What does entry of Virgin Mobile means to Indian consumers?

For the last one month, there has been lot of buzz created around with the launch of Virgin Mobile into the Indian market, and many people have been comparing it with the likes of another UK telecom major, Vodafone.

However Virgin Mobile does not have neither the network nor the spectrum to start its mobile operations. It is just an agreement with Tata Teleservices wherein Virgin Group has a brand franchise arrangement targeted primarily at the youth segment.

Neither is the arrangement under MVNO (Mobile Virtual Network Operator) format. Under this format, companies buy airtime in bulk from service providers for resale to consumers. Virgin Mobile is just using Tata’s distribution network and complement its existing brand Tata Indicom.

According to a Morgan Stanley report, the offerings of Virgin Mobile are cheaper by 25-30% than similar schemes of competitors. Also, it has launched innovative schemese such as paying customers 10 paise for every minute of incoming calls they receive, contrary to olden days when you had to pay for an incoming call.

Even the TV advertisiements of Virgin Mobile have struch a cord with viewers owing to its smart placements and humour.

The Virgin Mobile service is currently available in select cities only and has been strategically focussed on high street stores and malls where there is more orientation towards youth.

In future, the offering may widen to cover more cities but the scale of operations and offers may be limited such as to have a niche customer base and also not to overlap with existing setup of Tata Indicom services.