"India Calling Cards" - War Has Begun

Just last year, not long long ago, people like me had not much options when it used to come to "India Calling Cards". Reliance card used to cost 13 cents a minute (12.9 per min. precisely) to call to India. There were few other cards available but they suffered because of quality or hidden costs etc.

Off of my head, 3 million Indians must be staying in USA. Assuming on an average, per person uses 500 min. talk time a month to talk to folks back home in India.

This is 1.5 Bn min. per month or 18 Bn min. per year. So a rate of 13 cents a min. would fetch a fortune of 2.3 Bn USD. Add to it the growth factor -- we have seen 200% increases in the number of people flying to USA every year and making USA their abode for a short and or long term.

2.3 Bn USD with a growth rate of 200%...helluva money ... isn't it!

Now Reliance is no longer a monopolist here... the party was joined by Pingo, Airtell, and so many other wannabes... good news is the price per min. is getting pushed southwards.

Pingo offered a rate of 8 cents per min. with $5 free talk time on a referral, $20 free talk time on 3 friend referral. More the merrier!. My friends started spamming my mail boxes every other day with an invite from Pingo... Yo Pingo!!

Airtell.. dropped a bomb shell by launching a card with double talk time on purchase and on first recharge... rate is 7.6 .. more southwards...

Reliance slashed their rates to 7.8 (landline) and 7.4 (Reliance network)... straight 50% drop in rates ... welcome to survival driven market economy.

What next ... there are sites launched last week offering free calls to India as an entry strategy... Reliance is investing 1.6 Bn USD in building Optical Network Infrastructure across the Atlantic.

So the fun for consumers and war for Telecom providers has really begun ....over the period, these companies will cover up their fixed costs and pass on variable costs not to the end user but the advertiser.

I guess the business model which would evolve over next 3/4 years is -

"Free Call to India with a initial 30 second advertising audio clip"

That's it...it is called passing on benefits directly to customer. I welcome that day... would you mind a red carpet?