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Per-second billing unsustainable: Aircel
Published on 15 Jan. 2010 11:47 PM IST
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Aircel Cellular, promoted by Malaysia’s Maxis Communications, on Thursday said it was targeting 100 million users by 2012, over three-fold increase from the current base of 31 million. However, Aircel’s strategy for subscriber addition will be data driven and not tariff driven. “Per-second billing is unsustainable. It constrains EBIDTA margins. We will see these tariffs for another year-and-a-half after which consolidation will set in,” Aircel COO Gurdeep Singh said after announcing an agreement with GTL Infrastructure to sell its towers. He pointed out that for operators, the cost per-minute is 40 paise and tariffs below 50 paise per minute did not make a business case. “With tariffs hitting all time low, only value-added services could increase revenues,” he said. Currently, data services constitute 7% of Aircel’s revenues and the company is targeting to take that to 11% by 2012. “Differentiation can come through only value-added services,” he said.

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