When Nobel-laureate EF Schumacher wrote Small Is Beautiful (As If People Mattered), cellular was certainly not in his mind. But the cellular operators are fast realizing that small is indeed beautiful. Perhaps much more beautiful than Schumacher imagined.
When cellular licences were being awarded, there was so much glamour and clamour for the Mumbai licence. Most aggressive forecasts, bids, and what not! Some even thought the rest was a waste. Today, Delhi has the lead. Whether it is maximum number of cars or cellphones, it is the same success story of small entrepreneurs behind them.
Recently, we were on a search for a small office building ... there were brokers and brokers but with a common factor ... all had a cell-phone, in fact some had two, one from each of the two operators ... just in case! When we looked for furniture ... again the same common factor. A conspicuous cell-phone. The common factor stretches beyond ... our lawyer carries one, our CA carries one, our freight agent carries one. No wonder it is the small wonder!
But for now, we leave aside the small wonder called cellphone ... and talk about the success story of the small business. Small business has come to mean big business to cellular operators. Not only world-wide, but in India too! Delhi is obviously the trend setter in India. Today, travelling in a Bombay suburban train if one sees a combination of "chappals" and "cell-phone", one cannot afford to scoff.
Most operators tend to launch with testimonial ads. Focus: Corporate Big Wigs! No doubt almost all CEOs become the first subscribers though I know several dogged exceptions. But where do the real numbers, usage, and revenue come from? It is from the humble pockets of small businesses with employees less than 10 sometimes; we include the self-employed too. In the first year of service, over 95 percent of the revenue may come from this segment. For cellular, small is big. Big market. It may take sometime for cellphones to travel down the corporate echelons.
In the "consumer" segment, it takes two to three years to reach "significant" level of penetration and airtime usage. We know, most people prefer to charge to official account. Consumer segment will mostly comprise of housewives, college going youngsters, and old people. Majority go for it as "status symbol" or "snob value" and sometimes for "security" reasons, mostly with very low airtime usage.
Today, small businesses and corporate segments account for about 70 percent of world cellular market and the consumer segment less than 30 percent. In some "not so highly dense" markets with about 10-12 percent (still quite big for us) penetration, small businesses have been seen to reach a cellular penetration of about 50 percent. While in "highly dense" market like Sweden with 30 percent cellular penetration, small businesses (less than 15 employees) have 85 percent penetration. Need we say more?
Cellular changes the way to business for a small businessman as he learns to manage his time better--the cellular way. With a cellphone he virtually carries his office around. Office and telephone do not tie him down anymore. He could devote more time with his clients and in travelling. For operator, it requires a customized concept selling to address and target each of sub-segments based on the pattern of daily activities which may differ for exporters, doctors, CAs, lawyers, estate agents, freight agents, courier services, contractors, etc. It may include specialized promotion for specific professions highlighting how the service can help in improving efficiency and business. In Delhi, I am told that almost 100 custom-agents subscribed to service en masse, even the same model of handset.
Today, traveling in a Bombay suburban train if one sees a combination of "chappals" and "cell-phone", one cannot afford to scoff. It is not just the basic unit of economic fabric but also the "big" star of cellular world. Schumacher wrote, "There is wisdom in the smallness if only on account of the smallness and patchiness of human knowledge... It is more important that everybody should produce something than that a few people should each produce a great deal... The task is to bring into existence millions of new work places in the rural areas and small towns."
"Cellular will play a leading role in this task in India," Mr Schumacher, "we assure you."
By Niraj K.Gupta, Voice and Data, October 1996.