2009-12-08

Is competition always good for the consumer?

These levels of growth is what is attracting many players to India. Now these new players are asking industry leader, Bharti, not to complain but comply with what is happening in the market - price reduction. These players think they are doing a great favour to the consumer.

India already has amongst lowest ARPUs  / Average Revenue Per Mobile User Per Month. What is being offered by the new players is entry pricing which over a period of time is unsustainable. Sooner than later, they all will go belly up and customers will have to run back to stable players, who then will have a chance to price as they like.

Competition is good for the consumer, but when it hurts profitability of the industry, it is neither desirable nor good for both the players and the consumer.

PS: Read this curious case of not wanting to listen to customers; because customers tell you what they already know. This case is about creating new and giving customers what they don't know.

2 comments:

arjun said...

Nice to see u blogging regularly with your usual sense of 'absoluteness'.

Arjun

itheabsolute said...

Thanks Arjun. Glad to know it is nice and not otherwise.

2009-12-08

Is competition always good for the consumer?

These levels of growth is what is attracting many players to India. Now these new players are asking industry leader, Bharti, not to complain but comply with what is happening in the market - price reduction. These players think they are doing a great favour to the consumer.

India already has amongst lowest ARPUs  / Average Revenue Per Mobile User Per Month. What is being offered by the new players is entry pricing which over a period of time is unsustainable. Sooner than later, they all will go belly up and customers will have to run back to stable players, who then will have a chance to price as they like.

Competition is good for the consumer, but when it hurts profitability of the industry, it is neither desirable nor good for both the players and the consumer.

PS: Read this curious case of not wanting to listen to customers; because customers tell you what they already know. This case is about creating new and giving customers what they don't know.

2 comments:

arjun said...

Nice to see u blogging regularly with your usual sense of 'absoluteness'.

Arjun

itheabsolute said...

Thanks Arjun. Glad to know it is nice and not otherwise.