Documente Academic
Documente Profesional
Documente Cultură
A THESIS
Submitted to the
FACULTY OF BUSINESS MANAGEMENT & COMMERCE
PANJAB UNIVERSITY, CHANDIGARH
for the degree of
DOCTOR OF PHILOSOPHY
2007
PREET KANWAL
I consider it pleasure and privilege to pay regards and thanks to Dr. Suresh
Kumar Chadha, Professor, University Business School, Panjab University,
Chandigarh who supervised this work with critical insight and intellectual
acumen. Under his guidance, it always looked within my reach. In fact, without his
critical suggestions, encouragement and co-operation, this thesis would have not
touched its zenith.
I thank Prof. S.C. Vaidya, Chairman, University Business School, Panjab
University, Chandigarh and other members of the teaching faculty of this
department for their help and co-operation.
I am also thankful to Dr. Satish Kapoor, Dean, Faculty of Business
Management and Commerce for his support.
My thanks are also due to Sh. S.S. Bedi, Librarian in providing references
on the subject. As also to other members of non-teaching staff of the department for
their help.
I am also grateful to Dr. S.K. Sharma, Chairman, Department of Statistics,
who lent me his expertise at the time of analysis of data.
I would also acknowledge the help provided by subscribers, dealers and
telecom service providers in providing precious data and suggestions.
I express my gratitude to my parent in-laws and parents who motivated me
to carry my research to its culmination. This work couldn’t have been completed
without their blessings and encouragement.
I owe very special thanks to my husband, Narinder, for his unstinted
support and inspiration. I am thankful to my little kids, Hargun and Guragam, for
understanding the hard work involved in the research and bearing with me.
I am also thankful to M/s Kaizen Graphics for typing the thesis.
Above all, I am grateful to Almighty, without Whose grace I would not have
succeeded.
Preet Kanwal
TABLE OF CONTENTS
Acknowledgements
List of Tables
List of Figures
List of Abbreviations
CHAPTER – 1: INTRODUCTION
1.1 INTRODUCTION 1
1.2 GROWTH OF INDIAN TELECOM SECTOR: AN OVERVIEW 3
1.3 TRUST AND COMMITMENT AND TELECOM SECTOR 11
1.4 RATIONALE OF TRUST AND COMMITMENT 19
1.5 RESEARCH OBJECTIVES 20
1.6 TRUST AND COMMITMENT MODEL OF THE RESEARCH STUDY 20
1.6.1 Shared Value 21
1.6.2 Communication 22
1.6.3 Opportunistic Behaviour 23
1.6.4 The Consequence of Trust –Relationship Commitment 24
1.7 PROPOSED MODEL AND HYPOTHESES 25
1.8 NEED AND SIGNIFICANCE OF STUDY 28
1.9 RESEARCH METHODOLOGY 30
1.9.1 Research Problem 30
1.9.2 Scope of Study 30
1.9.3 Selection of Services 30
1.9.4 Questionnaires 30
1.9.5 Sample Design and Sample Size 30
1.9.6 Methods of Data Collection 31
1.9.7 Limitations of the Study 32
1.9.8 Analysis of Data 32
1.10 CHAPTER PLAN 38
3.1 INTRODUCTION 76
3.2 GLOBAL TELECOM INDUSTRY: AN OVERVIEW 76
3.3 TRENDS IN INDIAN TELECOM INDUSTRY 78
3.4 TRANSITION OF INDIAN TELECOM INDUSTRY 80
3.4.1 Objectives of the National Telecom Policy 82
3.4.2 Telecommunication Services 83
3.4.3 Revenue Analysis 84
3.4.4 Teledensity 85
3.4.5 Value Added Services 86
3.4.6 Village Telephones 87
3.4.7 Thrust on broadband, high-speed Internet 87
3.4.8 Growth in Telecom manufacturing 88
3.4.9 Broadcasting sector 88
3.5 PRIVATIZATION AND DISINVESTMENTS OF BASIC SERVICES 88
3.6 FOREIGN DIRECT INVESTMENT (FDI) 91
3.7 FUTURE GROWTH OPPORTUNITIES OF INDIAN TELECOM SECTOR 93
3.8 GROWTH OF TELECOM SECTOR IN PUNJAB 97
3.9 LEADING PLAYERS OF INDIAN TELECOM INDUSTRY 98
3.9.1 Airtel 101
3.9.2 Tata Teleservices Limited 102
3.9.3 Hutchison Essar Limited 105
3.9.4 Reliance Infocomm Limited 106
3.10 CONCLUSION 107
BIBLIOGRAPHY 271-294
APPENDICES i-xiv
Abbreviation Expression
GNP Gross National Product
GDP Gross Domestic Product
RBI Reserve Bank of India
ASCON Confederation of Industry Associated Councils
VAS Value Added Services
TRAI Telecom Regulatory Authority Of India
NLD National Long Distance
ILD International Long Distance
ARPU Average Revenue Per User
BSNL Bharat Sanchar Nigam Limited
Hutch Hutchinson Essar Limited
RIM Reliance India Mobile
GSM Global System for Mobile
CDMA Code Division Multiple Access
NTP National Telecom Policy
CPP Calling Party Pays
UAL Unified Access Licensing
ADC Access Deficit Charges
FDI Foreign Direct Investment
LISREL Linear Structural Relationships
GMPCS Global Communication by Satellite
OECD Organization for Economic Cooperation and Development
DEL Direct Exchange Lines
NCAER National Council of Applied Economic Research
3G Third Generation
DoT Department of Telecommunications
SMS Short Message Services
PSUs Public Sector Undertakings
CRM Customer Relationship Management
TQM Total Quality Management
JIT Just-in-time
MRP Material Resource Planning
GAM Global Account Management
ICT Information and Communications Technology
USO Universal Service Obligation
MoC Ministry of Communications
VSNL Videsh Sanchar Nigam Limtied
DTO Department of Telecom Operations
DTS Department of Telecom Services
NET X-25 based Packer Switched Data Network
GPSS Gateway Packet Switched Data Services
GEDIS Gateway Electronic Data Interchange Service
GEMS-400 Gateway E-Mail and Store & Forward FAX Service
CPS Concert Packet Service
VPT Village Public Telephones
CHAPTER – 1
INTRODUCTION
1.1 INTRODUCTION
1
interaction, devoid of the elements that would make up a relationship (Bendapudi
and Berry, 1997). Therefore, the concept of a relationship is highly subjective,
and given the lack of a clear definition of a relationship, it may be useful to
explore the various dimensions of a relationship and address their impact on the
overall quality of a relationship.
A service has been defined as, "any act or performance that one party
can offer to another that is essentially intangible, and does not result in the
ownership of anything..." (Kotler, 2004) Unlike physical products, service
products cannot be seen, tasted, felt, heard, or smelled before they are bought
(Parasuraman et al; 1985; Lovelock, 1981). Since services are intangible,
consumers are often faced with not knowing what to expect of a service until
they have consumed it, and hence perceive services as risky (Murray and
Schlacter, 1990). Further, research has demonstrated that the need for trust
arises in any situation characterized by a high degree of risk, uncertainty, and/or
a lack of knowledge or information on the part of the interaction participants
(Mayer et al., 1995). Thus, customers have an inherent need to trust in their
service provider to deliver the desired service outcome.
2
technology, in franchising from fewer regulations and professional restrictions, in
servicing physical goods and international markets (Lovelock, 1999).
The Reserve Bank of India (RBI) Annual Report for the year 2005-06
states that services have emerged as the fastest growing sector and has
imparted much of the effect to the overall growth of the economy, particularly in
the times of adverse agricultural shocks and industrial slow-down. Share of
services sector has risen from 41.3 percent in 1995-96 of services (including
construction) the real gross domestic product to 61.2 percent in 2005-06. A
major part of the share in service sector has taken place in trade,
communication, banking and insurance segments.
3
India, like many other countries of the world, has adopted a gradual
approach to telecom sector reform through selective privatisation and managed
competition in different segments of the telecom market. To begin with, India
introduced private competition in value-added services in 1992 followed by
opening up of cellular and basic services for local area to private competition.
Private competition was also introduced in National Long Distance (NLD) and
International Long Distance (ILD) telephony at the start of the current decade.
Gartner (2006), in its recently global forecast for mobile phones predicted
that mobile phones sales will exceed 1 billion in 2009. Asia/Pacific accounts for
most of the sales. China and India alone will account for nearly 200 million units
in 2007, with the Indian market surpassing China in 2009 to reach 139 million
units. The revenues of Indian cellular markets will reach $ 24 billion by year 2009
recording Compounded Annual Growth Rate (CAGR) of 35.6%. Mobile Value
Added Services (VAS) market in India is estimated at $0.55 billion (2005) and is
expected to grow more than fifteen fold to greater than $9 billion by 2010
(Lehman Brothers, 2006).
India has gone through a period of adjustment over the past 8 years. The
Telecom Regulatory Authority of India (TRAI) was constituted in 1997. It acts as
an independent regulator in this sector. Several progressive measures have
been taken over the past few years. At the time of launch of GSM cellular service
in the country, there were a number of impediments in the form of high handset
costs, exorbitant tariffs, high initial entry/activation charges, Mobile Party Pays
(MPP) regime etc. With the passage of time, these initial barriers have almost
disappeared as on date.
4
Figure 1.1: Major Developments in Indian Telecom Industry during 1986-2006
Guidelines for
opening up fixed-
Awarded 8 Enhanced and line operations
licences for Announced Transition to separated role of to unlimited
Established cellular services New Telecom revenue sharing TRAE regulatory competition; limited Privatization Lowering of Increase in
MTNL & VSNL in 4 metros Policy (NTP’99) arrangement & appellate Tribunal mobility permitted of VSNL access deficit FDI ceiling
Announced Awarded Separated DoT as: Long distance Fourth cellular Policy for Introduction of Introduction of
Telecom policy 33 cellular a) DTO - Service provider policy licenses awarded international CPP regime revenue share
for deregulation and 6 fixed line b) DoT - Policy maker announced. pursuant to a long distance regime
of sector licenses for Incorporated bidding process announced
individual circles BSNL, DTO
coprporation
process initiated
5
In the pre-reform period, growth in telecom services was primarily driven
by public sector monopoly, showing very marginal growth, as the incremental
tele-density between 1948 and 1998, a 50-year period, was only
1.92%.Telecommunication development in the initial stage of the reforms
process beginning with National Telecom Policy (NTP) in I994, which provided
for migration from fixed license fee to revenue share regime. Cost-Oriented
Telecom Tariffs were also introduced by TRAI in 1999. From 2003 onwards, as a
result of certain pragmatic decisions by the Government and the Regulator, viz.,
introduction of Calling Party Pays (CPP) regime, Unified Access licensing
regime, lowering of access deficit coupled with introduction of revenue share
regime triggered further growth. The incremental growth in the ratio of total
mobile subscribers as a proportion of the basic subscribers has been indicated in
table below:
Table 1.1: Mobile Subscribers (GSM and CDMA) as %of Basic Subscribers
in India – March, 2000 to March, 2006
It is very clear from table 1.1 that the number of mobile subscribers as a
proportion of basic service subscribers continued to increase, which reflects the
global trend. The ratio of mobile subscribers as a proportion of the basic
subscribers has shown tremendous growth of 179.28% for the year 2005-2006
as compare to 7.07% for 2000-01. Further, the performance of mobile service
providers can be studied on the basis of parameters of subscriber base,
teledensity and traffic.
6
From table1.2, following observations can be drawn:
iii) From 2000 to 2006, traffic or usage of mobiles phones increased, but the
increase was not uniform during the period. Till 2003, mobile usage went
up gradually but year 2004 onwards saw an era of speedy increase in
mobile traffic. It was probably because of the reasons that in initial days of
mobile telephony, call rates were high and the number of services offered
by cellular operators was limited. However 2003 onwards, because of the
slashed prices and add-on-services resulted in sudden increased traffic.
500
0
2000 2001 2002 2003 2004 2005 2006
Year
th
Source: www.trai.gov.in as on 15 Nov, 2006
Figure 1.2 exhibits trend of subscriber base, traffic and ARPU for the
period from 2000-2006. The revenue generated by a cellular company is the
resultant of two factors – number of subscribers and the usage rate (traffic).
Although traffic has been showing upward trend but the rate at which the
revenue has been increasing is far less than the rate of growth in subscriber
base and usage. The trend indicates that from 2000-2006, Average Revenue
7
Per User (ARPU) was consistently decreasing which means the revenue
generated through individual connection had been decreasing. This reflects the
decreasing profitability of incremental connections. The reason behind this
paradox is drastic reduction in rental and call rates over the last five years. In
order to woo the customers, companies slashed prices. Today, rental tariffs have
hit the lowest in the world at 40 paise for a local call and Rs.1.99 for an STD call.
Six years ago, mobile users had to pay Rs.16.40 for local calls and Rs.40 per
minute for an STD call. The pre-paid card, which was once sold for Rs.450-500
now costs just 10 paise now in most markets.
