer something of value to those responding generally in the form of lower cost of ownership for a purchased product or the inclusion of additional value-added services. The promotion involves a short-term value proposition for which customer must perform some activity in order to be eligible to receive the value proposition the inclusion of a timing constraint and an activity requirement is hallmarks of sales promotion. The CMSP use sales promotions very frequently. It is used by the CMSP to achieve
i) Product Awareness: exposing customers to products for the first
time and can serve as key in the early stages of product
introduction by offering free downloads.
ii) Creating Interest: CMSP have found that sales promotions are
very effective in creating interest in their product by offering trail
packages.
The sale promotions is done by placing coupons in the existing products which offers value to purchasers typically by lowering the customer’s final cost for acquiring the product. While rebates share some similarities with coupons, they differ in several keys aspects. First, rebates are generally handed or
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offered to customers after a purchase is made and cannot be used to obtain immediate savings in the way coupons are used. Second, rebates often request the purchaser to submit personal data in order to obtain the rebate.
For instance, customer identification, including name, address and contact information, is generally required to obtain a rebate. Also, the marketer may ask those seeking a rebate to provide additional data such as indicating the reason for making the purchase.
One of the most powerful sales promotion techniques is the short-term price reduction or sale pricing, lowering a product’s selling price can have an immediate impact on demand, though marketers must exercise caution since the frequent use of this technique can lead customers to anticipate the reduction and consequently, withhold purchase until the price reduction occurs again.
11.6.3 Public Relations
Public relations involve the cultivation of favorable relations for organizations and products with its key publics through the use of a variety of communications channels and tools. Traditionally, this meant public relations professionals would work with members of the news media to build a favorable image by publicizing the organization or product through stories in print and broadcast media. But today the role of public relations is much broader and includes:
i) Building awareness and a favorable image for a company or client
within stories and articles found in relevant media outlets.
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ii) Closely monitoring numerous media channels for public comment
about a company and its products.
iii) Managing crises that threaten company or product image.
iv) Building goodwill among an organization’s target market through
community, philanthropic and special programs and events
The Public relations offers several advantages to CMSP not found with other promotional options. First, it is often considered a highly credible form of promotion. One of PR’s key points of power rests with helping to establish credibility for a product, in the minds of targeted customer groups by capitalizing on the influence of a third-party. Audiences view many media outlets as independent sources that are unbiased in their coverage, meaning that the decision to include the name of the company and the views expressed about the company is not based on payment but on the media outlet’s judgment about the product. For example, a positive story about a new product in the business section of a local newspaper may have greater impact on readers than a full-page advertisement for the product since readers perceive the news media as presenting an impartial perspective of the product. Second, a well-structured PR campaign can result in the target market being exposed to more detailed information than they receive with other forms of promotion. That is, media sources often provide more space and time for explanation of a product. Third, depending on the media outlet, a story mentioning a company may be picked up by a large number of additional media, thus, spreading a single story to many locations.
Finally, in many cases public relations objectives can be achieved at very low cost when compared to other promotional efforts. Wwhen compared to the
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direct cost of other promotions, in particular advertising, the return on promotional expense are quite high.
11.6.4 Personal Selling
Personal selling is a promotional method in which one party uses skills and techniques for building personal relationships with another party those results in both parties obtaining value. The selling involves personal contact, this promotional method often occurs through face-to-face meetings or via a telephone conversation. Some popular Personal Selling methods used by
CMSP are:
i) Telemarketing: This category includes product sales over the
phone. This is extensively used by the CMSP.
ii) Word-of-Mouth Promotion: a new form of personal selling
relies on real people to help spread the word about a product.
Those selling are not employees.
11.7 Comparative Analysis of for CMSPs
In order the study the Comparative analysis for the promotion factor the response of the mobile customers in the sample region was taken by a questionnaire in which the response was requested by comparing the promotion of one CMSP with respect to the remaining five. The AHP method was used for analysis.
The values are given the Table 11.1 and 11.2
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Table: 11.1 the customer’s response on promotion
SNo R B T L V M 1 R 1.00 0.20 5.00 0.20 1.0 0.16 2 B 5.00 1.00 7.00 0.20 0.16 6.00 3 T 0.20 0.14 1.00 6.00 0.20 0.20 4 L 5.00 5.00 0.16 1.00 0.25 0.20 5 V 1.00 6.00 5.00 4.00 1.00 0.20 6 M 6.00 0.16 5.00 5.00 5.00 1.00 18.20 12.50 23.16 16.40 7.61 7.76 0.05 0.08 0.04 0.06 0.13 0.13 LEGEND R-Reliance Infocom Infocom–Bharti Airtel, T- Tata Teleservices limited, L- Loop Mobile (old name BPL),V-Vodafone limited (Hutch), M-Mahanagar Telephone Nigam Limited Mumbai.
Table: 11.2 Normalized Results obtained by multiplication with % weight.
Sno R B T L V M Avg. 1 R 0.05 0.02 0.20 0.01 0.13 0.02 0.07 2 B 0.25 0.08 0.28 0.01 0.02 0.78 0.24 3 T 0.01 0.01 0.04 0.36 0.03 0.03 0.08 4 L 0.25 0.40 0.01 0.06 0.03 0.03 0.13 5 V 0.06 0.48 0.20 0.24 0.13 0.03 0.19 6 M 0.30 0.01 0.20 0.30 0.65 0.13 0.27 Total 0.91 1.01 0.93 0.98 0.99 1.0 0.97
Conclusions on the Comparative Analysis on Price for CMSP
i) The values for the promotion factor received for all the CMSP are almost similar (0.91, 1.00, 0.93, 0.98, 0.99 and 1.01). ii) The maximum value corresponds to Bharti Airtel limited and the lowest value belongs Loop Mobile.
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Chapter -XII Findings
12.1 Introduction
12.2 Process of providing CMTS
12.3 Study of Service Quality Standards
12.4 Customers expectations
12.5 Performance of the Customer Service
Quality
12.6 Gaps in the Service quality
12.7 Comparative Analysis of the Customer services
12.8 Suggestions to bridge the gap
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Chapter -XII Findings
12.1 Introduction
The findings on objectives of this research study and hypothesis is discussed below in five parts:
i) The process of providing Cellular Mobile Telephone Service (CMTS).
ii) The study of service quality standards set up by telecom regulatory
authority of India (TRAI).
iii) The customers’ expectations about service quality.
iv) The Performance of customer service quality against the customers’
expectations.
v) The gaps in the customer service quality.
vi) Comparative Analysis of the customer service in Mumbai
vii) Suggestions to bridge the gap.
12.2 The Process of Providing Cellular Mobile Telephone Service
{H01: The CMSPs in Mumbai are meeting TRAI parameters}
The telecom ecosystem is still evolving in India. It is cumbersome to
obtain CMTS license. The spectrum allotment also takes time in the
absence of a time bound schedule.
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A lot of effort is required for building interconnect network for local,
national and international calls.
The cost of providing cellular mobile services in Mumbai is high while
the call rates are lowest in world due to the presence of eighteen
CMSPs in Mumbai.
