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Ncell clinches No 1 spot from Nepal Telecom


KATHMANDU, MAY 05 -

It’s now official. Ncell—the country’s first private GSM mobile operator—is the No 1 player in the GSM mobile segment.

Telecom regulator Nepal Telecommunications Authority (NTA)’s latest MIS Report says that Ncell has toppled Nepal Telecom (NT) to become the GSM segment leader.

Interestingly, Ncell achieved this feat exactly a year after its massive rebranding exercise. The NTA’s latest statistics (as of mid-March) shows that Ncell subscriber base has touched 4.78 million mark, whereas NT has 4.71 million subscribers. Ncell has already declared that the number of its subscribers increased to over 5 million as of April 10.

It was the combination of several factors including aggressive marketing, rebranding exercise, launch of new services and infrastructure expansion that pushed Ncell to the numero uno position. The push started after Europe’s fifth largest telecom company Teliasonera acquired majority stake in Ncell (then Mero Mobile).

It took only six years for Ncell to topple Nepal Telecom from the number one spot. Ncell that appeared on the scene in 2005 made a giant stride—when it comes to increasing subscriber base—in the current fiscal year.

Until last fiscal year, difference between the subscriber base of the two operators—Ncell and NT—was around 1 million. However, since last fiscal year, Ncell aggressively started introducing new services and handsets targeting both low-end and high-end customers.

First it launched two cheap mobile handsets—a black and white model at Rs 999 and colour at Rs 1,199—targeting rural folks, which helped it expand subscriber base outside the Kathmandu Valley. This was followed by the launch of Blackberry—primarily targeting Kathmandu’s corporate segment—and 3G services.

And, these initiatives paid off. The company started narrowing the gap with NT’s subscriber base form this fiscal year. In the first eight months of FY 2010-11, Ncell added 1.84 million subscribers, whereas Nepal Telecom could add only 750,384.

The aggressiveness of Ncell is evident from the fact that it added 306,694 new subscribers in the eighth month (mid-February to mid-March) alone, when Nepal Telecom was able to increase its subscriber base by only 18,819. “This is our great success that we are able to attract a majority of customers to our quality network,” said Sanju Koirala, corporate communication manager of the Ncell. She added that customers’ trust on Ncell increased dramatically after the rebranding and introduction of flat tariff rate across the country.

The Ncell-NT competition is a classic example of how state-owned enterprises and private sector entities work. While NT was marred by weak management, government indecisiveness and timely completion of 3.5 million GSM project. Ncell invested heavily in infrastructure. It has earmarked $100 million for 2011 for infrastructure development.

“Occasional availability of NT’s SIM cards, its failure to distribute SIM cards as per the demand and Ncell’s aggressive marketing helped Ncell,” said a senior NTA official.

NTA says next year will see a fierce competition between the players with NT announcing big plans of increasing its subscriber base. The state-owned company is preparing to add 6 to 10 million GSM subscribers next fiscal year. It has said that it will also distribute 600,000 additional pre-paid SIM cards by the end of the current fiscal year. “Within one month, we will call a global tender to add 6-10 million subscribers,” said Kanhaiya Lal Gupta, deputy managing director at NT.

The fight for the supremacy between NT and Ncell has ultimately benefited the customers. Tariff has come down, availability of SIM cards has increased and new value added services are being launched by both operators. “The tariff will further come down because of the fierce competition,” said the NTA official.

Mobile telephony in Nepal is only 12 years old. NT succeeded in expanding telecom services and infrastructure to all parts of the country, while private players including Ncell played a key role in making telecom service affordable to common people.

subscriber base

Fiscal Year 2008/09

NT 3 million

Ncell 1.87 million

Fiscal Year 2009/10

NT 3.96 million

Ncell 2.94 million

Source: Nepal Telecommunications Authority
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