Service Providers are Categorised as per service into two parts --- Basic
Service Providers and Value Added Service Providers. Basic service providers
are those who provide mainly voice communication. The subscriber’s connection
to the telecom network is called a Direct Exchange Line (DEL) and people use it
for talking. Basic services can be differentiated as per call destination into
domestic and international. Domestic calls, both local and long-distance are
routed through cables and wireless links. International calls are routed overseas,
mainly through satellite links. The international telecom service providers of
various nations liaison with one another to ensure smooth operations and
efficient call transfer. Major global telecom service providers, mainly private
operators from the developed nations, determine international call tariffs.
Revenue sharing agreements exist between various international carriers. Value
added service providers are those which provide services, such as cellular
telephony, paging, e-mail and VSAT network, which provide the subscriber
greater ease of communication and enhance the utility of basic services network.
After the liberalization of Indian telecom sector in 1994, the Indian cellular
market witnessed a surge in cellular services. In cellular service there are two
main competing network technologies: Global System for Mobile
Communications (GSM) and Code Division Multiple Access (CDMA). With the
advent of cellular phones doing double and triple duty as streaming video
devices, pod cast receivers and email devices, speed is important to those who
use the phone for more than making calls. CDMA has been traditionally faster
than GSM, though both technologies continue to rapidly leapfrog along this path.
In GSM phones, SIM cards are used. The removable SIM card allows phones to
8
be instantly activated, interchanged, swapped out and upgraded, all without
carrier intervention. The SIM itself is tied to the network, rather than the actual
phone and the phones that are card-enabled can be used with any GSM carrier.
CDMA operators require proprietary handsets that are linked to one operator
only and are not card-enabled. To upgrade a CDMA phone, the operator must
deactivate the old phone then activate the new one and the old phone becomes
useless.
By 2004, there were a total of 12 players in the market with the five major
players being Bharti-Tele-ventures Limited (Bharti), Bharat Sanchar Nigam
Limited (BSNL), Hutchinson-Essar Limited (Hutch), Idea, Cellular Limited (Idea),
and Reliance India Mobile (RIM). All the players except RIM offered services
based on the Global System for Mobile (GSM) technology whereas RIM
provided services based on code division Multiple Access (CDMA) technology.
At the end of March, 2006, following operators were providing mobile service
(GSM & CDMA) in the service areas mentioned in Table 1.3 below:
Table 1.3: List of Cellular (GSM & CDMA) Service Providers in Operation as
on 31st March, 2006
9
Figure 1.3: Growth for GSM vs. CDMA Subscribers for the Period
of 1999-2006
Figure 1.3 signifies the comparison of the growth trend for GSM and
CDMA subscribers for the period of 1999-2006. On cumulative basis, India has
grown by 73.5% taking the overall tally to 90.8 million subscribers in year 2006
as compare to 1.2 million subscribers in March, 1999. Of this, GSM contributes
76% whereas CDMA contributes 24%. The industry has added 38.5 million
mobile lines i.e. around 3.2 million lines every month and around 90,000
connections every month. As every month, 4-5 million lines are being added,
growth continues even in the year 2006.
10
Figure 1.4 explains Operator-Wise Market Share of GSM mobile services.
The GSM subscribers’ base has reached 91.01 million in the quarter ending
September 2006 as against 78.49 million at the end of the previous quarter
registering a growth rate of 15.94%.Bharti with 27.06-million subscriber base
remains the largest GSM mobile operator holding 29.73% share. It is followed by
BSNL, Hutch and Idea with subscriber base of 20.93 million, 20.36 million and
10.36 million, respectively. The subscriber base of all the GSM operators has
increased except that of BPL which is operating in Mumbai. Private operators
have 74% subscribers whereas Public sector Operators (BSNL & MTNL) have
26% subscribers in the GSM segment.
The figure 1.5 explains the market share of CDMA operator on Sep, 2006.
Reliance Communications Ltd continued to have the highest subscriber base
with 60% market share followed by Tata Teleservices with 32% market share,
while other players in CDMA Technology have the remaining 8%.
11
marketing tools to establish and build profitable customer relationship.
With the concept of relationship marketing, we focus on the need for
companies to be market oriented by building up the ability to manage
networks, relationships and interactions (Gronroos, 1983; Gummesson,
1987). In other words, the main thrust has been on expanding the
relationship with existing customers. It has been fully accepted in
marketing literature that long-term customers are more profitable than
short-term customers (Reichheld and Teal, 1996; Johnson, 1998).
The marketing literature has shown that trust between firms, and
between firms and consumers, is a crucial factor in the move from discrete
market transactions to continuous exchange relationships. Most firms
have reacted to this dynamics by trying to develop long-term cooperative
relationships with other firms (Valdani 1997; Lanza 1998) and, above all,
with the clients, final and intermediate (Busacca 1994; Castaldo 1994;
Costabile 1999). Such relationships are based on mutual trust, and are
intended to control the variety and the variability (Vicari 1991; Rullani,
1992; Busacca, 1997). Trust established between firms, and between
firms and consumers, is one of the fundamental resources that firms can
make use of in order to control complexity. The continuous growth of trust
makes it possible, according to several authors, to pursue the objective of
the firm’s value generation and diffusion (Guatri, 1991; Vicari, 1991; Guatri
and Massari, 1992; Busacca, 1994; Costabile 1996b and 1998; Vicari,
Busacca and Bertoli, 1999).
12
As a first approach, trust whether in someone or something, can be
defined as an attitude, characterised by the belief in the counterparty’s
reliability, for example, supplier or client. More specifically, according to
some authors, this is the belief (Castaldo, 1995) that the behaviour of the
counter party is predictable in terms of its direction and intensity, which
means that future actions of the counterparty will conform to obligations
assumed, implicity or explicity. In general, this perception of reliability
comes from experience, and more particularly, from a sequence of
satisfactory interactions, that is a series of evaluative processes from
which a systematic confirmation of expectations emerges (Costabile,
1996).
Some recent studies have also considered the trust concept in the
area of consumer marketing, that is in the relationships between firms and
13
final consumers. This is particularly the subject matter of studies aimed to
analyze the constructs involved in the customer buying behavior, such as
satisfaction, brand image and customer loyalty (Valdani and Busacca,
1992; Busacca, 1994; Vicari, 1995; Berry, 1995; Gruen, 1995; Gurviez,
1995; Busacca and Castaldo, 1996; Fletcher and Peters, 1997; Costabile,
1999).
14
In the opinion of some authors, trust would depend on the
perception that there is not opportunism from the counterparty, which
would be, in its turn, reinforced by the certainty that a behaviour is intented
to achieve a joint objective (goal congruence). This is the view, even if
there are some other changes, of Andaleeb (1992) who, referring to
channel relationships, has affirmed that trust is influenced by the party’s
perception about the motivations governing the other party’s actions. The
stronger the belief that these motivations are debatable, or even
opportunist, the more difficult it is to trust. The same author says that the
formation of trust can be adequately explained only by taking into account
another dimension: exchange partner ability, or rather the perception of
that competence.
ABILITY
High Low
Positive
Negative
Source: Andaleeb (1992),”The trust concept: research issues for channel distribution”, Research
in Marketing, vol. 11, pp.1-34
15
This matrix, subsequently considered also by Busacca and Castaldo
(1996), allows both to conceptualize the multidimensional nature of trust
and to hypothesize different configurations of it. Indeed, it would not exist
only one type of trust, but different types, which can be identified by
combining the perceptions about motivations and ability of the
counterparty – typically the supplier.
a) credibility, which depends on the buyer’s belief that the supplier has
the required expertise to carry out his role effectively and reliability;
In the same point of view, finally, Castaldo (1995) and Busacca and
Castaldo (1996) propose a conceptualization tri-dimensional of the
construct, taking account both the dimension originally identified in the
studies of social psychology, that is the predictability of the behaviour, and
the dimensions identified by Andaleeb (1992): the perceptions about ability
and the perceptions about motivations of the firm.
16
Morgan and Hunt (1994) do not agree with last definition. Indeed,
even though they identify two different dimensions of the construct, yet
they hold that trust also exists in the presence of the cognitive component
alone. That is, it would be enough that the buying firm believes in the
honesty and reliability of the supplier firm. The behavioural intention
incorporated in the honesty and reliability of the supplier firm. The
behavioural intention incorporated in the willingness (“willingness to act”)
identified by Moorman, Zaltman and Deshpande (1992) would be implicit
in the concept of trust itself. Morgan and Hunt (1994), on this point, argue
that, although it might be appropriate to have items that incorporate
“declared willingness” into a measure of trust, willingness is redundant to
its definition: willingness to rely should be seen as a result (or,
alternatively, as a potential indicator) of trust, and not as one of its
constitutive dimensions.
17
concept of commitment is used to analyse both individual and
organizational behaviour (Becker, 1960). Sociologists use commitment as
a descriptive concept to mark out forms of action characteristic of
particular kinds of people or their groups. They also use it as an
independent variable to account for certain kinds of behaviour of
individuals and groups, as well as in analyses of a wide variety of
phenomena:
• Power;
• Religion;
• Occupational Recruitment;
• Bureaucratic Behaviour; and
• Political Behavior (Becker, 1960).
18
1.4 RATIONALE OF TRUST AND COMMITMENT
It has been estimated that the cost of attracting new customers can
be as high as six times that of retaining existing customers
(Desatnick, 1987; Sellers, 1989; Congram, 1991).
19
5. Good relationships with customers can result in good work-of-mouth
from successful exchanges and minimal bad work-of-mouth in the
event of unsuccessful exchanges.
20
over the electronic network, there are risks that unauthorized parties could
intercept this information (Clay and Strauss, 2000).
1. Shared Value;
2. Communication;
3. Opportunistic behaviour.
21
customers and selling customer information to other parties. Ethics and honesty
in a broad sense, which are aspects of good business morality, build trust
(Huemer, 1998). Mechanisms such as code of ethics and institutional
governance that establish and enforce rules and regulations can build trust by
addressing security and privacy concerns (Benassi, 1999).
Security is another factor that affects customer trust. This reduces the
customers’ level of trust, discouraging them from engaging in information
sharing. However, one study has shown that recent developments in electronic
exchange systems have caused an average customer to be less concerned
about the security of electronic exchanges or privacy issues (Swaminathan et al.,
1999). Security was identified as one of the least important factors to distinguish
a compelling online environment (Novak et al., 2000).
1.6.2 Communication
22
Communication, especially timely communication (Moorman et al., 1993), fosters
trust by assisting in resolving disputes and ambiguities, and aligning perceptions
and expectations (Etgar, 1979). Anderson and Narus (1990) and Morgan and
Hunt (1994) have used past communication as an antecedent of trust.
Opportunistic behaviour has its roots in the transaction cost literature, and
is defined as (Williamson, 1975). In this research, opportunistic behaviour has
been conceptualized as regulatory control and information asymmetry.
23
frequently have low levels of trust (Clay and Strauss, 2000). Identities can be
forged (Ba, 2001) and electronic documents can be falsified (Bailey and Bakos,
1997). The lack of adequate regulatory control also leads to the customers’
perception that their personal information may be used without their knowledge
during or after navigation (Novak et al., 1999; Li et al., 2001; Ackerman et al.,
1999). Therefore, the customers’ level of trust would be partly based on whether
they believe that the service provider would fulfill its obligations. Klang (2001)
pointed out that customers tend to assess the company’s interests and then
make a judgement about its integrity.
24
association, length of association and sense of belonging. Thus, this research
hypothesize that as trust increases, commitment also increases.
The overall research issues and the model tested are given in Figure 1.6.
25
Figure 1.6: Trust and Commitment Model of the Research Study
Privacy Sense of
Degree & length
Belongingness
of association
Security
Ethics
Shared Value
H2 H5
Openness
H3 Relation
Communication Trust
Speed H1 Commitment
Quality of H4
Information
Opportunistic
Information
Behaviour
Asymmetry
26
This research formulates following hypotheses:
27
H6b: Shared value has positive significant influence on customer trust
and commitment.
H6c: Communication has positive significant influence on customer trust
and commitment.
H6d: Opportunistic behaviour has a negative significant influence on
customer trust and commitment.
H6e: Trust has positive significant influence on customer trust and
commitment.
H7: Level of customer trust and commitment among various telecom service
providers.
H8: There is no significant relationship between trust & commitment and
demographic variables.
H9: Trust and commitment have significant impact on both pre-paid and post-
paid subscribers.
It is well perceived fact that customer trust and commitment have become
the important factors of business success. However many conclusions have
been drawn with regard to trust and commitment. But there are very few studies
related with trust and commitment in telecom sector with special reference to
India. The relevance of Trust and Commitment Theory for mobile users of Indian
Telecom Sector has yet to be established.
• Impact of technology
29
1.9 RESEARCH METHODOLOGY
While selecting services for the study, a number of factors are taken into
account. Both pre-paid and post-paid services are selected for this purpose. The
preliminary study showed that the ratio between prepaid and postpaid subscriber
base is 80: 20. Since, Average Revenue per User is 4 times more in case of
postpaid users as compared to the prepaid subscribers. So, more weightage is
paid to the post-paid subscribers. Besides, the operators adopt various retention
tools in the post-paid category to retain customers.