Mumbai region falls in the Municipal limits of number of local
government bodies. It is very difficult to obtain permission for laying
optical fiber and erection of towers and as all of them follow different
sets of rule.
The CMSPs are launching mobile service without proper testing and
validation; during this period welcome plans are offered to new
customers without proper call centre to attend customer complaints.
The roll out obligations are not met as per the CMTS license
conditions, still there are a number of dark spots in Mumbai.
The spectrum is the core resource in providing the mobile services, the
lesser the spectrum more Base Transmission Stations are needed, and
the cost of the infrastructure increases for achieving the same service
quality.
Both GSM and CDMA cellular mobile service providers are facing
congestion due to scarcity of spectrum. It is felt more in Mumbai, due to
higher population density. The average spectrum available is only 6.2
MHz against the world average of 17.18 MHz.
The spectrum allotment policy is based on technology; it is different for
GSM and CDMA. The CMSP are allotted spectrum in different blocks
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some in 900 MHz some in 1800 MHz; maintenance cost is different for
different bands.
As per the above discussions it is concluded that the CMSPs in Mumbai region are not meeting the TRAI parameter and hence the null hypothesis
(H01) can be rejected.
12.3 Study of Service Quality standards set up by TRAI.
{H02: The CMSPs in Mumbai are meeting the customer expectations}
The customers are not aware about TRAI; the existing model focuses
on four parameters fault incidence and repair, network performance,
billing complaints and customer perceptions of mobile service.
The first three parameters are purely technical they are measured,
expressed and understood in terms of networks and network elements,
which usually has little meaning to customers. The fourth parameter
the customer perception of services measures the customer
satisfaction and call centre performance.
The benchmark for the perception of the customer services fixed by
TRAI in percentage terms seems to be very general. A number of
factors such as price, reliability, availability, usability and utility are not
included.
The TRAI service quality parameters were finalized after lot of
research and consultations from stake holders. On analysis of quarterly
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surveys done by TRAI from April 2003 to June 2005, CMSPs have
failed to meet service quality parameters.
These service quality parameters were modified in July 2005, on
analysis of the quarterly surveys done after modifications the CMSPs
again failed to meet the service quality parameters.
The service quality parameters are silent on the performance of the
mobile handsets; more than 40% customers use low cost and
refurbished handsets.
The cellular mobile service providers (CMSP) are experiencing that
customer satisfaction depends upon the perceptions of the customer
and there is a need to include all the parameters which influence the
customer’s perceptions.
A paradigm shift in service quality is noticed in the mobile service
industry. The challenges of QoS have begun to disappear from the
research agenda, a counter movement has started with the aim of
interpreting end-to-end quality in the proper sense of regarding the
user as the end of the communication chain.
The notion of Quality of Experience (QoE) has appeared, describing
quality as perceived by the user instead of as captured by (purely
technical) network parameters. It promotes a holistic understanding of
service quality, as it aims to address all technical and non-technical
parameters that contribute to the user experience of mobile service.
With the growth of mobile service, it has become very important for
CMSPs to measure the quality of experience (QoE) of its network
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accurately and improve it further to achieve and maintain competitive
edge.
As per the above discussions it is concluded that the CMSPs in
Mumbai region are not meeting the TRAI parameter and hence the null
hypothesis (H01) can be rejected.
12.4 Customer Expectations about Service Quality.
The customer’s expectation is simple they wish to remain reachable where
ever they go. The individual and the corporate customers have different
expectations and the expectations vary for different service attributes.
The mobile customers’ expectation is influenced purely by their personal
needs. They compare the perceptions with expectations before forming
any opinion on customer service.
The customers’ expectations were measured for all the eight dimensions
of service quality viz. Reliability, Responsiveness, Assurance, Empathy,
Tangibles, Network, Value added services and Innovation. The
expectations were measured using the seven point Likert scales whereby
the higher numbers indicate higher level of expectations or perceptions.
The values are given below:
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Table 12.1 Expectations on Reliability dimension. SNo Reliability item Expectation 1. Delivers promised service in time (p1) 6.24 2. Takes sincere efforts in solving complaints (p2) 6.35 3. Performs the service right first time (p3) 5.63 4. Provides the correct billing information in (p4) 6.16 time 5. Keeps inform when the services will be (p5) 5.82 performed Average=(P1+P2+P3+P4+P5/5) p 6.04 Source: research survey findings
Table 12.2 Expectations on Responsiveness. SNo Responsiveness Item Expectation 1. Provides prompt services (q1) 5.98 2. Always willing to help (q2) 5.96 3. Queries taken seriously (q3) 6.01 4. Never too busy to respond (q4) 5.56 Average=(q1+q2+q3+q4/4) Q 5.8 Source: research survey findings
Table 12.3 Expectations on Assurance. Sno Assurance Item Expectation 1. Instills confidence in you (r1) 5.60 2. Safe while transacting business (r2) 6.30 3. Providers consistently courteous (r3) 6.29 4. The knowledge to answer the (r4) 5.80 customer’s question Average=(r1+r2+r3+r4/4) R 5.99 Source: research survey findings
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Table 12.4 Expectations on Empathy. SNo Empathy Item Expectation 1. Easily accessible (s1) 4.88 2. Gives individual attention (s2) 5.21 3. Have best interest of customer (s3) 5.12 4. Understand your specific needs (s4) 5.53 Average=(s1+s2+s3+s4/4) S 5.18 Source: research survey findings
Table 12.5 Expectations on Tangibles. SNo Tangible Items Expectation 1. Modern looking equipment (t1) 5.48 2. Pamphlets or statements visually (t2) 5.52 appealing 3. Convenient business hours (t3) 5.42 Average=(t1+t2+t3/3) T 5.47 Source: research survey findings
Table 12.6 Expectations on Network quality. SNo Network Quality Item Expectation 1. Provides proper network coverage (nq1) 6.12 2. Network support voice calls of (nq2) 5.98 acceptable quality 3. Easily reachable (nq3) 5.80 4. Meets the promised SLA (nq4) 5.21 Average=(nq1+nq2+nq3+nq4)/4 NQ 5.77 Source: research survey findings
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Table 12.7 Expectations on value added service. SNo Value added services Items Expectation 1. Provides adequate customizations (vas1) 5.43 2. Billing is correct and done in time (vas2) 5.45 Average=(vas1+vas2/2) VAS 5.44 Source: research survey findings
Table 12.8 Expectations on Innovation. Sno Innovation Items Expectation 1. Provides innovative services Inov1 5.94 2. Provides innovative tariff plans Inov2 6.47 Average=(Inov1+Inov2/2) INOV 6.20 Source: research survey findings
It is seen that the value of the expectations for the service quality dimension reliability (6.04) and innovations (6.20) is more than six points.
The value of expectations for the remaining six service quality dimensions was found more than five and less than six, assurance (5.99), network quality (5.77), tangibles (5.47) and empathy (5.18). It can be concluded that the customers in Mumbai are looking for a mobile service which is highly reliable and supports innovative value added services.
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12.5 The performance of the Customer Service Quality and
Expectations.
In order to find the performance of the customer service quality against the
TRAI and customers’ expectations the gap between the perceptions and the expectations was calculated for all eight dimensions of the service quality.
