Kerala Vision, the ISP with the largest network in Kerala, has unveiled a new set of tariffs, after its primary competitor BSNL converted its 449 promotional scheme into a regular scheme with unlimited validity.
BSNL last week converted its 449 promotional broadband scheme — which was initially valid only for six months — into a regular tariff scheme with unlimited validity and made available to all users.
In contrast, it was earlier available only to new users, and that too, for a period of only six months, after which they would be upgraded to the 599 (60Mbps) plan.
The ultra affordable 449 plan, also known as ‘Fiber Basic’, is BSNL’s primary weapon of choice against encroachment by private players such as Reliance Jio and Bharti Airtel.
It was introduced a year ago after Reliance Jio slashed its Jio Fiber tariffs by nearly 50% in late 2019. Under Jio’s new plans, India’s largest telecom operator was giving an unlimited, 30 Mbps connection at just Rs 399 (Rs 475 including GST).
Soon after unveiling the cheaper tariff plans, Jio’s monthly broadband additions went from around 30,000 new customers/month to 1 lakh per month and then to 2 lakh per month. Its nearest competitor, too cut its tariffs and now adds around 1 lakh new users per month.
BSNL did not initially respond to Jio’s new tariffs, but soon realized that its customers were sitting ducks for Reliance’s aggressive marketing department.
As a result, around a year ago, the state-owned company unveiled the Rs 449 BASIC Fiber plan on an experimental basis, offering largely the same benefits as the Jio plan.
At the same time, to prevent loss of revenue due to the down-migration of its existing customers to the cheaper scheme, it made the new plan applicable to new customers only, and that too, for a limited period.
However, over the last one year, the Indian fiber broadband market has seen a sea change.
On the one hand, COVID-19 has led to a sharp increase in demand for wired broadband services, while on the other, the competitive dynamics has changed due to the entry of Bharti Airtel into the LCO-market.
Bharti Airtel used to operate only through its own last mile network earlier, and was happy to add around 20,000 new users per month.
However, with Jio signing up 2 lakh new users, Bharti Airtel realized that it could not continue to rely entirely on its own last-mile network, and decided to take a leaf out of BSNL’s playbook by recruiting local cable operators as its resellers.
This has increased the competition for BSNL, as the same cable operator will now offer BSNL and Bharti Airtel’s plans side by side, and the user will be free to opt for either. For comparison, Bharti Airtel’s plans start at Rs 499 (plus GST) for an unlimited 40 Mbps offering.
Moreover, the strong demand for wired broadband services also means that companies can offer cheaper pricing as the volumes are much higher than earlier.
KERALA VISION RESPONDS
Meanwhile, all this competition has been bad news for Kerala Vision ISP, formed under the aegis of the Cable Operators’ Association of Kerala, comprising around 4000 small cable operators in the state.
In addition to KeralaVision plans, most LCOs in Kerala offer internet plans from various ISPs on their network, including those from RailWire, BSNL, Alliance and so on.
Out of these, BSNL’s plans were the most aggressive. Because of this, Kerala Vision started losing sign-up momentum, as its offerings were coming across as 20-25% costlier than those of BSNL.
The latest tariff card is aimed at resolving that issue.
Under the new plans announced by Kerala Vision, the cheapest offering will be a 30 Mbps plan priced at exactly the same price as BSNL’s Fiber Basic, or Rs 534 per month including GST.
While BSNL’s Basic Plan comes with a free landline connection with unlimited calling, it is not clear whether the Kerala Vision plan includes voice calling or not. Under its earlier tariff plan, only the more expensive plans used to come with bundled voice calling.
Another difference is that the BSNL plan has a fair usage cap of 3,300 GB per month, while the Kerala Vision ISP plan has an FUP of 4,000 GB. However, a regular home user is unlikely to consume more than 2,000 GB per month, and the majority do not even consume 1,000 GB.