1.9.4 Questionnaires
30
Sample is selected in two phases:
Reliance Prepaid 5 5 5 5
Infocom Postpaid 20 20 20 20
Prepaid 5 5 5 5
Airtel
Postpaid 20 20 20 20
Prepaid 5 5 5 5
Tata Telecom
Postpaid 20 20 20 20
Prepaid 5 5 5 5
Hutch
Postpaid 20 20 20 20
This study will be based on primary and secondary data. The main
sources of secondary data will be published reports of World
Telecommunications development, Department of Telecommunications, Indian
Telecom Policy, Year book of Statistics, Journals, Books and various websites of
the Mobile operators. The primary data will be collected through the
questionnaire and personal Interviews. 4 Major telecom operators are selected:
Reliance Infocomm, Airtel, Tata Telecom and Hutch. Through a systematic
random sampling, a sample 400 respondents will be selected for administering
questionnaire at the touch-points of these Telecom Operators in these select
31
towns. Besides this, a sample of 60 questionnaires would be collected from
employees and 40 from the dealers of selected operators.
The data collected will be analysed using various statistical tools. The
basic framework of the model consisted of unobservable theoretical constructs,
which would not be measured directly. So, this study used a set of indicator
variables, which measured the unobservable constructs.
Tests for significance are less useful in small samples (less than 30) and
quite sensitive in large samples (exceeding 1,000 observations)(Hair et al.,
1995). Thus, both graphical and statistical tests will be carried out using SPSS
version 10.0 for Windows to assess the actual degree of departure from
normality the mean, standard deviation and reliability estimate of each model
construct are furnished in Table 1.8.
32
Table 1.8: Summary Statistics and Reliability Estimates
for the Model Constructs
There are four telecom service providers and data pertaining to 4 cities.
The linear model used for ith (i=1,2,3,4) telecom service operators and jth
(j=1,2,3,4) cities.
The linear model used for ANOVA with two way classification without
interaction is
33
Here
In equation (3.2), the total sum of squares (TSS) can be decomposed into
three components i.e. sum of squares due to telecom service providers, sum of
squares due to place (SSP) and sum of squares due to error (SSE). Therefore, it
can be written.
TSS=SSTSP+SSP+SSE
34
Thus for testing H01 i.e. there is no variation between telecom service
provider, reject H01, if
And
For testing there is no variation between cities, reject H02, if yi0 and yi’0 be
the means for these telecom service providers, then we reject H0 if
The ANOVA is tested for trust and commitment and its variables for
different combinations:
(a) Selected telecom service provider and prepaid and postpaid subscribers
and the interaction between both of them.
(b) Selected city and prepaid and postpaid subscribers and the interaction
between both of them.
(c) Selected telecom service provider and selected city and the interaction
between both of them.
(d) Prepaid and postpaid subscriber, selected telecom service provider and
selected city and the interaction between both of them.
(X1 − X 2 ) − (µ1 − µ 2 ) 0
t= (3.3)
S2P (1/n1 + 1/n 2 )
Where S2P is the pooled variance of the two samples, which serves as the
estimate of the common population variance given by the formula
35
The degrees of freedom for t are (n1+n2-2).
(X1 − X 2 ) - (µ1 − µ 2 ) 0
t= (3.5)
S12 /n1 + S22 /n 2
We estimate σ2 by-
(X1 − X 2 ) − (µ1 − µ 2 ) 0
(3.8)
Sp 1/n1 + 1/n 2
(X1 − X 2 ) − (µ1 − µ 2 ) 0
(3.9)
S12 /n1 + S 22 /n 2
Another test of hypothesis used is the chi square test. Chi square is
one of the most important and widely used non-parametric test in
36
statistics. Many authors (Siegel and Castellan, 1988; Gupta, 1998; Singh,
1998) have discussed and explained chi square in detail.
Σ(O − E) 2
χ2 = (3.10)
E
O = observed frequencies
E = expected frequencies
RT x CT
E=
N
E = Expected frequency
While comparing the calculated value of χ2 with the table value the
degrees of freedom are to be determined. Degrees of freedom means the
number of classes to which the values can be assigned arbitrarily or at will
without violating the restrictions or limitations placed. The degrees of
freedom are denoted by the symbol v or d.f. and are obtained by v=n – k,
where k refers to the number of independent constraints. In a contingency
table, the degrees of freedom are obtained by (c-1) (r-1) where ‘c’ refers to
column and ‘r’ refers to rows.
Singh (1998) explains that some times it happens that with 1df, any
one of the expected cell frequencies becomes less than 5. In such a
situation a correction called Yates correction for continuity is applied.
Where frequencies are large, this correction makes no difference but
where frequencies are small, Yates correction is significant. According to
37
Siegel and Castellan (1998) applying the χ2 test to data where both r and c
equal 2, the following equation should be used.
N (| AD - BC | -N/2) 2
χ2 = df=1 (3.11)
(A + B) (C + D) (A + C) (B + D)
Chapter 1: Introduction
This chapter covers the fastest growing services and brief overview of
growth of Indian telecom sector. Research objectives and significance of study
are also covered. This chapter is concerned trust and commitment, research
methodology used for selection of telecom service providers, geographical
scope, selection of variables and analysis of the tools required tools for the
study.
38
Chapter 5: Research Findings of the Study
Bibliography
Appendices
• Tables
• Questionnaire
• List of Abbreviations
39
REFERENCES
• Akhil Gupta, “Telecom – Is the Future Finally Near?”, 2001 Asian venture
forum, India, Dec. 2001.
• Beatty, S.E. and Kahle, L.R. (1988), “Alternative hierarchies of the attitude
– behaviour relationship: the impact of brand commitment and habit”,
Journal of the Academy of Marketing Science, Vol.16, No.2, pp.1-10.
40
• Berry, L.L. (1995), “Relationship marketing of services: growing interests,
emerging perspectives”, Journal of the Academy of Marketing Science,
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• David, L. Kurtz (2002) Kenneth and Clow Services Marketing, John Willy
& Sons.
• Doney, P.A. and Cannon, J.P. (1997), “An examination of the nature of
trust in buyer seller relationships”, Journal of Marketing, Vol.61, April,
pp.35-51.
41
• Gummerson, E. (1987), “The new marketing developing long-term
interactive relationships”, Long-range Planning, Vol.20, No.4, pp.10-20.
• Gundlach, G.T., Achrol, R.S. and Mentzer, J.T. (1995), “The structure of
commitment in exchange”, Journal of Marketing, Vol.59, No.1, pp.78-93.
• Gwinner, K.P., Gremler, D.D. and Bitner, M.J. (1998), “Relational benefits
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Science, Vol.26, No.2, pp.101-14.
42
• Kotler, P. (1997), Marketing Management: Analysis, Planning,
Implementation and Control, 9th ed., Prentice Hall, Englewood Cliff, N.J.
• Mayer, R.C. Davis, J.H. and Schoorman, F.D. (1995), “An integrative
model of organizational trust”, Academy of Management Review, Vol.20,
March, pp.709-34.
• Murray, K.B. and Schlacter, J.L. (1990), “The impact of services versus
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43
• Pritchard, M.P., Havitz, M.E. and Howard, D.R. (1999), “Analyzing the
commitment-loyalty link in service contexts”, Academy of Marketing
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• Rakesh Seth and Kirti Seth (2005), Creating Customer Delight: The How
and Why of CRM, Response Books.
• Ratter, J.B. (1967), J.B. (1967), “A new scale for the measurement of
interpersonal trust”, Journal of Personality, Vol.35, No.4, pp.651-65.
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behind growth, Profits and Lasting Value, Harvard Business School
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44
• Sheaves, D.E. and Barnes, J.G. (1996), “The fundamentals of
relationships: an exploration of the concept to guide marketing
implementation”, in Swartz T.A., Bowen, D.E. and Brown, S. (Eds.),
Advances in Services Marketing and Management, Jai Press Inc.,
Greenwich, C.T., Vol.5, pp.215-45.
45
CHAPTER – 2
REVIEW OF LITERATURE
The growth in demand for telecom services in India is not limited to basic
telephone services. India has witnessed rapid growth in cellular, radio paging,
value added services, internet and global communication by satellite (GMPCS)
services. The agents of change, as observed from international perspective,
have been broadly categorized into economic structure, competition policy and
technology. Economic reforms and liberalisation have driven telecom sector
through several transmission channels of which these three categories are of
major significance.
46
The problems with these communications forms include reliability, speed of
transmission, and comprehension purposes.
Muller (1990) in his a research focuses that the success of the mobile
commerce can be attributed to the personal nature of wireless devices. Adding
to this are its unique features of voice and data transmission and distinct
features like localisation, feasibility and convenience. The sustained growth of
the mobile commerce around the world has been more because of the transfer
of technology according to the needs of local geography.
47
World Telecommunication Development Report (2002) explains that
network expression in India was accompanied by an increase in productivity of
telecom staff measured in terms of ratio of number of main lines in operation to
total number of staff.
Adam Braff, Passmore and Simpson (2003) focus that telecom service
providers even in United States face a sea of troubles. The outlook for US
wireless carriers is challenging. They can no longer grow by acquiring new
customers, in fact, their new customers are likely to be migrated from other
carriers. Indeed, churning will account for as much as 80% of new customers in
2005. At the same time, the carrier’s Average Revenue Per User (ARPU) is
falling because customers have.
48
wireline voice tariffs in organisation for Economic Co-operation and Development
Countries have fallen by an average of three percent per year between 1999 and
2003.
Rajan Bharti Mittal (2005) explains the paradigm shift in the way people
communicate. There are over 1.5 billion mobile phone users in the world today,
more than three times the number of PCOs. India today has the sixth largest
telecom network in the world up from 14th in 1995 , and second largest among
the emerging economies. It is also the world’s 12th biggest market with a large
pie of $ 6.4 billion. The telecom revolution is propelling the growth of India as an
economic powerhouse while bridging the developed and the developing
economics.
ASEAN India Synergy Sectors (2005) point out that high quality of
telecommunication infrastructure is the pillar of growth for information technology
(IT) and IT enabled services. Keeping this in view, the focus of telecom policy is
vision of world class telecommunication services at reasonable rates. Provision
of telecom services in rural areas would be another thrust area to attain the goal
of accelerated economic development and social change. Convergence of
services is a major new emerging area.
49
cellular summit, 2005, the Union Minister for Communications and Information
Technology, Dayanidhi Maran had proudly stated that Indian telecom had
reached the landmark of 100 million telecom subscribers of which 50% were
mobile phone users. Whereas in African countries like Togo and Cape Verde
have a coverage of 90% while India manages a merely mobile coverage of 20%.
Marine and Blanchard (2005) identifies the reasons for the unexpected
boom in mobile networks. According to them, cellphones, based on Global
System for Mobile Communication (GSM) standard require less investment as
compared to fixed lines. Besides this, a wireless infrastructure has more mobility,
sharing of usage, rapid profitability. Besides this, usage of prepaid cards is the
extent of 90% simplifies management of customer base. Moreover, it is suitable
to people’s way of life-rural, urban, and sub-urban subscribers.
50
According to Business and Economy (2005) the catalyst for Indian
mobile operators in the future will undoubtedly be increased marketing and
advertisement expenditure, along with better deals for mobile phone users like
the previously mentioned full talk time Rs. 10 recharge card, will go a long way in
not only retaining customers but also acquiring the vast market of lowered
customers who are extremely sticky about value for money and have extremely
low loyalties and almost non-existent switching costs.
51
It offers a great opportunity for equipment vendors to make India a
manufacturing hub. Indian infrastructure capital expenditure on cellular
equipment will be between 10 to 20% of the investment that will be made by
international operators by 2015. The other proposals included setting up of
hardware manufacturing cluster parks, conforming to global standards and fiscal
incentives for telecom manufacturing among others.
Virat Bahri (2006) explains the viewpoint of Sam Pitroda the Chairman of
Worldtel that identifies opportunities for investments in telecommunications. He
analyses that there is an increasing role for telecom in e-governance in India.
According to him, technology can be leveraged to take India’s development to
next level.
Business Today (1992) pointed out that due to lack of technical and
financial resources especially foreign exchange, the DOT generally lagged
behind in its level of technology. India’s indigenisation program in the switching
segment carried out by C-DOT was successful in the introduction of rural
exchanges designed specially for Indian conditions characterized by dust, heat
and humidity.
52
acceleration of the innovation process, which is constantly bringing forward new
products and services. Besides expanding the market potential, this innovation
process has also given rise to major changes in industry and the institutional
structure.
P.S. Saran (2004) the telecom technology in India has transformed from
manual and electro-mechanical systems to the digital systems. India has
stepped into new millennium by having 100% electronic switching system. The
technological changes have made way for new services and economics in the
provision of telecom services.
53
According to Mather (2005) the challenge, of course, is that a competitor
can show up in one of your established markets with new technology, better
people, a better network of companies for support and a better management
style and steal huge chunks of your business before you can respond. Staying at
the forefront of all these issues will be the only way to stay successful.