The overall gap between the perceptions and the expectations was found negative. This resulted in the negative gap score (Perception-Expectation).As per Parasuraman et al., (1988 p30) the negative gap is common as the customers’ expectations are always more than the perceptions and they keep on increasing.
Table: 12.9 Expectations, perception and Gap for eight dimension of SQ.
Sno Dimension Items Expectations Perceptions Gap 1 Reliability P 6.04 4.92 -1.12 2 Responsiveness Q 5.8 4.87 -0.93 3 Assurance R 5.99 5.13 -0.86 4 Empathy S 5.18 4.51 -0.66 5 Tangibles T 5.47 5.10 -0.36
6 Network quality NQ 5.77 5.16 -0.61 7 Value-added VAS 5.44 4.67 -0.77 services 8 Innovation INOV 6.20 5.16 -1.04 Source: research survey findings
The overall average gap score for all the eight dimensions = - 0.793.
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The overall service quality is measured by obtaining an average gap score of the SERVQUAL dimensions. In order to evaluate overall service quality as perceived by the mobile customers, we added three additional dimensions to the five existing dimensions. This is in line with Gronroos, 1982 who proposed two main dimensions of service quality functional and technical.
The gap score gives an idea about the quality of service provided by the
CMSPs. It is seen form the results above that the gap is negative and it proves that the CMSPs in Mumbai are not meeting the TRAI parameters and customers expectations. From the above table it can be seen that standard deviation scores fairly high for all the eight dimensions and suggested a wide range of opinion on service quality among the respondents.
The gap between perceptions and expectations is negative it indicates
that customers expect more than what is offered by the CMSPs in
Mumbai region. The mobile customers perceive service quality lower
than their expectations and hence they are not satisfied.
The overall service quality is measured by obtaining an average gap
score of the SERVQUAL dimensions. In order to evaluate overall
service quality as perceived by the mobile customers, three additional
dimensions were added to the five existing items.
The customers perceive service quality offered by the CMSP as poor in
all dimensions and falling short of their expectations. It is also
highlighted that the consumers are dissatisfied with all dimensions of
service quality.
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All the dimensions show a gap this means that CMSPs need to make
improvements in all dimensions in order to close gaps that could lead
to increased customer satisfaction.
12.6 Gaps in Customer Service Quality
The Gaps in the service quality dimensions for all the eight dimensions were studied in detail. The descriptive analysis is given below:
Reliability (P)
The value of mean for the reliability criteria is -1.091 and the median is -1.00.
The mode score is -0.20. The reliability dimension is rated high by the customers.
Responsiveness (Q)
The value of mean for the responsiveness criteria is -1.0 and the median is -
0.75. The mode score is 0.75. The responsiveness is also rated medium by customers.
Assurance (R)
The value of mean for the assurance criteria is -0.86 and the median is-0.75.
The mode score is-0.50. The assurance dimension is rated high by the customers.
Empathy(S)
The value of mean for the empathy criteria is -0.68 and the median are -
0.60. The mode score is -1.00. The empathy dimension is rated lowest by the customers.
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Table: 12.10 Descriptive statics for the eight dimensions of service quality
Dimension Mean Median Mode Std. skewness Kurtosis Deviation Reliability -1.091 -1.00 -0.20 1.12 -0.676 0.891 Responsiv -1.00 -0.75 -0.75 1.18 -1.00 0.98 eness Assurance -0.86 -0.75 -0.50 1.11 -0.74 0.84 Empathy -0.68 -0.60 -1.00 1.22 -0.95 1.26 Tangibles -0.62 -0.50 -0.25 1.057 -0.136 0.226 Network -0.72 -0.34 -0.34 1.21 -0.256 0.76 Value -0.77 -0.56 -0.21 1.13 -0.43 0.65 Added services Innovation -0.89 -0.54 -0.45 1.21 -0.54 0.91 Source: research survey findings
Tangibles (T)
The value of mean for the tangibles criteria is -0.62 and the median is -0.50.
The mode score is -0.25. The tangible dimension is rated medium by the customers.
Network (NQ)
The value of mean for the network criteria is -0.72 and the median is -0.34.
The mode score is -0.21. The network dimension is rated high by the customers.
Value Added services (VAS)
The value of mean for the value added service criteria are -0.77 and the median is -0.56. The mode score is -0.21. The assurance dimension is rated medium by the customers.
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Innovation (INNOV)
The value of mean for the innovation criteria is –0.89 and the median are -
0.54. The mode score is-0.45. The innovation dimension is rated highest by the customers.
The mobile customers are becoming more demanding and do not
tolerate any short falls in the quality of services offered.
Overall service quality is measured by obtaining an average gap score
of the SERVQUAL dimensions. It was suggested that when the
perceived service quality is high, then it will lead to increase in
customer satisfaction.
A higher perception also indicates higher satisfaction as service quality
and satisfaction are positively correlated. This means that the
dimensions with the higher perception scores depict higher satisfaction
on the part of customers and lower perception scores depict lower
satisfaction. The service quality is an antecedent of customer
satisfaction, which was proven by Negi et al., (2009). It means that
since customers perceive service quality as low or poor and therefore
implies that consumers are not satisfied with the services offered by
CMSP in Mumbai.
12.7 The Comparative analysis of the Customer Service
A survey was done to find out which ‘P’ of the customer service is important from the customer’s point of view. Out of the seven Ps of services marketing
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price, promotion; product and physical evidence were found to be important.
The Analytical hierarchy process (AHP) was used for ranking CMSP on quality of customer service.
Out of the above four factors it was found that network quality contributes
49.6%, is the most important for the customers, the price 28.9% is the second important factor, the physical evidence with 13% is the third important factor and promotions with 8.6% is the least important.
A six sets of pair wise comparisons how well Reliance Infocom, Bharti Airtel,
Vodafone limited, Mahanagar Telephone Nigam Limited, Loop Mobile and
Tata teleservices limited perform in terms of the promotion, network, price and physical evidence was obtained from the customers. In order to analyze the quality of the services provided by the CMSP in Mumbai the customers perception was taken on promotion, physical evidence, network quality and price. The result was multiplied with the % weight age of the four factors.
The findings are given in the matrix below; it summarizes the respective performance of the Cellular Mobile Service Provider (CMSP) in terms of the promotion, Price, Promotion and physical evidence which are important for the customer. Reading down each column, it states the Reliance Infocom is best in the network quality and MTNL is worst, the services of the Tata teleservices limited are cheapest and MTNL. The promotion of the MTNL is found to be the best and worst for Tata Tele services. The physical evidence is best for MTNL and worst for Bharti Airtel.
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Table: 2.11 the option performance matrix.
Sno Factor R B T L V M 1 Network 0.25 0.19 0.15 0.17 0.19 0.06 2 Price 0.12 0.18 0.06 0.17 0.22 0.26 3 Promotion 0.07 0.24 0.06 0.13 0.19 0.27 4 Evidence 0.13 0.2 0.09 0.14 0.19 0.24 Source: research survey findings
LEGEND R-Reliance Infocom Infocom–Bharti Airtel, T- Tata teleservices limited, L- Loop Mobile(old name BPL), V-Vodafone limited (Hutch), M- Mahanagar Telephone Nigam Limited Mumbai
In the final step the customer’s judgment as to the relative importance of the
Price, promotion, physical evidence and network 49.6%, promotion 8.6%, price 28.9% and physical evidence 13% is multiplied to obtain the Relative
Value vector. The calculation of the Ranking of CMSP is as follows
Table: 2.12 The relative value vector for four factors.
