Monday, May 19, 2003		Feature

GSM’s ace against CDMA?
Tribune News Service

GSM operators are trying to promote MMS and other value-added services to match-up the non-voice value-added services offered by the CDMA players, primarily Reliance. Can these value-added services really help the GSM players in retaining their subscribers from churning out?

According to IDC, it is unlikely that MMS will have enough potential to do the job sought after by GSM players. The assumption that MMS would do what SMS did a few years back in Indian mobile industry might not hold true. Globally also MMS is not as successful as SMS. MMS is likely to remain as a niche product catering to specific segments only. High cost per message would play a big role. Very low penetration and high cost of GSM handset models compatible with MMS would only add to this problem.

Therefore, even if GSM operators can establish MMS and other value-added services as their main weapons in battle against CDMA, its not going to give them much mileage in tackling the threat due to huge tariff difference in voice calls.

Both GSM and CDMA are going to co-exist in India. A level-playing field would make both parties competitive. According to Parijat Chakraborty, Head - Telecom Research, IDC (India) Limited: "Mobile telephony industry is going behave similar to the two-wheeler industry today. You have scooters and motorcycles, which are different in technology and specific characteristics; however, both are catering to the basic need of transportation. Consumers would choose one based on his perception and aspiration, hence, marketing is going to be the name of the game, not technology."