Melody (1990) points out that the Indian Government had not addressed
the basic requirement necessary for reform and there was no pre-planned
sequence of structural changes which are basic determinants of reform.
Therefore, the government, investors and subscribes could expect only marginal
benefits from the reform process.
Jain and Chhokar (1993) points out the limitations of capital and
manpower as key constraints. The Athreya’s Committee’s report may be viewed
as an initiation of a process of examining organizational options. Management
incentives which would allow these organizations to increase profitability and the
structural mechanisms which would allow then to raise capital from markets had
been sketchily outlined.
54
2.2.3 Studies Relating to Competition in Indian Telecom Service Sector
Melody (1990) points out various concerns for the telecom sector
covering competition as important one. Competition is considered more
important factor than ownership in introducing efficiency. Further the order in
which structural adjustments take place determine the effectiveness. Donaldson
(1994), Jussawala (1992); Jain, (1995); Wellenius (1995), recognize that
developing countries feel the important role a responsive, business oriented, and
technologically advanced telecom sector plays in the growth of the economy.
Many developing countries accept the limitations of a monolith state monopoly in
responding to the twin challenges of spurring internal growth and competing in
global economy.
N.M. Shanthi (2005) throws light on the factors that contributed to the
growth of telecom sectors. The studies various initiatives takes by government in
lien of liberalisation, privatisation and de-monopolisation initiatives. The trend is
expected to continue in the segment as prices are falling as a result of
competition in the segments. The beneficiaries of the competition are the
consumers who are given a wide variety of services.
55
Arindham Mukherjee (March, 2006) takes out various case studies like
Vodafone, Maxis, Telekopm Malaysia, Tatatele etc. to study the rising interest of
foreigners for investment in Indian telecom industry. Various reasons of
stemming growth can be rising subscriber base, rising teledensity, rising handset
requirements, saturated telecom markets of other countries, stiff competition,
requirement of huge capital, high growth curve on telecom, changing regulatory
environment, conducive FDI limits in telecom sector.
As Navin (1995) points out, these terms have been used to reflect a
variety of themes and perspectives. Some of these themes offer a narrow
functional marketing perspective while others offer a perspective that is broad
and somewhat paradigmatic in approach and orientation. A narrow perspective
of customer relationship management is database marketing emphasizing the
promotional aspects of marketing linked to database efforts (Bickert, 1992).
56
database knowledge with a long-term customer retention and growth strategy
(Peppers and Rogers, 1993). Thus, Shani and Chalasani (1992) define
relationship marketing as “an integrated effort to identify, maintain, and build up
a network with individual consumers and to continuously strengthen the network
for the mutual benefit of both sides, through interactive, individualized and value-
added contacts over a long period of time”. Jackson (1985) applies the
individual account concept in industrial markets to suggest CRM to mean,
“Marketing oriented toward strong lasting relationships with individual accounts”.
57
made between transactional exchanges and relational exchanges by Dwyer,
Schurr, and Oh (1987), to suggest that relationship marketing “refers to all
marketing activities directed toward establishing, developing, and maintaining
successful relationships.”
The core theme of all CRM and relationship marketing perspectives is its
focus on cooperative and collaborative relationship between the firm and its
customers, and/or other marketing actors. Dwyer, Schurr, and Oh (1987) have
characterized such cooperative relationships as being interdependent and long-
term oriented rather than being concerned with short-term discrete transactions.
The long-term orientation is often emphasized because it is believed that
marketing actors will not engage in opportunistic behaviour if they have a long-
term orientation and that such relationships will be anchored on mutual gains
and cooperation (Ganesan, 1994).
58
marketing. The production and consumption functions got separated leading to
marketing functions being performed by the middlemen. And middlemen are in
general oriented towards economic aspects of buying since the largest cost is
often the cost of goods sold.
According to (Shapiro and Posner, 1979) with the advent of the digital
technology and complex products, systems selling approach became common.
This approach emphasized the integration of parts, supplies, and the sale of
services along with the individual capital equipment. Customers liked the idea of
systems integration and sellers were able to sell augmented products and
services to goods, as well as services. At the same time some companies
started to insist upon new purchasing approaches such as national contracts and
master purchasing agreements, forcing major vendors to develop key account
management programs
59
Similarly, in the current era of hyper-competition, marketers are forced to
be more concerned with customer retention and loyalty (Dick and Basu, 1994);
Reicheld, 1996). As several studies have indicated, retaining customers is less
expensive and perhaps a more sustainable competitive advantage than
acquiring new ones. Marketers are realizing that it costs less to retain customers
than to compete for new ones (Rosenberg and Czepiel, 1984).
On the supply side it pays more to develop closer relationships with a few
suppliers than to develop more vendors (Hayes et al., 1998; Spekman, 1988).
In addition, several marketers are also concerned with keeping customers for
life, rather than making a ne0time sale (Cannie and Caplin, 1991). There is
greater opportunity for cross-selling and up-selling to a customer who is loyal
and committed to the firm and its offerings . Also, customer expectations have
rapidly changed over the last two decades. Fueled by new technology and
growing availability of advanced product features and services, customer
expectations are changing almost on a daily basis. Consumers are less willing to
make compromises or trade-off in product and service quality. In the world of
ever changing customer expectations, cooperative and collaborative relationship
with customers seem to be the most prudent way to keep track of their changing
expectations and appropriately influencing it (Sheth and Sisodia, 1995).
60
According to David L. Kurtz (2003) the purpose of relationship marketing
is to build long-term connections between the company and its customers and to
develop brand and firm loyalty. Relationship marketing works well for services
where transactions tend to be continuous and switching costs for customers are
high. Firms operating in the customization and functional service quality sector
do well with relationship marketing programs. The long-term goal of relationship
marketing is to build brand loyalty. Personal interaction with service personnel is
critical in the development of the long-term relationship.
2.3.1 Trust
61
Analyzing data, Bercerra and Gupta (1999) categorized both negative
consequences of lack of trust and key positive results from high trust
relationships. For instance, a manager’s time and time spent on dealing with low-
trust relationships are higher than those spent in dealing with high trust would
enjoy open communication and willingness to take risks. People in high trust
relationships are not afraid to share all information received. They also indicated
that the overall performance would be enhanced the problems of distrust were
reduced .
According to Dr. Hal Varian (2001) in part, one got to have incentives set
up in a way that there is something for everybody in the transaction. A lot of the
trust comes out of the repeated nature of the interactions, or the contractual
interaction, or the system you set up for compensation, or revenue sharing.
Those are the behind-the-scenes components that really cause the trust to be
created and work successfully.
62
importance of trustworthiness and the qualities it takes to create it throughout the
Collaborative Community underlies trust building.
63
spend millions of dollars for acquiring or customer but after they behave miserly
when managing those critical touch points. For example, while customer
interactions at the point of sale is usually initiated by company, complaints and
queries are initiated by the customers. It is important to understand that
customer oriented interfaces are more personal in nature and have more impact
on customer satisfaction than company initiated interfaces. Hence, the voice-
integrated services, internet enabled services and customer query response
services should be treated with greater importance.
64
Moorman, Zaltman and Deshpande (1992), in a study of relationships
between providers and users of market research identify a cognitive and
behavioural dimensions of trust. The cognitive dimension would consist of the
belief in the partner’s reliability (trustworthiness), or credibility which comes from
motivation and knowledge. The behavioural intention, that is the concrete act of
placing trust in the partner and this implies vulnerability in the trustor, the person
doing the trust.
Morgan and Hunt (1994) identify the two different dimensions of the
commitment, they hold that trust also exists in the presence of cognitive
component alone. That is, it would be enough that the buying firm believes in the
honesty and reliability of the supplier firm. The behavioural intention incorporated
in the ‘willingness to act’ would be implicit in the concept of trust itself.
Willingness to rely should be seen as a result rather than one of its constitutive
dimensions.
65
that one service could address a variety of mobile devices. Standardized
application services are just beginning to emerge in mobile telecommunications,
but their value could grow rapidly. Application server software – a similar layer of
reusable IT functions deployed in a multitude of enterprise applications (for
instance, customer-relationship-management systems) – created a $2 billion
market in only a few years.
Singh and Gupta (2004) explain the application of data mining tools on
telecommunication industry. The telecom industry is offering local and long-
distance telephone services to provide many comprehensive communication
services including data and voice. Data mining tools are used for identifying
behaviour patterns of behaviours of different groups of users, the traffic data,
usage of services etc. For the purpose data from applications such as billing,
marketing, sales, fraud management, performance analysis systems, network
switches and customer service across the company.
66
customer acquisition, corporate have been aggressively pursuing different
customer retention strategies and tools for retaining customers, companies in
India are realizing the fact that retaining an old customer is easier than acquiring
a new one. Hence, most companies have started in feel the need to reward
those customers who have been loyal to them.
67
pressed to search for new clients if it already has a good base of existing clients.
This will help it not only save the precious time but also investment. In fact, you
could expect much more than that. The author’s own experience suggests that
sometimes you may discover that these very clients are more discerning ones,
and are less price-conscious. They may want a fair price, but more importantly,
they want quality-service. And sometimes, to your pleasant surprise they may
want a lifetime relationship also. The author discovered that as he improved his
own organization’s service to his clients not only did the number of prospective
clients calling him increase but the order size was also big. This made selling a
lot easier.
68
whether or not they eventually become monthly subscribers. It was found that
when a carrier implements an effective acquisition program, it could increase the
profitability of prepaid customers by 40 to 80 percent. To turn the prepaid
segment around, companies must choose their customers more carefully
manage the life cycle and clean.
Authors Seybold and Marshak (2005) in their book titled “The Customer
Revolution” explain a customer scenario net is a customer and project-specific
set of interrelated tasks that can be managed via the internet to accomplish a
specific outcome. It’s a particularly dynamic form of e-market. The players
involved and the services offered will depend on the customer’s context. To keep
on track, today’s business must effectively turn information about its customers
into intelligence that can guide the company’s actions. No longer can this be
offline market research conducted leisurely in some back room. The pace of
business now requires that near-real time information be analyzed and
responded to quickly.
69
and services to profitably satisfy the customers’ needs. While working in the
collaborative community, the ability to develop a relationship and understand the
needs of the customer is the key and customer in such cases refer to every party
which must receive some value from the collaboration. By developing the
business through an iterative process, companies can know more precisely how
to get and retain customers, develop the products and services that satisfy the
customers’ needs and finally deliver and serve the customers.
70
according to their requirements are few examples of the companies giving
importance to the customer and developing a customer-centric culture.
71
the concept of commitment from Morgan and Hunt (1994) who defined
commitment as “an exchange partner believing that an ongoing relationship with
another is so important as to warrant maximum efforts at maintaining it, that is,
the committed party believes the relationship endures indefinitely” and
commitment is central to all of the relational exchanges between the firm and its
various partners.
Opportunistic behaviour has its roots in the transaction cost literature, and
is (Williamson 1975) defined as “self interest seeking with guide”. This research
posits that the strong negative relationship exists between organizational
commitment and propensity to leave the organization. As per Mathew and Zajac
(1990) the negative relationship also exists between commitment and propensity
to leave the telecom organization relationship.
As to the switching costs are actually very low in the cellular services, the
Switching costs to an ongoing relationship being viewed as important and
72
generating commitment to the relationship. Therefore, relationship commitment
results when customers perceive the costs of terminating the relationship are
high. An assumption in literature is that a terminated party will seek an
alternative relationship and have “switching costs”, which lead to dependence
(Jackson 1985; Heide and John, 1988) described that switching costs are
exacerbated by idiosyncratic investments, that is, investments are difficult to
switch to another relationship. Also Dwyer et al (1987) proposed that the buyer’s
anticipation of higher switching costs give rise to the buyer’s interest in
maintaining a quality.
According to (Keveaney, 1995; Porter, 1985) the varying effects are the
result of the nature of risk that accompanies the establishment of a "relationship"
with a particular service provider. Initial service encounters carry a certain
degree of risk due to the intangible nature of the service product and, the
customer not knowing what to expect in terms of the service outcome.
Uncertainty (and hence risk) is reduced as knowledge is gained with repeat
exposure to the service supplier over time. However, at the same time risk is
reduced due to increased familiarity, risk is also increased because of the
switching costs incurred as a result of long-term service relationships.
73
2.3.6 Communication
Following gaps are identified from the survey of literature that will help to
research problem.
74
Table 2.1: Drivers of the New Telephony
75
CHAPTER – 3
3.1 INTRODUCTION
With the awareness spreading around the world on the Information and
Communications Technology (ICT), in the later part of the 20th century,
countries, especially the developing ones, began to realize the importance of
an efficient telecommunication network for the development of the economy.
