Virgin targetting Indian Market

Virgin Mobile, Sir Richard Branson’s no-frills mobile brand, is preparing to enter India in a tie-up with the Tata conglomerate.
Ratan Tata, its chairman, is understood to be in talks with Virgin about the group becoming an exclusive franchisee of Tata Teleservices, Tata’s telecoms arm and India’s sixth-largest mobile operator.
The venture, which could be operating as soon as April, is expected to involve creating a business owned partly by Tata Teleservices.
The Branson talks mark the latest step in a race into India by Britain’s mobile operators, as they seek to cement their position in one of the world’s fastest growing economies. Vodafone, the world’s biggest mobile group by sales, is seeking a controlling stake in Hutchison Essar, another Indian mobile operator.
India is one of its largest untapped mobile phone markets. The country has a population of 1.1 billion but a mobile phone penetration rate of just 12 per cent, or 140 million subscribers.
Usage could triple in the next four years, some analysts believe. In the UK, where some users have more than one phone, the figure is more than 100 per cent.
Tata Teleservices, which operates under the Tata Indicom brand, has 8.6 million customers, or a 7 per cent share of the market.
It is thought that it regarded a tie-up with Virgin as a way of attracting more younger users.
Virgin Mobile, a “virtual operator” that does not have its own network, already operates in the United States through a joint venture with Sprint.
It is also in Australia and in France, through a tie-up with Carphone Warehouse, the high street chain founded by Charles Dunstone.
Plans for a flotation of Virgin Mobile USA were shelved in 2005 when it raised funds through the debt market.
In the UK the group, which has merged with NTL, the cable operator, uses the network of T-Mobile, the German-owned mobile business.
Vodafone has a 10 per cent holding in Bharti Tele-Ventures, India’s biggest mobile operator.
Indian players in the mobile market:
1 Bharti Tele-Ventures: 27.1 million subscribers, which eqautes to a 21.6 per cent market share
2 Reliance: 23.5 million/18.8 per cent market share
3 Hutchison India: 20.4 million/16.3 per cent market share
4 Tata Teleservices: 8.6 million/6.9 per cent market share