Sno Factor R B T L V M 1 Network 0.12 0.09 0.07 0.06 0.90 0.03 2 Price 0.03 0.05 0.02 0.05 0.06 0.06 3 Promotion 0.01 0.03 0.01 0.02 0.02 0.04 4 Evidence 0.01 0.02 0.01 0.01 0.02 0.02 0.18 0.19 0.11 0.16 0.20 0.16 Source: research survey findings
As per the above parameters Vodafone limited is ranked first, Bharti Airtel is ranked second, Reliance Infocom is ranked third, Loop Mobile telecom and
MTNL are ranked fourth and Tata Tele services is ranked last. It can be seen that the CMSP ranked first and second are GSM where as the last is a CDMA operator.
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12.8 Suggestion to bridge the gap
There is an urgent need to focus on the proper management of the
spectrum with an emphasis to improve the Service Quality.
The CMSP shall optimize the radio frequency network to improve the
coverage. The existing dark spots shall be covered immediately.
The call centre shall be made more responsive; there is an urgent need
to improve the first time resolution.
The CMSP shall start working on measurement of the quality of
experience
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Chapter -XIII Conclusions and Recommendations
13.1 Conclusions
13.2 Recommendations
13.3 Limitations
13.4 Future Scope for research
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Chapter -XIII Conclusions and Recommendations
13.1 Conclusions
The main aim of this research study was to do a comparative analysis of the customer service provided by the CMSPs in Mumbai region. The following conclusions are arrived:
i) The telecom regulation is still evolving in India.
ii) There is a crowd of cellular Mobile Service Providers (CMSPs) in
Mumbai region with eighteen of them providing Cellular Mobile Service
(CMS) to a population of 16 million.
iii) The allotment of the spectrum is not done efficiently.
iv)The majority of the customers are not aware about telecom
regulatory authority of India (TRAI). The entire customer perceptions
are not included in the quality of service parameters used by TRAI, it
talks about the technical parameters only.
v) The CMSPs are neither meeting TRAI service quality parameters
nor customers expectations. There is a gap between the perceptions
and expectations in all the eight dimensions of service quality. The
customers are not satisfied with the quality of customer service
provided by them in Mumbai region.
vi) The quality of the customer service provided by M/s. Vodafone
Limited is most preferred while that provided by M/s. Tata Teleservices
limited is least preferred.
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viii) The quality of customer service offered by GSM service providers,
was found better than CDMA providers.
ix) The price and quality of network offered by CMSP; influences the
perceptions of the customer to a great extent. The customers are
looking for mobile service which is reliable and innovative.
13.2 Recommendations
The important recommendations of this research study are listed below:
i) There is an immediate need to take steps to make the process of
cellular mobile telephone service (CMTS) licensing more transparent
and friendly.
ii) The mergers and acquisitions should be permitted; new licenses
shall not be issued in the near future.
iii) The process of licensing and allotment of spectrum shall be
delinked. There is a need to stream line the spectrum allocation
process, a technology neutral approach is recommended.
iv) The spectrum shall be allotted in the same frequency band so that
the CMSP can design cellular mobile networks which support better
quality of customer service.
v) The existing TRAI service quality model needs modification to
incorporate all the customer’s perceptions.
vi) It is suggested to give incentives to CMSPs who maintain better
service quality; this will go in a long way in improving the quality of
mobile service.
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vii) There is an urgent need for all the CMSPs to reduce the gap
between the customer’s perceptions and expectations.
viii) The TRAI should start focusing on the quality of experience instead
of quality of service.
13.3 Limitations of the Study
The limitations of this research study are given below:
i) The research proposes a comparative analysis of the customer
service provided by six out of the eighteen CMSPs in Mumbai region
which are in operation for the last three years, having more than 5%
market share and more than 0.5 million mobile connections. As per the
above all the CMSPs are not included.
ii) The findings of the research are based entirely upon the study
conducted for the CMSPs in Mumbai region and hence will not be
applicable to any other metro license area. If this research is done
across India one may arrive at results with higher confidence level.
iii) The perceptions and expectations of the customers keep on
changing. A number of new CMSPs are about to roll out mobile
services in Mumbai.
iv) The customers are using mobile service of more than one CMSP.
v) The quality, ease of use and service capabilities of the mobile
handset has a major impact on service quality regardless of the quality
of the network. If the mobile handset lacks the capability to provide the
service offering, it will result in an unsatisfied user.
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vi) The ranking of CMSPs on the quality of customer service will
change from time to time.
13.4 Future Scope for Research
The future scope for research is given below:
i) This research is focused on the quality of the customer service
provided by six CMSP in Mumbai region. This research can be done
for all the CMSPs in Mumbai. The research can be repeated for other
metros and results compared.
ii) There is an urgent need to ascertain the contribution of the mobile
handsets in the quality of customer service.
iii) A research study can be done on all the seven P on services
marketing to gain a better clarity.
279
Bibliography
[1]1 This study was done by Wavermen et al., in the year 2005, at the London business School. [2]2 The number of the telephone connections per 100 populations.
[3]3Customer service is the provision of service to customers before, during and after a purchase. According to Turban et al. (2002), “Customer service is a series of activities designed to enhance the level of customer satisfaction that is, the feeling that a product or service has met customer expectation.".
[4]4 CDMA (Code-Division Multiple Access) refers to any of several protocols used second-generation (2G) and third-generation (3G) wireless communications. It is a form of multiplexing, which allows numerous signals to occupy a single transmission channel, optimizing the use of available bandwidth. The technology is used in ultra-high-frequency (UHF) cellular telephone systems in the 800-MHz and 1.9-GHz bands.
[5]5 GSM (Global System for Mobile communication) is a digital mobile telephony system that is widely used in Europe and other parts of the world. GSM digitizes and compresses data, then sends it down a channel with two other streams of user data, each in its own time slot. It operates at either the 900 MHz or 1800 MHz frequency band.
[6]6 GSM Operators: Airtel, Vodafone limited (formerly Hutch/Orange/Max Touch) , Loop Mobile, Reliance Infocom, Aircel, Virgin GSM, ETISALAT, Uninor and Videocon. CDMA Operators Reliance Infocom, Tata Indicom, Garuda, Virgin Mobile and MTS.
[7]7 MTNL also offers CDMA services at very small scale hence it is taken as a GSM operator for this study.
[8]8 Telegraph uses electrical signals, usually conveyed via telecommunication lines or radio. The telegraph networks permits instantly transmit messages across both continents and oceans, with widespread social and economic impacts.
[9]9 Diamond Harbour is in the southern suburbs of Kolkata, on the banks of the Hooghly River quite near where the river meets the Bay of Bengal. This small town is a popular weekend tourist spot, this charming place was named Diamond Harbour by British.
