Telenor enters mobile market with 29-paise tariff

Norway-based Telenor, the world's sixth-largest mobile operator, has become the latest telecom operator to launch services in the world's fastest growing but also most crowded wireless market, with tariffs as low as 29 paise per minute for local calls and 49 paise for long-distance calls.

The company, which has a joint venture with India's Unitech Wireless, launched the services yesterday under the brand name Uninor. Telenor holds a 67.25-per ent stake in the venture.

''This is indeed a milestone in a longer journey to become a significant operator in India,'' Telenor's managing director for India Stein-Erik Vellan said. The service has been launched in seven circles and will be expanded later.

''Unitech Wireless has kicked off operations in Tamil Nadu, Kerala, Karnataka, Andhra Pradesh, UP East, UP West and Bihar (including Jharkhand), and will extend operations to more zones early next year,'' Vellan said.

Vellan said that even after factoring in the ongoing price war, the telco was confident of achieving an EBITDA break-even in three years and would have positive operating cash flow within five years of launch. ''We are targeting a market share of 8 per cent by 2018,'' he said.

Telenor Group president and chief executive Jon Fredrik Baksaas said the company would not offer a per-second billing plan, as it was not necessarily a feature customers were looking for. ''Our tariffs are more attractive, especially for those customers who want to talk longer,'' he said.

The company also said it expected its average revenue per user (ARPU) to be lower than the industry level in the near term before rising to the sector level by next year-end.

Vellan said the company was still examining whether it should bid for the upcoming 3G auction. He made it clear that the company would definitely not bid for an all India 3G spectrum licence.