Hutch Essar South invests Rs 200 crore in cell infrastructure

Chennai: In order to improve its service quality and taking into account the future needs, Hutchinson Essar South, the cellular telephony service provider in Chennai, has invested Rs 200 crore in expanding its infrastructure.

The company increased the number of cell sites to 208 in the city. "We deployed 73 cell sites in 45 days," says Sandip Das, CEO. "We invested around Rs 400 crore in our Chennai operations, if one includes the licence fee too. In the last one year our total investment in Chennai, Karnataka and Andhra Pradesh was around Rs 1,500 crore."

Didn't the company explore the possibility of sharing the infrastructure of other service providers in Chennai? "We did speak. But such sharing would place us at par with the existing players from day one, which we didn't want," says Das. "The Chennai operations will break even next year provided the current market trends prevail."

Launching its services in Chennai last year, Hutch has a subscriber base of 56,000 with post-paid accounting for 25 per cent and the balance being prepaid customers. For the service providers, post-paid is more favourable. "But the cost of supporting that is also high. It is the pre-paid that brings in more subscribers," he says.

Nation-wide the average revenue per post-paid user is around Rs 800 per month whereas it is Rs 250 in the case of pre-paid schemes. "Across the circles Hutch has the highest post-paid subscriber base," Das adds. Apart from the four metros the Hutch group is present in Karnataka, Andhra Pradesh and Gujarat.

Agreeing that Hutch in Chennai witnessed lots of subscriber churn, Das says: "We took a hard look at our subscriber base and cleansed it. Now our subscriber base consists of serious and quality users."