[10]10 The East India Company was a joint-stock company that was formed by Britishers initially for pursuing trade with the East Indies, but that ended up trading mainly with the Indian subcontinent and China. The Company also came to rule large areas of India, exercising military power and assuming administrative functions, to the exclusion, gradually, of its commercial pursuits; it effectively functioned as a mega corporation. [11]11 The Government organization entrusted with the construction and maintenance of roads, bridges, and government buildings. [12]12 As per the data available in the DOT 2010-11 years book supplement. [13]13 The subjects of administration in INDIA are divided in three lists the centre list, the state list and the common list. The government of India deals with the subjects in the centre list.
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[14]14 In 1990 Shri Chandra Sekhar Prime minister of India set up the telecom restructuring committee better known as the Athreya committee to get an independent view on restructuring. Mr. Athreya opined that telecom in India needs three types of intuitions policy making, regulatory and field oriented.
[15]15 For a variety of purposes, India's telephony regulators have divided the country up into a number of regions, called 'Telecom Circles' or 'Telecom Service Areas'. The telephone numbers and tariff plans are same for one telecom area.
[16] 16 The Mumbai region consists of Mumbai, Greater Mumbai, Thane, Kalyan, Navi Mumbai, Dombivili and Bhyander.
[17]17 BPL Mobile Communications is the country’s oldest mobile telecom service provider been established in 1994 and currently operates in Mumbai, with over 3 million subscribers. However, BPL Mobile was renamed to Loop Mobile in March 2009, following the expiry of its brand-use agreement with the TPG Nambiar-owned BPL Group. It has consistently met and exceeded TRAI benchmarks, and is now ISO 9001:2008 certified. Loop Mobile Mobile has had several firsts to its credit in the Value-added service (VAS) space which are technologically state-of-art and yet customer friendly.
[18]18 In 1992, Hutchison Whampoa and its Indian business partner Max Group established a company that in 1994 was awarded a license to provide mobile telecommunications services in Bombay (now Mumbai) and launched commercial services as Hutchison Max in November 1995.
[19]19 In this regime a fixed license fee was charged by DoT to the operators irrespective of the revenue earned by them. [20]20 In this regime the CMSP were supposed to pay a percentage of the AGR (Annual Gross Revenue) on yearly basis. [21]21 The telecom connectivity between CMSP and BSO for routing the mobile calls from one net work to another. [22]22 As per the TRAI press release 2010-11. [23]23 The digital divide refers to the gap between people with the effective access to digital and information technology and those with very limited or no access at all. [24]24 The region covered by each base station is known as its cell .There are five different cell sizes in a GSM network, macro, micro, Pico, femto and umbrella cells. The coverage area of each cell varies according to the implementation environment.
[25]25 Radio is the transmission of signals through free space by modulation of electromagnetic waves with frequencies below those of visible light.
[26]26 Every time a mobile or portable cellular subscriber passes from one cell into another, the network automatically switches coverage responsibility from one base station to another. Each base-station transition, as well as the switching processor sequence itself, is called handoff. In a properly functioning network, hand off occurs smoothly, without gaps in communications and without confusion about which base station should be dealing with the subscriber. The call is made over from one cell to another in such a way that the conversation does not break.
[27]27In GSM Roaming is defined as the ability for a cellular customer to automatically make and receive voice calls, send and receive data, or access other services, including home data services, when
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travelling outside the geographical coverage area of the home network, by means of using a visited network.
[28]28 A method to provide access to same resource will be given to more than one user.
[29]29 Bandwidth (signal processing) or analog bandwidth, frequency bandwidth or radio bandwidth: a measure of the width of a range of frequencies, measured in hertz.
[30] 30 FDMA allows multiple users simultaneous access to a transmission system, Frequency Division Multiple Access. It gives users an individual allocation of one or several frequency bands, or channels.
[31]31 Carrier signal: A frequency in a communications channel modulated to carry analog or digital signal information. They carry the mobile traffic.
[32]32 FDMA (frequency division multiple access) is the division of the frequency band allocated for wireless cellular telephone communication into 30 channels, each of which can carry a voice conversation or, with digital service, carry digital data.
[33]33 The burst period is used for carrying data where as the others are used for control information.
[34]34 A subscriber identity module or subscriber identification module (SIM) is an integrated circuit that securely stores the service-subscriber key (IMSI) used to identify a subscriber on mobile telephony devices (such as mobile phones and computers).
[35]35In July 1985, seven industry veterans came together in the den of Dr. Irwin Jacobs’ San Diego home to discuss an idea. Those visionaries—Franklin Antonio, Adelia Coffman, Andrew Cohen, Klein Gilhousen, Irwin Jacobs, Andrew Viterbi and Harvey White decided to build “Quality Communications” which evolved into one of the telecommunications industry’s greatest start-up success stories: QUALCOMM Incorporated. It plays a central role in the rapid adoption and growth of 3G and next.
[36]36 A code is a rule for converting a piece of information into another form or representations. [37]37 Is used to hold and protect all subscriber data necessary to receive wireless services. The customers may remove the RIUM cards from one phone and insert them into another without the loss of data. This portability makes it easy for them to change the phones while keeping the services of same operator. [38]38 Refers to a feature of the CDMA where a cell phone is simultaneously connected to two or more cells during a call. [39]39 The average number of the minutes used per month [40]40http://www.brightsideofnews.comnews/2010/the-five-billion-world-analysed.aspc. [41]41 Communities Dominate brands news paper August 6 2010. http://communities- dominate.blogs.com/brands/ [42]42 The union cabinet of India approved Unified license regime for fixed line and mobile telecom in November 2003. In this regime the service providers were permitted to offer both landline and mobile services under one license after paying additional fees. [43]43 This is a method of the charging used by the mobile operators in India where the call originator has to pay. [44]44 The facility to keep the wireless devices connected even when the customer travels from one country to another. This allows the customers to make and receive calls from almost anywhere in the world and abroad.
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[45]45 The CMSP have to 3% of AGR (annual gross return) up to 6.2 + 6.2 MHz, 4% to 15 + 15 MHz. [46]46 The dual SIM offers the capability in which two live SIM cards can function simultaneously with features like call hold and swap, providing real time switching facility between the SIM at the touch of a button. [47]47 Is the type of marketing where a large amount of the money is spending on advertisements to every one? [48]48 Source of data TRAI SURVEY Report 2009-10. [49]49 The specific area allotted to a particular manager for sale. [50]50 The mobile merchandise consists of SIM cards, recharge coupons and value added services. [51]51 A software used by the distributors and CMSP for book keeping, sales and purchase, multi stock management and other business use. [52]52 The direct channel is used by the CMSP for selling new connections, recharge coupons and other value added services directly to the end customers. The retailer and distributors are not employed in this channel. [53]53 The content is a textual, visual or aural that is encountered as part of the user experience on websites. It may include the text, sound, images, video and animations. The agencies which provide the contents are called content providers. [54]54A traditional street side building that deals with the customers face to face in an office or store that is in an office that the business owns or rents. [55]55 When a marketer decides to appoint the channel members in the distribution channel then they have to take care of the needs of the channel members along with the need of his customers giving equal importance to both. .