At the dawn of the 21st century, the developing countries started to make
full use of the technology revolution taking place around the world, with many
countries liberalizing the existing stringent policies and regulations. To improve
information and telecommunication technology, 189 countries of the UN met at
the Fifty-Fifty General Assembly on September 2000. A millennium Declaration
was made, according to which the countries reaffirmed their commitment to
improve the living conditions of poor and downtrodden in the world by adopting
intense poverty alleviation programmes. One of the targets of this declaration
was adherent to “In co-operation with the private sector make available the
benefits of new technologies, especially information and communication”. The
indicators that were to be used for monitoring the progress were:
76
• Internet user per 100 units of population.
77
Table 3.1: Cellular Tariffs across South – Eastern Countries
Table 3.1 explains that the mobile tariffs in India have also become lowest
in the world. A new mobile connection can be activated with a monthly
commitment of US$ 5-6 only.
India has become one of the fastest growing mobile markets in the world.
The mobile services were commercially launched in August 1995 in India. In the
initial 5-6 years the average monthly subscribers additions were around 0.05 to
0.1 million only and the total mobile subscribers base in December 2002 stood at
10.5 millions. However, after the number of proactive initiatives taken by
regulator and licensor, the monthly mobile subscriber additions increased to
around 2 million per month in the year 2003-04 and 2004-05.
(Subscribers in Millions)
2005-06 2006-07
March Feb. Additions Mar. *March* Dec. Jan. Feb. Addi- Addi- Additions
2005 2006 during 2006 2006 2006 2007 2007 tions tions during
April05- (As per During During April06-
Feb. 06 new Jan. Feb. Feb. 07
policy)
Wireless 52.22# 84.89# 31.21 90.14 98.78 149.50 156.31 162.53 6.81 6.22 63.75
Fixed 46.19 49.45 2.95 50.18 41.54 40.43 40.40 40.39 -0.03 -0.01 -1.15
Total 98.41 134.34 34.16 140.32 140.32 189.93 196.71 202.92 6.78 6.21 62.60
# Excluding WLL-F Subs. * WLL-F subs. Included in Wireless Subs. w.e.f. March 2006
78
Table 3.2 explains the total number of telephone subscribers have
reached 202.74 million at the end of February 2007 as compared to 196.91
million in January 2007. The overall tele-density has increased to 18.26 in
February 2007 as compared to 17.45 in January 2007. In the wireless segment,
6.22 million lines have been provided in February 2007 while 6.81 million lines
were provided in January 2007. The total wireless subscriber (GSM, CDMA &
WLL(F)) base is 162.53 million now. Whereas in the wireline segment with the
minor reduction in subscriber base by 0.01 million lines in February 2007, the
total wireline subscribers are now 40.39 million. During the eleven months of
current financial year 62.60 million lines have been added as compared to 35.93
million lines provision in the same period during the financial year 2005-06.
On the lines of previous three years, the year 2005-06 also witnessed a
phenomenal growth in the subscriber base for mobile services, and also
increase in the subscriber base of Fixed including WLL (F) services as well as
Internet services, thus building on the growth trend in subscriber base
experienced since mid-1990s. The mobile Industry crossed the 90.14 million
subscriber mark at the end of the financial year in comparison to the subscriber
base of 52.22 million at the end of March, 2005. It added 37.92 million
subscribers in the financial year 2005-06 registering an annual growth rate of
about 72.62%. The subscriber base of Fixed including WLL (F) services also
grew from 46.19 million at the end of March, 2005 to 50.17 million at the end of
March, 2006, registering a growth rate of about 8.62%. The Internet subscriber
base in the country as of 31st March, 2006 stood at 6.93 million as compared to
5.55 million during the previous year, and registered an annual growth rate of
about 25%. The tele-density at the end of March, 2006 reached to the mark of
14% as compared to 9.08% at the end of previous year recording an increase of
4.92%. This annual growth in tele-density is unprecedented and this was largely
due to steep increase in mobile subscriber base and the various innovative tariff
plans launched by the mobile service providers. This growth in tele-density also
becomes very significant in view of the fact that overall increase in tele-density
during the 50 years period from 1948 to 1998 on a much smaller population base
was only 1.92%.
79
3.4 TRANSITION OF INDIAN TELECOM INDUSTRY
The history of the Indian Telecom sector goes way back to 1851, when
the first operational land lines were laid by the then British Government in
Calcutta. With independence, all foreign telecommunication companies were
nationalized to form Post, Telephone and Telegraph, a monopoly run by the
Government of India.
Ministry of
Communi-
cations
Regulating
Telecom Bodies of Department of
Commission Indian Telecommuni-
Telecom cation
Industry
Telecom
Regulatory
Authority of
India
80
Ministry of Communication: All the operations of this sector come under
the purview of MoC. It is responsible for all major policy changes, planning,
supervision, spectrum control, etc.
81
have motivated all the partners to contribute in accelerating the growth of the
sector.
The other entities in the sector under the control of MoC are the two
public sector telecom equipment manufacturers, namely Indian Telephone
Industries (ITI) and Hindustan Teleprinters Ltd. (HTL). Both these companies are
facing financial problems because of product obsolescence, poor management
and over staffing. Telecommunications Consultants India Ltd. (TCIL), another
PSU was founded in 1978 to undertake consultancy services in the field of
telecom.
82
• Strengthen research and development efforts in the country and provide
an impetus to build world-class manufacturing capabilities.
• Telephone services
• NSD/ISD services
• Computerised trunk services
• Pay phones
• National & international leased lines circuits
• Telex
• Telegraph services (manual & automatic)
• X-25 based Packer Switched Data Network (NET)
• Gateway Packet Switched Data Services (GPSS)
• Gateway Electronic Data Interchange Service (GEDIS)
• Gateway E-Mail and Store & Forward FAX Service (GEMS-400)
• Concert Packet Service (CPS)
• Satellite based remote area business message network
• Electronic Mail
• Voice Mail
• Audio-text
• Radio paging
• Cellular mobile telephone
• Public mobile radio trunked service
83
• Video-tex
• Video conferencing
• V-SAT
• Internet
• ISDN
• INMARSAT mobile service
• INMARSAT data service
• Home country direct service
• Intelligent Network (IN) services
Table 3.4 exhibits various Indian telecom services for the period 2005-
2006 and 2006-2007 and growth for this period. Major telecom services of Indian
economy cover-fixed access, cellular national long distance, international long
distance, internet access, VSAT, radio trunking. Amongst them, international
long distance services and cellular services have recorded 89 and 57% growth
respectively,
84
June-05 quarter, translating into a growth rate of 9.63%. Growth in average
subscriber base in the corresponding period has been 11.77%.
• The all India blended ARPU per month has gone down by about 1.9%
from Rs. 381 in the quarter ending June-05 to Rs. 374 in the quarter
ending Sept-05.
• The lowest blended ARPU per month is in Circle B (Rs. 330), which is
higher than the previous quarter’s corresponding figure (Rs. 327). The
highest blended ARPU is in Metro (Rs. 438).
• Monthly ARPU in postpaid segment has declined from Rs. 662 in June-05
to Rs. 646 in Sept-05. On the other hand, prepaid segment has shown a
marginal increase in ARPU per month from Rs. 282 in June-05 to Rs. 284
in Sept-05.
3.4.4 Teledensity
85
accessible means of communication, which means the country is coherent with
the development goals. In India, deliberate attempts made by the government to
increase teledensity have been fruitful with private participation in both fixed and
mobile telephony.
While the urban teledensity was more than 20, the rural teledensity was
lesser than 2, contributing to a national teledensity of 8.02, for the year 2005-06.
This has increased from a mere 1.28 in 1995-96. The increase in urban
teledensity was primarily due to heavy cellular penetration since 2000-01. The
specific information as to the teledensity as pertaining to different circles for
year2005-06 is as follows:
• Six states have teledensity greater than 10% - Punjab, Kerala, Andaman
& Nicobar, Himachal Pradesh and Gujarat.
• Teledensity in the metros was – Delhi 42%, Mumbai 36%, Chennai 39%
and Kolkata 19%.
Service providers are facing the severity of dipping voice ARPUs and high
subscriber churn rate. With new and cheaper schemes being introduced
everyday, mobile content and applications are the only way to keep a subscriber
glued to particular services. Innovation is the key here; the more innovative a
service, the more popular it gets and more revenue it brings in. Presently value
added services (VAS) accounts for 10-12% of the operator’s revenue, but in the
next 10 years the growth of mobile industry is expected to be driven by mobile
VASs as they will form 60% of the revenue of the mobile network operators.
86
encompasses music, gaming videos etc, is expected to grow 10 times in the next
five years.
More than 70% of the country’s population lived in village. The growth of
telephone network in rural India has not been quite encouraging post-
privatisation. While the urban area has the most developed form of
communication, nearly 20% of the rural area is left unlinked. The rural
teledensity was at a very low 1.55. This is due to very slow or no (in some areas)
cellular penetration. In the fixed line segment also, the only service provider for
rural areas was the public sector service provider. The private players were not
interested to invest in rural areas, due to earning sensitivity issues. More than
increasing the individual phones, the government is initially concentrating to
increase the number of public phones in villages, namely (Village Public
Telephones) VPTs.
87
• Greater use of online service in commerce, industry and transportation
will create a boom for broadband. The regulatory for suggested a range of
measures for an open-sky policy for DTH, VSAT and uplinking using
satellites that should boost broadband.
• In the last decade since satellite TV started, there has been a huge
growth in subscriber number. Cable/satellite homes are estimated to be
40 million. India has close to 100 million TV homes currently. Total
viewership at 400 million is among the highest in the world. The Radio
Committee preparing the draft rules for radio broadcast, is expected to
moot 26% FDI kin FM Radio, FM stations may be allowed to beam news
contents.
88
million surrenders in the fixed line segment for the year ending December 2006.
The firms, which were notorious for bureaucratic attitudes and lethargic
operations, are now pulling up their sleeves to fight the competition, before it is
too late.
The policy and regulatory regime established by the Government and the
regulator has led to speedy growth of subscriber base of the incumbent Public
Sector Undertakings as well as that of the private sector operators.
90
Subscriber Base (in million)
80
70
60
50
40
30
20
10
0
1998 1999 2000 2001 2002 2003 2004 2005 2006
The figure 3.2 shows the growth in subscriber base of private operators
and public sector undertaking. Private operators have also shown remarkable
growth in a highly competitive environment. The overall growth in the subscriber
base of private operators during 1998-2006 was 78.36 million comprising of 7.92
million fixed subscribers and 70.44 million mobile subscribers. Private operators
have contributed very largely to post 1998 growth in mobile services due to the
obvious cost and fast deployment advantages. During the period 1998-2006, the
absolute growth in subscriber base of PSU operators was 43.28 million
comprising of 23.58 million fixed subscribers and 19.70 million mobile
subscribers.
89
With the entrance of private players in the market, the competition is
further stiffened, and the players are eying the market to make hay when the sun
shines. With the advent of competitive environment in the industry, the most
excited are the consumers, who are emerging the kings in the industry. They are
not only given alternatives to choose, but they also become the deciders of the
fate of players, who do not provide them the quality of service they expect. At
this juncture it is imperative to analyse the shift in pattern of consumer decision-
making and choice, and also the strategies adopted by the players to satisfy
them, in order to gain an edge in competition.
90
• Telecom is high technology industry. Telecom equipment is highly
complex to design and needs the expertise of both telecom and
computing fields. With the advent of competition, tremendous innovation
in services was made possible by improving the quality of technology by
the players.
As per the FDI policy for the Telecom Sector, investment up to 49% is
permitted in Basic, Cellular and other value added services, which is hiked to
74%; up to 74% is permitted in Internet, infrastructure and radio paging services
and up to 100% is permitted in manufacturing, Internet service, voice and
electronic mail, based on certain conditions for fulfillment as a part of licensing
and security requirements, laid down by the Department of Telecommunications,
Government of India. Several announcements were made relating to policy
change covering change of ADC from per minute charges to revenue share, and
mobile number portability. FDI ceiling increment has led to an increase in FDI in
mobile services whereas ADC has resulted in reduction of mobile tariffs in the
country. On the policy front, per minute ADC on domestic calls was changed to
revenue share regime. And the percentage charged is 1.5% of AGR (adjusted
gross revenue).
The Indian entrepreneurs in the Telecom sector, used the provision of FDI
to the fullest possible extent, and the FDI inflow into the sector was the second
highest for the period 2003-04, after the petroleum, oil refinery sector. The
91
distribution of FDI inflow into various service areas upto March 2006, with
percentages is shown in the table given below:
Table 3.5 explains that during the year 2006, 926 approvals for FDI were
given amounting to a huge sum of Rs.57,260.14 crore as total approvals, out of
which Rs.99509 crores actually flew in to the economy for the period.
With 74% FDI, India has seen huge investments from players like Vodafone
in Bharti Airtel, Temasek Holdings in Tata Teleservices, Orascom in HTIL, Maxis
in Aircel, and Telekom Malyasia Berhad in Spice. Vodafone Group secured
around 10% interest in Bharti Tele-Ventures for an investment of approximately
Rs.6,700 crore. Temasek Holdings (Temasek), through its wholly owned
subsidiary, Aranda Investments (Mauritius) has taken a 9.9% stake in Tata
Teleservices for an undisclosed amount. Maxis has invested 26% in the
enlarged share capital of the AircelGroup for $280 mn. And later, Maxis along
with an Indian partner is planning to acquire the remaining 74% for Aircel for
$800 mn. Maxis acquired additional 34% for $422 mn and rest 35% through SPV
92
for $378 mn. Telekom Malaysia Berhad has acquired 49% stake in Spice
Communications for $178.8 mn.
