Interesting comments from MA Madhusudan, CEO of Virgin Mobile, to ET; he says that the company is has a revenue sharing agreement with Tata Teleservices, not a bulk minute purchase agreement, like MVNOs do. But, the clincher – “We are, in simple terms, operating and managing the brand Virgin Mobile for Tata Tele Services.”
So that confirms that that to tie-up with any other operator, Virgin Mobile will need Tata Teleservices’ approval (since they own the brand). So will Tata Teleservices take a revenue share from Virgin Mobile, since they own the brand? Or will they retain the Virgin brand exclusive, and prevent Virgin from tying up with any other mobile operator – particularly the new telcos?
Madhusudan says that they have no plans for an expansion yet. Frankly, I there isn’t much of a point to be an MVNOs in this market, since you’re restricted to one telco in a circle, and there is going to be quite a battle to acquire consumers as new telcos start rolling out operations.
He adds that the company has primarily added existing users – which comprise of 75-80 percent of their user base. This might primarily be because the brand targets the urban youth, many of whom were already mobile. Remember, Virgin is planning to launch more ad supported services in the coming months. Virgin Mobile is present in 60 cities, and has 21,000 retail outlets, and 50,000 retail outlets. They’re targeting 1000 cities and towns by next year, and 10,000 retail outlets. No numbers on their userbase, though
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