[56]56 The Capability Maturity Model (CMM) was created after study of data collected from organizations that contracted with the U.S. Department of Defense, who funded the research. This model became the foundation from which CMU created the Software Engineering Institute (SEI). Like any model, it is an abstraction of an existing system.
[57]57 A best practice is a method or technique that has consistently shown results superior to those achieved with other means, and that is used as a benchmark. In addition, a "best" practice can evolve to become better as improvements are discovered. Best practice is considered by some as a business buzzword, used to describe the process of developing and following a standard way of doing things that multiple organizations can use.
[58]58 Benchmarking is the process of comparing one's business processes and performance metrics to industry bests and/or best practices from other industries. Dimensions typically measured are quality, time and cost. [59]59 The core product in the case of the mobile services consists of the network. [60]60 The internet and computers are used for offering the self service option to the mobile customers. [61}61 The services like SMS, Ring tones, news astrology etc. [62]62 The services offered from the customer service centers. [63]63 The call centre is a central place where all the calls are received from the customers. The call centre personnel are equipped to offer information and provisioning of the mobile services. [64]64 The sales outlet consists of the distributors, retailers and company owned shops.
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[65]65 The CMSP in Mumbai are offering tariff schemes in which the cost of the mobile handset is subsidized. [66]66 The intangible part consists of the services offered from the call centers and the sales outlets. [67]67 Adopted from “service sector Indian perspective” by Chattaranjan Bhattacharjee. [68]68 The interaction between the customer and the service provider. [69]69 The provider is the one who interacts with the customers. The provider is the face of the company and represents the company. [70]70 The computer software and hardware used by the CMSP to provision the service needs of the customers. [71]71 The deterioration in quality of service acceptable by the customer during busy hour. [72]72 The personal needs of the mobile services vary from customer to customer. [73]73 http://www.indiaonlinepages.com/population/india-current-population.html [74]74 A part of the water body along the shore deep enough for anchoring a ship situated such that it prevents the ships from winds. [75]75 An island group or is a chain or cluster of islands.
[76]76 Koli, as the fisher folk are known in Mumbai, they are known to be easily provoked. The kolis speak a local variation of Konkani which is a dialect of Marathi.
[77]77 The states in India are divided into small geographical areas called districts. The district is headed by a Deputy Commissioner and has three subdivisions. These districts are meant only for revenue collection & Administration.
[78]78 The name Mumbai is an eponym, derived from Mumba or Maha-Amba the name of the Koli goddess Mumbadevi and Aai, mother in Marathi. [79]79 GDP refers to the market value of all the final goods and services produced within a country in a given period of time. The source of data is Wikipedia. [80]80 Indian National congress was founded on 28th December 1885. It is the largest political party of India which influenced the Indian National movement. [81]81 The system carries more than 6.9 million commuters on a daily basis. It has one of the highest passenger densities of any urban railway system in the world. The trains plying on its routes are commonly referred to as local trains or simply as locals by the general populace. [82]82 As per the survey done by the researcher in 2009-2010 [83]83 Data source http://www.indiaonlinepages.com/population/mumbai-population.html [84]84 The population density is estimated to be about 20482 persons per square kilometer.
[85]85 Marathi is an indo Aryan language spoken by the Marathi people of western and central India. It is the official language of Maharashtra. It has the fourth largest number of speakers in India. [86]86 Recycling is the processing of the used materials into new products to prevent the wastage of potentially useful materials, reduce the consumption of the fresh raw materials, and reduce energy consumption and pollution. The plastic, cardboard, glass, batteries, computer parts are mostly recycled here. [87]87 Established in 1994 in Indian market, Hutchison Essar, an Essar group and Hutchison Whampoa undertaking, is one of the leading cellular service providers. Having its services in five continents, Hutch was among the companies that started cellular services in India. Hutch provides both postpaid and
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prepaid cellular services with lots of value added services to its customer base. With a total market share of 22%, Hutch's customer base amounts to 2.44 crores subscribers. Essar Group has a turnover of over US$ 2.2 billion and the enterprise value of US$ 15 billion. [88]88 Since 1983, Hutchison Whampoa Limited is into mobile business in Hong Kong and now has more than 40 million customers. Vodafone limited is acquiring Hutchison Telecomm International Limited, a subsidiary of Hutchison Whampoa Limited, with 33% stake in the company, changing Hutchison Essar to Vodafone limited Essar. [89]89 In 1982 Max India limited was incorporated on 5th Feb 1982 with a vision of multi dollar business enterprise. It is driven by the spirit of the enterprise and focused on people and service oriented business. The company’s vision is to be one of the most admired companies for service excellence. [90]90 A CMSP with the brand name Orange was a leading GSM service provider in India. Unlike the other operators it focused on the postpaid segment as its main growth catalyst. [91]91 A small short digit code of five digits is used by the CMSP in INDIA for providing the VAS. Example 58888, this is used the times group to provide news and entrainment services to the mobile customers. [92]92 IBM is an American multinational technology and consulting firm head quartered in Armonk New York. It manufactures and sells computer hardware and software and it offers infrastructure hosting and consulting services in the areas ranging from the main frame to the nano technologies. [93]93 Reverse innovation is a term referring to an innovation seen first, likely to be used first in the developing countries before spreading to the industrialized world. The term was introduced by Jeffery Immelt Chief Executive Officer General Electric, Vijay Govindrajan and Chris Trimble Professors at Dart Mouth Tucks School of Business. [94]94 Is the service provided by the CMSP, which can be used to conduct commerce using the mobile handset. It is any transaction, involving the transfer of the ownership or rights to use goods or services, which can be initiated or completed with the help of the mobile handset. [95]95 The passing of the product down the chain from the distributor to the customer is known as the distribution channel or the channel. Each channel has its own specific needs. The direct sales channel is controlled by the CMSP themselves. [96]96 The FoS SIM is used by the field officer sales. [97]97 The SIM used by retailers for transferring recharge coupons in electronic form via the SMS. [98]98 The Tata group is an Indian multinational conglomerate company head quartered in the Bombay house in Mumbai in India. It is one of the largest companies in India by marketing capitalization and revenue .The group has operations in 80 countries in six continents. It is 11th most reputed country in the world. [99]99 CDMA 1x refers to the number of the times the of 1.25 Mhz channel, while RTT stands for radio transmission technology it is also called 3G1X, or IS 2000. [100]100 The MTNL has divided the area of Mumbai in nine zones South, Central, North, West-I, II and III, East-I,II and Navi Mumbai. The telephone in a particular zone starts with common first digit. [101]101 The SMS Services are widely used by the Banking and the marketing sector industry to keep in touch with their customers.
[102]102 SERVQUAL or RATER is a service quality framework. It was developed in the mid eighties by Zeithaml, Parasuraman & Berry. It was originally measured on 10 aspects of service quality: reliability,
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responsiveness, competence, access, courtesy, communication, credibility, security, understanding the customer and tangibles. It measures the gap between customer expectations and experience.
