Will MMS hold the fort for GSM against CDMA?

BANGALORE: In the wake of Reliance Infocomm’s WLL service offer to make phone calls cheaper than a post card, cellular operators have slashed their long distance rates from Rs 9 to Rs 2.99 as the first step to fight back CDMA’s possible take over. Value added services like MMS among other value-added services are looked upon to match-up the non-voice value-added services offered by the CDMA players.

According to IDC (India) Limited, 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. It can be well accepted among tech-savvy, high-end mobile users, but, in a price-sensitive market like India, its utility is a big question among common people. It has been observed that even on the global level MMS is not as successful as SMS.

IDC(India) Limited, Head - Telecom Research, Parijat Chakraborty says, "MMS and other data services are not likely to be something to be used by common people in coming two/three years in India".

In a country like India, where utility of service plays a very big role, penetration as well as frequency of use of MMS is expected to be very low, at least in the initial couple of years. It’s likely to remain as a niche product catering to specific segments only. High cost per message would also play a big role here. 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 calls. MMS may help them in retaining top-end customers who are anyway not likely to shift to limited mobility immediately. To retain the low spenders, who are the major chunk of GSM subscriber base, they have to ensure competitive tariffs.

On the issue of the future of these two technologies, Parijat Chakraborty foresees that both GSM and CDMA are going to co-exist in India. A level-plying field would make both the parties competitive. According to him, "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."