As per TRAI, two other associated aspects for market growth are
availability of spectrum and availability of resources for network rollout and
expansion. The government is currently looking into these two areas. The 79%
hike in FDI has been cleared by the government to ensure continuous flow of
investments to expand the reach of the mobile operators.
India is a young country and 26.5% of the population belongs to the age
group of 15-24 years. Of the estimated total individuals of age above 12 years
(707 million), youths consist of 187 million in both urban and rural markets. Of
this segment, 30% stay in urban areas and ensuring a mobile connection in the
hand of each youth would mean 56 million mobile phones. This means that a
whopping number of people can be tapped by the mobile phone industry;
93
Mobile Market Potential Estimated: 56 million.
India has over 8,000 towns with a population of over 5000 and offers the
potential to sell a minimum of 1,000 mobile connections within a couple of years
of launch. However, currently only 1,600 towns are covered under the mobile
network by all service providers put together. This is where great opportunity lies
untapped and the first entrant is bound to gain substantially. The potential
untapped is 6400x Avg.l000 connections = 6.4 million mobile connections in the
next 15 months.
In the same way; India has over 6,30,000 villages and out of it over
14,000 villages have a population of over 5000 and offer the potential to sell a
minimum of 500-1000 mobile connections within a couple of years of its launch.
However, currently very few villages are covered under the mobile network, as
the focus of service providers is to cover towns with high income first. With huge
penetration of consumer goods happening in the villages, the aspiration levels of
the people are soaring and a great opportunity lies untapped. However, very few
94
mobile operators have ventured to cover villages till now. Just a simple
calculation will reveal that an untapped potential of 14,000 x Avg.750 = 10.5
million mobile connections in the villages in the next 15 months.
The Total Market Potential through Four Focus Segments: 132.3 million.
95
Table 3.6: Potential of Indian Telecom Industry
c. Urban households with assets like 47.0 4 million – the very rich, 40.8 million –
scooter, car, radio and TV, the consuming class, out of the total
classified as the very rich and the urban households, growing by 5%.
consuming class
d. Rural households with assets like 37.8 12 million – the very rich, 34.8 million –
scooter, car, radio and TV, the consuming class, out of the total
classified as the very rich and the rural households, growing by 5%
consuming class
7. Potential urban market for mobile 51.24 (Assuming 2 mobiles per households
(HH) x 4.2 mn very rich +1 mobile per
HH x 42.84 million consuming)
8. Potential rural market for mobile 37.32 (Assuming 2 mobiles per households x
1.26 million very rich + 1 mobile per
HH x 34.8 million consuming class)
Total Mobile penetration by December 9.8%
2006
Source: The Marketing Whitebook – Businessworld
96
industry should adopt this strategy so that the overall mobile market expands
exponentially.
Despite the presence of only four mobile operators in Punjab (against six
in most of the other states), due to aggressive market expansion and
segmentation strategy followed. The total mobile population has crossed 8.21
million by October 2006 for a population of just 34.35 million. Most states
industrially advanced states are at just 6% mobile penetration, clearly illustrating
the lead achieved by Punjab. Today; the mobile network covers every urban
town and most of the rural villages and all highways in Punjab, which has
enabled the state's economy to grow substantially. The aggressive "marketing of
the services by operators has ensured that most of the youth, executives and
families in Punjab own a mobile.
1. To ensure that every youth has a mobile, service providers have to offer
services like SMS/MMS at low cost/free and ensure that the total mobile
bill for the youth does not cross Rs.300-400 per month, which is the
maximum this segment of customers can afford from their pocket money;
97
4. To ensure that the penetration targeted in towns and villages is achieved,
service providers have to invest in network expansion and reach out on
priority; to exploit the untapped potential in these markets.
5. To expand the network to a large number of towns and villages by all the
operators, network sharing should be allowed by BSNL and the
government should allow 74% FDI in mobile companies for easy access
to funds.
6. Lastly; both service providers and handset vendors have to combine their
strengths and address the issue of market expansion on priority and
launch aggressive programs to make mobile phones affordable and
available to all.
98
Table 3.7: Subscriber Base of GSM Service Providers
for the period 2004-2006
The Cellular GSM services reached the 69.19 million subscriber mark at
the end of the financial year 2005-06, as compared to 41.07 million during the
previous year. It added around 28.12 million subscribers during the year, with a
remarkable growth of around 68.47%. Reliance and Bharti have acquired
licenses in all 23 service areas for offering mobile services. Bharti and Reliance
are the only private operators which providing services in All India, i.e., 23
service areas.
Table 3.8: Subscriber Base of CDMA Operators for the period 2004-06
99
The Table 3.8 explains the CDMA Subscribers Base for the period of
2004-2006.It has reached 25.95 million during the year 2006 as against 6.474
million for the year 2004. Reliance remains the largest CDMA operator followed
by Tata Teleservices and BSNL with subscribers’ base of 6.85 million, 0.49
million respectively. CDMA subscriber base recorded a growth of 33.2% during
this period.
Bharti, a part of Bharti Enterprises, was the first to launch its cellular
service on July 7, 1995. Bharti's cellular services were launched under the brand
name ‘Airtel’ and were categorized as pre-paid services and post-paids services.
The postpaid service was launched under the brand name ‘Airtel’ whereas its
prepaid services were launched under the brand name "Magic". As of March
2005, the company operated in 23 telecom circles and had the largest subscriber
base of all service providers at over 9.8 million.
The Tata group of companies also launched their cellular service called
Tata Cellular in the year 1995. In 1996, the Tata group was the first to launch
CDMA mobile services in India, under the brand name Tata Teleservices
(TTSL). TTSL's telephony services included mobile services, Fixed Wireless
Phones (FWP), public booth telephony and wireline services. The company
launched a prepaid card under the Tata Indicom brand with the tagline "100%
Sacchai True Paid". Later in May 2002, Tata Cellular was merged with Birla-
100
AT&T giving rise to a brand called "Idea Cellular" (Idea). The conglomerate's
prepaid service was launched under the brand name "Idea Chit-Chat". As of
2005, Idea operated in 8 telecom circles with a subscriber base of over 4.6
million.
3.9.1 Airtel
With liberalization of the Indian economy in the early nineties the telecom
industry was thrown open to the private sector. This saw the entry of a number of
major players into the services division. The Bharti group was one of the first to
seize the opportunity provided by the government of India and established Bharti
Tele-Ventures to provide the full range of telephony services for both mobile and
landline connections.
101
investments in telecommunications services. With just 4 mobile operators In the
country, the potential for Bharti is immense. Through its subsidiaries, it has
licenses to provide GSM services in 15 of the 22 telecom circles in India.
AirTel, its mobile arm, cakes care of all cellular services co ensure that
communication is faultless and cost efficient. The strategic objective is co
achieve and maintain leadership in the industry within the country. In September
2004, Bharti Televentures limited has brought all its telecom services under the
‘AirTel'’ brand umbrella. With the result of this unified branding strategy, all the
other supplementary brands like Touchtel, IndiaOne and Mantra cease to exist.
Under this the services would be called AirTel Mobile Services, AirTel Telephone
& Broadband services, AirTel Long Distance Services, AirTel Enterprise
Services. This strategy has been in accordance with the government policy to
launch unified licensing, which will allow cellular and landline companies to offer
their individual services under the same license.Like any other telecom service
provider, Bharti also considers information technology a key driver of its
business.
Gartner analyst, Kobita Desai says, “Developed markets like Australia and
Hong Kong have a mnthly churn rate of 3 percent, which usually occurs in the
postpaid segment. India, being an emerging market, is driven by the prepaid
segment.” The churn in telecom industry is due to many factors, viz., age,
profession, usage pattern, etc., which the present CRM system cannot address
effectively. Hence, there is a need for exclusive CRM software which can handle
other factors also. Both prepaid and post-paid sections are inherent in mobile
telephony business. According to industry experts, the prepaid segment is a
crucial growth area as they provide up to 55 percent of the operators' revenue
The telecom industry today is all about big numbers and volumes-read
customer satisfaction. This spells good news for telecom service provider TTSL,
which believes in top-of-class customer services. Tata Teleservices Limited
(TTSL), a part of the Tata Group – one of India’s largest business houses with
more than 80 companies in the fold-is a premium telecom services provider.
102
TTSL was established by Tata Industries to leverage the liberalised regime in the
telecom sector and to provide quality telecom (data/voice) services to retail as
well as corporate customers. TTSL provides basic telephony services and
complements and competes with the state-owned Bharat Sanchar Nigam
Limited (BSNL) in the circles it operates in. In the past two years the company
has been successful in entering major towns in Andhra Pradesh. Around a year
ago, it started providing basic and WLL-based services in New Delhi. TTSL has
also applied for fresh basic and WLL licenses in eight more telecom circles.
TTSL has so far been able to provide approximately two lakh connections
in Andhra Pradesh alone. In this circle, the number of subscribers is growing at
more than 70 percent year-an-year. As part of its expansion plans, TTSL
successfully bid to establish its high quality telecom infrastructure in five other
circles (states). TTSL has already invested $400 million for rolling out services in
Andhra Pradesh and plans to invest another $1.7 billion over the next five years
to expand its services across the planned service areas. TTSLS plans for service
roll-out cover 56 percent of the incumbents (BSNL/MTNL) telephone subscriber
base, and accounts for about 65 percent of the incumbents' revenues. If
estimates do work in the expected direction, the company is certain to have
nearly five to six million customers over the next five years.
With a significant presence across the telecom value chain and the
synergies after tile acquisition of VSNL by the Tata group, TTSL is planning to
expand the range of its coverage and services; advanced communication
solutions now include seamless integration of voice, video, data and IP systems.
As a basic telephone services provider, TTSL provides the backbone for India’s
corporate leaders such as GE Capital, Wipro, Magnacom, Citicorp Overseas
software (now called Orbitech), Dr. Reddy’s Labs, Standard Chartered Bank,
Motorola India Electronics, TCS and Satyam, in addition to servicing the telecom
needs of retail customers.
But the entire telecom infrastructure was of little use until customers were
serviced satisfactorily. After putting in place the required equipment and
infrastructure, TTSL was committed to setting up a CRM solution that would
103
carer to the varied needs of its vast customer base, “Oracle E-Business Suite
has played an important role in helping TTSL meet its customer service needs,
thereby making it a joy for customers to interact with our company,” says S
Ramakrishnan, managing director, Tata Teleservices.
In order to build its customer base, the TTSL management understood the
need to have robust infrastructure in place to ensure quality customer service.
This was to be a key differentiator for TTSL in the competitive landscape it was
operating in. This was also a compelling need for the private sector service
provider, as customer expectations were very high.
• Ensure that customers could access and get information about various
services easily.
104
3.9.3 Hutchison Essar Limited
In the past year, five entities have been clubbed under Hutchison Max
Te1ecom Limited (HMTL), which has now been rechristened Hutchison Essar
Limited. This is the holding company of all five 'Hutch affiliates in India. The
group has brought its services under the “Hutch” banner, except in Mumbai circle
where it uses the “Orange” brand name.
105
3.9.4 Reliance Infocomm Limited
In May 2004, Reliance Infocomm Limited, one of the leading in the fastest
growing telecommunications companies in the country, was conferred the ‘Most
Promising Service Provider of the Year 2003 (Asia Pacific) award at the Asia
Pacific Technology Awards instituted by Frost & Sullivan. Given that Reliance
Infocomm Limited received the award within the first year of the launch of its
telecommunications services in India, this international recognition was
considered on mean achievement for the company.
Analysts felt that the Primary reason for the success of Reliance
Infocomm in the Indian telecom industry was its aggressive marketing strategy.
Reliance Infocomm used all the tactics which it could to win over the hearts of
millions of customers (10.3 million subscribers as per reports of January 2005) in
India. It offered a first of its kind technology in India (The CDMA technology)
attractive products.
The first phase begins in 2003 and aims at providing the Reliance India
Mobile service through a nationwide wireless network reaching out to nearly 90%
of India’s population. The second phase beginning in mid 2003, aims at bringing
about enterprise netway revolution, by providing 100 mbps Ethernet links. The
final phase begins in end 2003, with the objective of bringing about a consumer
convergence revolution, by providing high speed Ethernet links to enlighten
every home an entire range of television channels, high-speed telephony, audio
conferencing, videoconferencing and video on demand.
Priced to suit, the common man's budget, and backed these up with
massive aggressive promotion campaigns, using every possible medium of
communication. It continuously flooded the markets with new offers, new
106
schemes, particularly during the festive seasons, and thereby ensured that it
always caught the attention of people. In the process, Reliance Infocomm
Limited demonstrated the importance that marketing discipline holds in the
success of a company to the academic and corporate community alike. In 2006,
Reliance Infocomm has been renamed as Reliance Communications Limited.
