> Bhairti Airtel may revise low-cost strategy in Africa
> In Telecom.paper 29-02-2012
> [Mobile World Congress 2012]
Bharti Airtel may devise a new strategy for the African market, following what it termed an unexpected response to its low-cost model developed in India. According to the Daily Nation, the mobile company told participants at the Mobile World Congress in Spain that it was surprised to find that the African market did not increase its talk-time, which was critical to supporting its low-cost model. MD Sunil Mittal said unlike India, they were surprised that in Africa, lower tariffs could not increase volumes. In Africa, subscribers use the money saved on lower calling rates to buy food and not to talk more. Mittal’s comments are supported by data from the Communications Commission of Kenya at the height of the price wars, which indicated that low calling rates failed to lift talk-time. The announcement is a signal that the firm could opt out of the low-cost model, which has forced mobile operators across most of the 17 countries it operates in Africa to follow suit. Airtel said Africa remains critical to its future growth. Mittal said Africa and other emerging markets need smartphones and tablets to be priced below USD 50 to allow the data evolution that is shaping up to turn into real growth.