[103]103 The Analytic Hierarchy Process (AHP) is a structured technique for organizing and analyzing complex decisions. Based on mathematics and psychology, it was developed by Thomas L. Saaty in the 1970s and has been extensively studied and refined since then. [104]104 the marketing mix was coined in 1953 by Neil Borden in his American management association presidential address. The original concept of the marketing mix belong to James Culliton who in 1948 described the role of the marketing manager as a mixer of ingredients
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Appendix-I
“ “Survey on Customer Perception and Expectations of Mobile services in Mumbai”
SECTION – A 1)Name 2) Male / Female Gender
3) Mobile 4) Type GSM / CDMA Number
5) Age Under 18 to 24 25 to 34 35 to 44 yrs 45 to 54 +55 yrs Group 18yrs yrs yrs yrs
6) Educational 10+2 Diploma Graduate Post Doctorate Qualifications Graduate
7) Monthly Less than More than More than More than More than Income 10,000 20,000 30,000 40,000 50,000
8) Student Unemployed Self Service Business House Profession Employed wife
9 ) Type of Post Prepaid 10) Number One More than Subscription paid of one connections
11) You are resident of which Zone of Mumbai, Navi Mumbai, Thane, Kalyan and Dombivilli ? a) South Zone (Cuffe Parade, Cooperage, Fountain, City, Kalbadevi, Mandvi) b) Central Zone ( Malbar Hill, Gamdevi, Mazgaon). c) North zone (Wadala, Curry Road, Byculla, Prabhadevi, Worli, Shivaji Park, Sion). d) West-I zone (Bandra, BKC, Khar, Vileparle, Andheri, Versova, Jogeshwari). e) West –II Zone ( Goregaon, Gokuldham, Marol, Sakinaka, Sakivihar). f) West –III Zone (Borivali, Kandivali, Malad, Mira Road, Bhayander). g) East-I (Ghatkopar, Powai, Chembur, Mankhurd). h) East-II (Thane-Charai, Wagle Estate, Mulund). i) Navi Mumbai (CBD Belapur, Vashi). j) Kalyan and Dombivili.
12) Any other Comments:
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SECTION – B Directions: This section of survey deals with expectations and perception of mobile services provider by your operator. Please show the extent to which you think your service provider is offering services and what you expect from him. The quality of service and expectations can be rated on a seven point scale. If you strongly disagree/low then circle 1, if you strongly agree/High than circle 7. Mark the number which shows your opinion about mobile services. Expectations from Please answer the following Perception of services Service Provider. questions listed Offered by Service Provider. ______Below related to ______Low High Expectations and Perceptions Strongly of services provided by your Strongly mobile service Disagree Provider. Agree 1 2 3 4 5 6 7 1) When your service 1 2 3 4 5 6 7
provider promises to do Something by a certain time, it does so. 1 2 3 4 5 6 7 2) When you have a problem, 1 2 3 4 5 6 7
your service Provider shows a sincere effort in solving it.. 1 2 3 4 5 6 7 3) Your service provider 1 2 3 4 5 6 7
performs the service right the first time. 1 2 3 4 5 6 7 4) Your service provider 1 2 3 4 5 6 7
provides its services At the time it promises to do so. 1 2 3 4 5 6 7 5) Your service provider 1 2 3 4 5 6 7
keeps customers Informed about when services will be performed. 1 2 3 4 5 6 7 6) The employees of your 1 2 3 4 5 6 7
service provider give Prompt services. 1 2 3 4 5 6 7 7) The employees of your 1 2 3 4 5 6 7
service provider are always willing to help. 1 2 3 4 5 6 7 8) The employees of your 1 2 3 4 5 6 7
service provider are never too busy to respond. 1 2 3 4 5 6 7 9) The behavior of the 1 2 3 4 5 6 7
employees in your service provider instills confidence in you. 1 2 3 4 5 6 7 10) You feel safe in your 1 2 3 4 5 6 7
transactions with your Service provider.
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1 2 3 4 5 6 7 11) Employees in your 1 2 3 4 5 6 7
service provider are Consistently courteous with you. 1 2 3 4 5 6 7 12) Employees in your 1 2 3 4 5 6 7
service provider have the knowledge to answer your questions. 1 2 3 4 5 6 7 13) Your service provider 1 2 3 4 5 6 7
gives you individual attention. 1 2 3 4 5 6 7 14) Your service provider 1 2 3 4 5 6 7
has employees who Give you individual attention. 1 2 3 4 5 6 7 15) Your service provider 1 2 3 4 5 6 7
have your best interest At heart. 1 2 3 4 5 6 7 16) Employees in your 1 2 3 4 5 6 7
service provider Understand your specific needs. 1 2 3 4 5 6 7 17) Your service provider has 1 2 3 4 5 6 7
modern looking equipment. 1 2 3 4 5 6 7 18) Your service provider’s 1 2 3 4 5 6 7
physical activities are appealing. 1 2 3 4 5 6 7 19) Your service provider’s 1 2 3 4 5 6 7
employees appear neat. 1 2 3 4 5 6 7 20) Materials associated with 1 2 3 4 5 6 7
the services (such as pamphlets or statements ) are visually appealing at your service provider. 1 2 3 4 5 6 7 21) Your service provider has 1 2 3 4 5 6 7
convenient Business hours. 1 2 3 4 5 6 7 22) Your service provider is 1 2 3 4 5 6 7
able to activate Requested services in reasonable time ?
2 3 4 5 6 7 23)Your service provider responds to price 1 2 3 4 5 6 7
1 and
product innovations as compared to competition ? 1 2 3 4 5 6 7 24) Your service provider adequate 1 2 3 4 5 6 7
Customization for using Value Added services?
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1 2 3 4 5 6 7 25) The network coverage provided by 1 2 3 4 5 6 7
your service provider is proper? 1 2 3 4 5 6 7 26) Your service provider’s network 1 2 3 4 5 6 7
support voice calls with acceptable clarity? 1 2 3 4 5 6 7 27) Are you easily reachable by others with 1 2 3 4 5 6 7
out difficulty? 1 2 3 4 5 6 7 28)Your service provider meets all the 1 2 3 4 5 6 7
service level Agreement? 1 2 3 4 5 6 7 29) What is over all service quality that you 1 2 3 4 5 6 7
have experienced from your service provider ?