3.10 CONCLUSION
107
CHAPTER – 4
4.1 INTRODUCTION
108
Relationship marketing has been defined in several ways. Berry (1983)
defined relationship marketing as attracting, maintaining and enhancing
customer relationships. He advocated a number of relationship strategies,
including a core service strategy, customisation; relationship pricing, and internal
marketing. Similarly, Jackson (1985) referred to industrial relationship marketing
as efforts oriented towards strong, lasting relationships with individual accounts.
Predominant among most definitions of relationship marketing is the view that
buyer-seller encounters accumulate over time, and opportunities exist to
transform individual and discrete transactions into relational partnerships
(Czepiel, 1990). This view supports the notion that a relationship exists when an
individual exchange is assessed not in isolation, but as a continuation of past
exchanges likely to continue into the future. Perceived in this way, customer
acquisition is only an intermediate step in the marketing process, with the
ultimate goal being to strengthen already strong relationships, and to convert
indifferent customers into loyal ones (Berry and Parasuraman, 1991).
Consequently, relationship marketing may be used to describe a plethora of
marketing relationships, such as those between a firm and its buyers, suppliers,
employees and regulators (Morgan and Hunt, 1994).
109
in the current marketplace (Christopher et al., 1991; Lehtinen, 1996). Regarding
practice, firms are also considering the adoption of relationship marketing
strategies as critical for sustaining a competitive advantage (Sharma et al.,
1999). Due to above reasons, the philosophy of relationship marketing is being
advocated more and more strongly by marketers (Gummesson, 1994).
110
efforts to improving important attributes on both the interpersonal as well as
company level. In doing so, firms striving for true customer intimacy can find
ways to bridge the perceptual gap between the two levels of relationships
highlighted above.
111
research in that trust is defined in terms of a customer’s perceptions of service
representative confidentiality, honesty, integrity and high ethical standards.
These two definitions of trust draw on Rotter’s (1967) classic view that
trust is:
“… a partner’s belief that the other partner will perform actions that will
result in positive outcomes, as well as not take unexpected actions that would
result in negative outcomes.”
112
Finally, Gronroos (1996) suggests that:
113
(Mowday et al., 1982). This perspective is consistent with Dwyer et al.’s (1987)
definition of commitment in a buyer-seller relationship as the existence of:
Supplier Partnerships
Goods Service
Suppliers Suppliers
Business Competitors
Units
Employees Government
Focal Firm
Financial Ultimate
Customers
Intermediate
Customers
Internal Partnerships Buyer Partnerships
114
Figure 4.1 explains the relational exchanges between the focal firm and
various agencies for building discrete relationships.
115
Figure 4.2: The Hypothesized Realm of Buyer Seller Relationship
High
Buyer’s market
Buyers Motivational
Investment in relationship
Low High
Buyer maintained relation
Discrete exchange
(spot contract)
Seller’s
Market
116
4.3.1 Phase-I Awareness
Commitment
Exploration
Awareness
Dissolution
Expansion
Strength of Relationship
Time
• Attraction
• Norm development
• Expectation development
117
4.3.3 Phase-III Expansion
118
4.4 TRUST AND COMMITMENT AS KEY MEDIATING VARIABLES
c) View potentially high risk action as being prudent because of the belief
that their partners will not act opportunistically.
Therefore, when both commitment and trust-not just one or the other-are
present, they produce outcomes that promote efficiency, productivity and
effectiveness. In short, commitment and trust lead directly to co-operative
behaviours that are conductive in relationship marketing success.
− Retained business
− Sales, marketing and set up costs are amortised over a longer customer
lifetime
119
− Increased expenditure over time
LOYAL CUSTOMERS
• Better responsiveness
CRM to customer needs Relationship • Increased ARPU*
Program • Increased customer • Stronger brand attitude
satisfaction • Less price sensitive
• Educe customer chum
Customer
Database
Cross-selling
• Increase ARPU*
In some cases such managers work within service business where the
profit impact of retention has already been identified such as banking, credit
cards, insurances broking, commercial laundries, etc. (Reichheld and Sasser
1990). However, uncomfortable with direct analogies being made between their
business and other industrial sectors. In particular, they wish to learn whether a
given improvement in retention (for example, five percentage points will have a
low improvement in NPV profitability (say 10-20%) or a high improvement in
NPV profitability (say 80-100%)
120
recollections or other reliable information to help understand a person’s or
group’s competencies, preferences, and moral habits).
Empathetic trust assumes that one party has fully internalized the other
party’s preferences, and demands that both parties commit to building and
maintaining a personal relationship. Thus, information sharing and joint problem
solving can occur with very little transaction cost-if empathetic trust rules.
Edward Deming (1986), have `long argued that using rewards and punishments
tends destroy the internalization of others; preferences destroy the internalization
of others preferences essential for deep trust.
121
4.6 TRUST AND PROFITABILITY
122
experienced some significant implementation problems. Examples include, the
high turnover rates of staff in call centers, the frequent cost blowouts associated
with constructing a data warehouse, problems implementing new information
technology systems, and the high cost involved in designing anew information
The top row of effects leads to building relationships with customers and
thus established customer loyalty. Depending on the type of product (e.g., high
or low involvement), this relationship can be based on an affective association.
123
CHAPTER – 5
(PART-A)
Prior to analysis of the results, the research instrument was tested for its
reliability. Several measures of reliability can ascertain the reliability of a
measuring instrument. These include test-retest method, equivalent forms, split
halves method and internal consistency method. Of all the above methods, the
internal consistency method requires only one administration and consequently
is supposed to be most effective, especially in field studies. Moreover, this
method is considered to be the most general form of reliability analysis. In this
method, reliability is operationalised as internal consistency, which is the degree
of inter correlation among the items that constitute a scale. Internal consistency
is estimated using a reliability coefficient called Cronbach’s alpha. An alpha
value of 0.60 and 0.70 or above is considered to be the criterion for
demonstrating internal consistency of new scales and established scales
124
respectively. Reliability of the measurements was determined using Cronbach’s
Coefficient alpha. In this research, following are the research for the data
collected from subscribers:
RELIABILITY ANALYSIS - SCALE (ALPHA)
Opportunistic
1 .843(**) 0.27
Behaviour
Trust 1 .419(*)
Relationship
1
Commitment
**Correlation is significant at the 0.01 level (2-tailed).
* Correlation is significant at the 0.05 level (2-tailed).
125
The above table 5.1 shows Pearson’s correlation between key mediating
variables of Reliance prepaid subscribers. The correlation between shared value
and communication (.694), shared value and opportunistic behaviour (.697),
shared value and trust (.793) and shared value and relationship commitment
(.620) is highly significant amongst prepaid subscribers of Reliance. Similarly,
the relationship between communication and opportunistic behaviour (.588),
communication and trust (.665) and communication and relationship commitment
(.610) is highly significant. The correlation between opportunistic behaviour and
trust (.843) is highly significant and trust and relationship commitment (.419) is
significant amongst prepaid subscribers of Reliance. However, correlation
between opportunistic behavior and relationship commitment is non-significant.
Opportunistic
1 .566(**) .641(**)
Behaviour
Trust 1 .550(**)
Relationship
1
Commitment
** Correlation is significant at the 0.01 level (2-tailed).
* Correlation is significant at the 0.051 level (2-tailed).
The above table 5.2 shows Pearson’s correlation between key mediating
variables of Airtel prepaid subscribers. The above table depicts highly significant
at .01 level correlations between shared value and opportunistic behavior (.644)
and significant correlation between shared value and relationship commitment
amongst prepaid subscribers of Airtel. However, it has non-significant
relationship with communication and trust. Communication is highly significant in
relation to opportunistic behaviour (.680) and trust (.845) and relationship
commitment (.591). Opportunistic behaviour is highly significant in relation to
126
trust (.566) and relationship commitment (.641). Trust is highly significant in
relation to relationship commitment (.550) of prepaid subscribers of Airtel.
Opportunistic
1 .714(**) .677(**)
Behaviour
Trust 1 .619(**)
Relationship
1
Commitment
The above table 5.3 shows Pearson’s correlation between key mediating
variables of Hutch prepaid subscribers The above table shows highly significant
correlation between shared value and communication (.717), shared value and
opportunistic behaviour (.699),shared value and trust(.645) and shared value
and relationship commitment (.554) of prepaid subscribers of Hutch. Similarly,
the correlation between communications and opportunistic behaviour (.670),
communication and trust (.740) and communication and relationship commitment
(.730) is highly significant. The correlation between opportunistic behaviour and
trust (.714) and opportunistic behaviour and relationship commitment (.677) is
highly significant. Similarly, the relationship between trust and commitment
(.619) is highly significant amongst prepaid subscribers of Hutch.
127
Table 5.4: Evaluation of Relationship between Key Mediating Variables of
Tata Indicom Prepaid Subscribers
Opportunistic
1 .873(**) .866(**)
Behaviour
Trust 1 .807(**)
Relationship
1
Commitment
The above table 5.4 shows Pearson’s correlation between key mediating
variables of Tata prepaid subscribers. The above correlation matrix explains
highly significant relationship between shared value and communication (.895),
shared value and opportunistic behaviour (.874), shared value and trust (.808)
and shared value of shared value and relationship commitment (.848). Similarly,
the relation between communication and opportunistic behaviour (.900),
communication and trust (.844) and communication and relationship commitment
(.862) is highly significant at 99level. The correlation between opportunistic
behaviour and trust (.873), opportunistic behaviour and relationship commitment
(.866) and trust and relationship commitment is highly significant amongst
prepaid subscribers of Tata Indicom.
128
Table 5.5: Evaluation of Relationship between Key Mediating Variables of
Reliance Postpaid Subscribers
Opportunistic
1 .767(**) .607(**)
Behaviour
Trust 1 .830(**)
Relationship
1
Commitment
The above table 5.5 shows Pearson’s correlation between key mediating
variables of Reliance postpaid subscribers. As can be checked from the table,
Pearson’s correlation is highly significant amongst postpaid subscribers of
Reliance between shared value and communication (.822), shared value and
opportunistic behaviour (.765), shared value and trust (.803) and shared value
and relationship commitment (.747). Similarly, the relation between
communication and opportunistic behaviour (.806), communication and trust
(.911) and communication and relationship commitment (.809) is highly
significant at 99level. The correlation between opportunistic behaviour and trust
(.767), opportunistic behaviour and relationship commitment (.607) and trust and
relationship commitment (.830) is highly significant amongst postpaid
subscribers of Reliance.
129
Table 5.6: Evaluation of Relationship between Key Mediating Variables of
Airtel Postpaid Subscribers
Opportunistic
1 .648(**) .462(**)
Behaviour
Trust 1 .638(**)
Relationship
1
Commitment
The above table 5.6 shows Pearson’s correlation between key mediating
variables of Airtel postpaid subscribers. As can be checked from the table,
Pearson’s correlation is highly significant amongst postpaid subscribers of Airtel
between shared value and communication (.643), shared value and opportunistic
behaviour (.341), shared value and trust (.593) and shared value and
relationship commitment (.508). Similarly, the relation between communication
and opportunistic behaviour (.426), communication and trust (.668) and
communication and relationship commitment (.519) is highly significant. The
correlation between opportunistic behaviour and trust (.648), opportunistic
behaviour and relationship commitment (.462)) and trust and relationship
commitment (.638) is highly significant amongst postpaid subscribers of Airtel.
130
Table 5.7: Evaluation of Relationship between Key Mediating Variables of
Hutch Postpaid Subscribers
Opportunistic
1 .587(**) .560(**)
behaviour
Trust 1 .534(**)
Relationship
1
commitment
The above table 5.7 shows Pearson’s correlation between key mediating
variables of Hutch postpaid subscribers. As can be seen from the table,
Pearson’s correlation is highly significant amongst postpaid subscribers of Hutch
between shared value and communication (.514), shared value and opportunistic
behaviour (.548), and shared value and trust (.435) But the relationship between
shared value and relationship commitment (.285) is significant at .05 level.
Similarly, the relation between communication and opportunistic behaviour
(.777), communication and trust (.636) and communication and relationship
commitment (.590) is highly significant at 99% level. The correlation between
opportunistic behaviour and trust (.587), opportunistic behaviour and relationship
commitment (.560)) and trust and relationship commitment (.534) is highly
significant amongst postpaid subscribers of Hutch.
131
Table 5.8: Evaluation of Relationship between Key Mediating Variables of
Tata Indicom Postpaid Subscribers
Opportunistic
1 .896(**) .879(**)
behaviour
Trust 1 .796(**)
Relationship
1
commitment
The above table 5.8 shows Pearson’s correlation between key mediating
variables of Tata Indicom postpaid subscribers. As can be seen from the table,
Pearson’s correlation is highly significant amongst postpaid subscribers of Tata
Indicom between shared value and communication (.807), shared value and
opportunistic behaviour (.853), and shared value and trust (.861) and shared
value and relationship commitment (.784) is significant at .01 level. Similarly, the
relation between communication and opportunistic behaviour (.901),
communication and trust (.934) and communication and relationship commitment
(.868) is highly significant at 99% level. The correlation between opportunistic
behaviour and trust (.896), opportunistic behaviour and relationship commitment
(.879)) and trust and relationship commitment (.796) is highly significant amongst
postpaid subscribers of Tata Indicom.