30) Any other comments:
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SECTION –C Directions: This section of survey deals with ranking of the Importance one service quality parameter as compared to the other. The rating scale is shown below in detail. 1) Please rank the Importance of Network quality as compared to Promotion on a nine point scale. Network Promotion Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
2) Please rank the Importance of Network quality as compared to Price on a nine point scale. Network Price Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
3) Please rank the Importance of Network quality as compared to service provider’s People on nine five point scale. Network People Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
4) Please rank the Importance of Network quality as compared to service provider’s Processes used for service delivery on a nine point scale. Network Processes Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
5) Please rank the Importance of Promotion as compared to Price on a nine point scale. Promotion Price Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
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6) Please rank the Importance of Promotion as compared to service provider’s People on a nine point scale. Promotion People Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
7) Please rank the Importance of Promotion as compared to Processes used by the service provider for service delivery on a nine point scale. Promotion Service Delivery Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
8) Please rank the Importance of Price as compared to service provider’s People on a nine point scale. Price People Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
9) Please rank the Importance of Price as compared to Processes used by the service provider for service delivery on a nine point scale. Price Service Delivery Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
10) Please rank the Importance of service provider’s People as compared to Processes used by service provider for service delivery on a nine point scale. People Process Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
11) Any other comments:
298
SECTION –D:(Network Quality) Directions: This section of survey deals with ranking of the Importance one service quality parameter as compared to the other. The rating scale is shown below in detail. 1) Please compare Net work quality of Airtel as compared to Vodafone limited. Airtel Vodafone limited Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
2) Please compare Network quality of Airtel as compared to Reliance Infocom. Airtel Reliance Infocom Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
3) Please compare the Network quality of Airtel as compared to Loop Mobile. Airtel Loop Mobile Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
4) Please compare the Network quality of Airtel as compared to Dolphin. Airtel Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
5) Please compare the Network Quality of Airtel as compared to Tata. Airtel Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
299
6) Please compare the Network Quality of Vodafone limited as compared to Reliance Infocom. Vodafone limited Reliance Infocom Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
7) Please compare the Network Quality as Vodafone limited compared to Loop Mobile. Vodafone limited Loop Mobile Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
8) Please compare the Network Quality of Vodafone limited compared to Dolphin. Vodaphone Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
9) Please compare the Network Quality of Vodafone limited as compared to Tata. Vodaphone Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
10) ) Please rank the Network Quality of Reliance Infocom compared to Loop Mobile. Reliance Infocom Loop Mobile Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
300
11) ) Please rank the Network Quality of Reliance Infocom compared to Dolphin. Reliance Infocom Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
12) ) Please rank the Network Quality of Reliance Infocom compared to Tata. Reliance Infocom Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
13 ) Please rank the Network Quality of Loop Mobile compared to Dolphin. Loop Mobile Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
14 ) Please rank the Network Quality of Loop Mobile compared to Tata. Loop Mobile Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
15 ) Please rank the Network Quality of Dolphin as compared to Tata.
Dolphin Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor Favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
301
SECTION –E (Price) Directions: This section of survey deals with ranking of the Importance one service quality parameter as compared to the other. The rating scale is shown below in detail. 1) Please compare the Price of Airtel as compared to Vodafone limited . Airtel Vodafone limited Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor Favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9 2) Please compare the Price of Airtel as compared to Reliance Infocom. Airtel Reliance Infocom Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor Favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
3) Please compare the Price of Airtel as compared to Loop Mobile. Airtel Loop Mobile Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor Favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
4) Please compare the Price of Airtel as compared to Dolphin. Airtel Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
5) Please compare the price of Airtel as compared to Tata. Airtel Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9 6) Please compare the Price of Vodafone limited as compared to Reliance Infocom. Vodafone limited Reliance Infocom Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
302
7) Please compare the Price of Vodafone limited compared to Loop Mobile. Vodafone limited Loop Mobile Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
8) Please compare the price of Vodafone limited compared to Dolphin.
Vodaphone Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
9) Please compare the Price of Vodafone limited as compared to Tata.
Vodaphone Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
10) ) Please compare the price of Reliance Infocom compared to Loop Mobile.
Reliance Infocom Loop Mobile Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
11) ) Please compare the price of Reliance Infocom compared to Dolphin. Reliance Infocom Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
12) ) Please compare price of Reliance Infocom compared to Tata. Reliance Infocom Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
303
13 ) Please compare the price of Loop Mobile compared to Dolphin. Loop Mobile Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
14 ) Please compare the price of Loop Mobile compared to Tata on a nine point scale.
Loop Mobile Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
15 ) Please Compare the price of Dolphin as compared to Tata. Dolphin Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
304
SECTION –F(Promotion) Directions: This section of survey deals with ranking of the Importance one service quality parameter as compared to the other. The rating scale is shown below in detail. 1) Please compare Promotion of Airtel as compared to Vodafone limited. Airtel Vodafone limited Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor Favor favor Strong favor favor Favor 9 7 5 3 1 3 5 7 9
2) Please compare Promotion of Airtel as compared to Reliance Infocom. Airtel Reliance Infocom Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
3) Please compare Promotion of Airtel as compared to Loop Mobile . Airtel Loop Mobile Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
4) Please compare the Promotion of Airtel as compared to Dolphin. Airtel Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9 5) Please compare the Promotion of Airtel as compared to Tata. Airtel Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
305
6) Please compare the Promotion of Vodafone limited as compared to Reliance Infocom. Vodafone limited Reliance Infocom Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9 7) Please compare the Promotion as Vodafone limited compared to Loop Mobile. Vodafone limited Loop Mobile Extreme Very Strongly Slight Equal Slight Strongly Very Extreme Favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
8) Please compare the Promotion of Vodafone limited compared to Dolphin. Vodaphone Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
9) Please compare the Promotion of Vodafone limited as compared to Tata . Vodaphone Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
10) ) Please compare the promotion of Reliance Infocom compared to Loop Mobile. Reliance Infocom Loop Mobile Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
11) ) Please compare the promotion of Reliance Infocom compared to Dolphin. Reliance Infocom Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
306
12) ) Please compare the Promotion of Reliance Infocom compared to Tata. Reliance Infocom Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
13 ) Please compare the Promotion of Loop Mobile compared to Dolphin. Loop Mobile Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
14 ) Please Compare promotion of Loop Mobile compared to Tata. Loop Mobile Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
15 ) Please compare the promotion of Dolphin as compared to Tata. Dolphin Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
307
SECTION –G (Physical Evidence ) Directions: This section of survey deals with ranking of the Importance one service quality parameter as compared to the other. The rating scale is shown below in detail. 1) Please compare the physical evidence of Airtel as compared to Vodafone limited. Airtel Vodafone limited Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
2) Please compare physical evidence of Airtel as compared to Reliance Infocom. Airtel Reliance Infocom Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
3) Please compare the physical evidence of Airtel as compared to Loop Mobile . Airtel Loop Mobile Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9 4) Please compare the physical evidence of Airtel as compared to Dolphin on a nine point scale. Airtel Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9 5) Please compare the physical evidence of Airtel as compared to Tata. Airtel Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
308
6) Please compare the physical evidence of Vodafone limited as compared to Reliance Infocom. Vodafone limited Reliance Infocom Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
7) Please compare the physical evidence of Vodafone limited compared to Loop Mobile. Vodafone limited Loop Mobile Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
8) Please compare the physical evidence of Vodafone limited compared to Dolphin.
Vodaphone Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
9) Please compare the physical evidence of Vodafone limited as compared to Tata .
Vodaphone Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
10) ) Please rank the physical evidence of Reliance Infocom compared to Loop Mobile.
Reliance Infocom Loop Mobile Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
309
11) ) Please rank the physical evidence of Reliance Infocom compared to Dolphin.
Reliance Infocom Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
12) ) Please compare the physical evidence of Reliance Infocom compared to Tata . Reliance Infocom Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9 13 ) Please compare the physical evidence of Loop Mobile compared to Dolphin. Loop Mobile Dolphin Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
14 ) Please rank the physical evidence of Loop Mobile compared to Tata . Loop Mobile Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
15 ) Please rank the physical evidence of Dolphin as compared to Tata.
Dolphin Tata Extreme Very Strongly Slight Equal Slight Strongly Very Extreme favor strong Favor favor Favor favor Strong favor favor favor 9 7 5 3 1 3 5 7 9
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