132
5.4 THE EMPIRICAL TEST
5.4.1.1 Results for Shared Value between Service Provider and Prepaid
and Postpaid Subscribers
Ho1: There is no significant difference for shared value between all the
four TSP’s.
HoA: There is significant difference for shared value between all the four
TSP’s.
Ho3: There is no interaction for shared value between TSP and prepaid
and postpaid subscribers.
HoA: There is interaction for shared value between TSP and prepaid and
postpaid subscribers.
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.9.
133
Table 5.9: Two way ANOVA for Service Provider and Prepaid and Postpaid
Subscribers
The table 5.9 explains ANOVA results for shared value between Prepaid
and Postpaid subscribers (Pr/Po) for selected Telecom Service Providers (TSP).
It is observed that the variation in the shared value is significant in the prepaid
and postpaid services.
Table 5.10: Comparison of Shared Value and its Dimensions for Reliance
Subscribers
134
It is evident from table 5.10, that there is significant difference between
prepaid and postpaid subscribers for shared value, security and ethics of
Reliance. However, these differences for privacy were found to be non-
significant. In case of shared value and ethics the results are highly significant as
compared to security. Shared value and security are more important for the
postpaid subscribers as compared to prepaid subscribers but as for as ethics is
concerned prepaid subscribers are better than postpaid subscribers.
Table 5.11: Comparison of Shared Value and its Dimensions for Airtel
Subscribers
Variables Prepaid/postpaid Mean Std. Deviation t -value p –value
Prepaid 2.7333 0.6859
Shared Value 1.821 0.072
Postpaid 3.0169 0.7066
Prepaid 2.7241 0.8408
Privacy 0.974 0.333
Postpaid 2.9538 1.1379
Prepaid 2.9655 1.0851
Security 0.362 0.718
Postpaid 3.0476 0.9743
Prepaid 3.4897 0.4916
Ethics 3.437 0.001**
Postpaid 3 0.6946
** Significant at .01 level
It is evident from table 5.11, that there is significant difference between
prepaid and postpaid for ethics of Airtel. However, these differences for shared
value, privacy and security were found to be non-significant. In case of ethics are
more important for prepaid (3.48) subscribers as compared to the postpaid (3)
one.
Table 5.12: Comparison of Shared Value and its Dimensions for Hutch
Subscribers
Variables A2.2 Mean Std. Deviation t p-value
Shared Value Prepaid 2.8922 0.689
1.411 0.161
Postpaid 3.0647 0.5059
Privacy Prepaid 2.9355 0.9978
1.625 0.107
Postpaid 3.2206 0.7091
Security Prepaid 2.871 1.0565
0.42 0.675
Postpaid 2.9559 0.8713
Ethics Prepaid 3.1359 0.7686
1.02 0.313
Postpaid 2.9824 0.5361
135
It is evident from table 5.12, that there is not significant difference
between prepaid and postpaid for shared value, privacy, security and ethics of
Hutch.
Table 5.13: Comparison of Shared Value and its Dimensions for Tata
Indicom Subscribers
Ho1: There is no significant difference for shared value between all the
four cities.
HoA: There is significant difference for shared value between all the four
cities.
136
HoA: There is significant difference for shared value between prepaid
and postpaid subscribers.
Ho3: There is no interaction for shared value between city and prepaid
and postpaid subscribers.
HoA: There is interaction for shared value between city and prepaid and
postpaid subscribers.
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.14.
Table 5.14: Two Way ANOVA for Selected Cities and Prepaid and Postpaid
Subscribers
Table 5.14 exhibits ANOVA results for shared value between Prepaid and
postpaid subscribers for selected cities. It is observed that the variation in the
shared value is significant in the prepaid and postpaid services as well as in the
selected cities. The interaction between selected city and prepaid and postpaid
subscribers is also significant. Further, a Post-Hoc Scheffe’s multiple
comparisons was carried out.
137
Table 5.15: Multiple Comparisons (Selected Cities)
95% Confidence
Mean Difference Std. p- Interval
(I-J) Error value Lower Upper
(I) City (J) City
Bound Bound
Amritsar .4809(*) 0.1062 0.001 0.1827 0.7791
Above table 5.15 explain the results of a post-hoc test for multiple
comparisons among selected cities. After applying the test, it was observed that
there are significant differences between Ludhiana and other cities. But
differences are not significant amongst other cities. One of the reason could be
that Ludhiana is an industrial town and business community is very specific for
selecting the particular service provider.
Std.
Variables Prepaid/postpaid Mean t -value p -value
Deviation
Shared Prepaid 3.1679 1.0147 1.045 0.299
Value Postpaid 3.3583 0.7166
Prepaid 3.1852 1.0755 1.222 0.225
Privacy
Postpaid 3.4366 0.8406
Prepaid 3.1852 1.0755 0.575 0.566
Security
Postpaid 3.3056 0.8663
Prepaid 2.8667 1.0827 1.109 0.27
Ethics
Postpaid 2.6639 0.6837
138
Table 5.17: Comparison of Prepaid and Postpaid Subscribers for Shared
Value and its Dimensions in Amritsar City
Std.
Variables Prepaid/postpaid Mean t -value P –value
Deviation
Prepaid 2.5205 0.793
Shared Value 2.755 0.007**
Postpaid 2.9616 0.7408
Prepaid 2.3333 0.9242
Privacy 3.067 0.003**
Postpaid 3 1.0269
Prepaid 2.6061 1.2976
Security 0.599 0.551
Postpaid 2.7593 1.0628
Prepaid 3.3814 0.6998
Ethics 2.684 0.009**
Postpaid 3.0103 0.6305
139
It is evident from table 5.18, that there is significant difference between
prepaid and postpaid subscribers for shared value, privacy and ethics of
Chandigarh city. However, these differences security were found to be non-
significant. In case of shared value, privacy and ethics the results are highly
significant. Shared value and privacy are more important for the postpaid
subscribers as compared to prepaid subscribers but as for as ethics is
concerned prepaid subscribers are better than postpaid subscribers.
5.4.1.3 Results of Shared Value and its Dimensions for City-Wise and
Telecom Service Operator-Wise
Ho1: There is no significant difference for shared value between all the
four cities.
HoA: There is significant difference for shared value between all the four
cities.
Ho3: There is no interaction for shared value between city and telecom
service providers.
HoA: There is interaction for shared value between city and telecom
service providers.
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.19.
140
Table 5.19: Two Way ANOVA for Selected Cities and Telecom Service
Providers
The table 5.19 explains ANOVA results for shared value for selected
telecom service provider and for selected cities. It is observed that the variation
in the shared value is significant in the selected cities and the interaction
between different telecom service providers and selected cities is also
significant.
Table 5.20 purses the results of a post-hoc test for multiple comparisons
among selected cities. It was carried out using Scheffe’s multiple comparisons.
After applying the test, it was observed that there are significant differences
between Ludhiana and other cities. But differences are not significant amongst
other cities.
141
Table 5.21: One-Way ANOVA - Ludhiana and Telecom Service Provider
Sum of Mean
Source Of Variation df F-value p-value
Squares Square
Between
Groups 28.728 3 9.576 25.838 0.01
Shared
value Within Groups
35.209 95 0.371
Total 63.937 98
Table 5.21 exhibits that there are significant differences between Reliance,
Airtel, Hutch and Tata Indicom for Ludhiana city. Scheffe’s Post-Hoc test was
carried for multiple comparisons in order to see the significant differences
between the combination of the groups.
95% Confidence
Mean Interval
Std. p-
Difference
Dependent Error value Lower Upper
(I) TSP (J) TSP (I-J)
Variable Bound Bound
Reliance 1.2554(*) 0.174 0.001 0.7603 1.7506
Tata
Airtel 1.3301(*) 0.174 0.001 0.8349 1.8253
Indicom
Hutch 1.1621(*) 0.174 0.001 0.6669 1.6573
TSP: Telecom Service Provider
Table 5.22 depicts results of Post-Hoc Test. It was carried out to test the
significant differences for shared value amongst telecom service providers for
Ludhiana city. Differences are significant between Reliance and Tata Indicom,
Airtel and Tata Indicom, Hutch and Tata Indicom and Tata Indicom with other
operators. All other combinations of differences were found to be non-significant.
142
Table 5.23 exhibits that there are significant differences between
Reliance, Airtel, Hutch and Tata Indicom for Amritsar city. Scheffe’s Post-Hoc
test was carried for multiple comparisons in order to see the significant
differences between the combination of the groups.
95% Confidence
Mean
Std. p- Interval
Difference
Dependent Error value Lower Upper
(I) TSP (J) TSP (I-J)
Variable Bound Bound
Shared Tata
Reliance -.8697(*) 0.1985 0.001 -1.4348 -0.3046
Value Indicom
TSP: Telecom Service Provider
Table 5.24 exhibits results of One-way ANOVA. It was carried out to test
the significant differences for shared value amongst telecom service providers
for Amritsar city. Differences are significant between Reliance and Tata Indicom.
All other combinations of differences were found to be non-significant.
95% Confidence
Mean
Std. p- Interval
Difference
Dependent Error value Lower Upper
(I) TSP (J) TSP (I-J)
Variable Bound Bound
Reliance -.9765(*) 0.1698 0.001 -1.4601 -0.4929
Shared Tata
Airtel -.9539(*) 0.1639 0.001 -1.4208 -0.487
Value Indicom
Hutch -1.0533(*) 0.1622 0.001 -1.5155 -0.5912
TSP: Telecom Service Provider
143
Table 5.26 depicts results of Post-Hoc test. It was carried out to test the
significant differences for shared value amongst telecom service providers for
Patiala city. Differences are significant between Reliance and Tata Indicom,
Airtel and Tata Indicom, Hutch and Tata Indicom and Tata Indicom with other
operators. All other combinations of differences were found to be non-significant.
95% Confidence
Mean Interval
Std. p-
Difference
Dependent (J) Error value Lower Upper
(I) TSP (I-J)
Variable TSP Bound Bound
Shared
Reliance Airtel -.6800(*) 0.2184 0.026 -1.3017 -.05840
Value
TSP: Telecom Service Provider
Table 5.28 exhibits results of One-way ANOVA. It was carried out to test
the significant differences for shared value amongst telecom service providers
for Chandigarh city. Differences are significant between Reliance and Airtel. All
other combinations of differences were found to be non-significant.
144
Ho1: There is no significant difference for shared value between all the
four cities.
HoA: There is significant difference for shared value between all the four
cities.
Ho4: There is no interaction for shared value between city and telecom
service providers.
HoA: There is interaction for shared value between city and telecom
service providers.
Ho5: There is no interaction for shared value between city and prepaid
and postpaid subscribers.
HoA: There is interaction for shared value between city and prepaid and
postpaid subscribers.
Ho6: There is no interaction for shared value between TSP and prepaid
and postpaid subscribers.
HoA: There is interaction for shared value between TSP and prepaid and
postpaid subscribers.
Ho7: There is no interaction for shared value among TSP, prepaid and
postpaid subscribers and city.
HoA: There is interaction for shared value among TSP, prepaid and
postpaid subscribers and city.
145
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.29.
Table 5.29: Multiple Factor ANOVA for Prepaid and Postpaid Subscribers,
Selected Telecom Provider and Selected Cities
Table 5.29 explains the ANOVA results for shared value for prepaid and
postpaid services of selected telecom service providers and for selected cities. It
is observed that the variation in the shared value is significant in the selected
cities and the interaction between different telecom service providers and
selected cities.
Table 5.30: Comparison of Shared Value its Dimensions for Amritsar Hutch
146
Table 5.31: Comparison of Shared Value its Dimensions for Amritsar
Tata Indicom
Tables 5.30 and 5.31 indicate t-test results for prepaid and postpaid
subscribers among all telecom operators and selected cities. There are
significant differences between prepaid and postpaid subscribers of Ludhiana
Reliance, Ludhiana Airtel, Ludhiana Hutch, Amritsar Tata Indicom and Patiala
Reliance. However, the differences between other combinations are found to be
non-significant.
147
Ho2: There is no significant difference for communication between
prepaid and postpaid subscribers.
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.32.
Table 5.32: Two-Way for ANOVA Service Provider and Prepaid and
Postpaid Subscribers
148
Table 5.33: Comparison of Communication and its Dimensions for Reliance
Prepaid/pos
Variables Mean Std. Deviation t-value p-value
tpaid
Prepaid 2.7352 0.6911
Communication 2.518 0.016*
Postpaid 3.101 0.479
Prepaid 2.5359 0.8485
Openness 3.034 0.004**
Postpaid 3.0931 0.6367
Prepaid 2.7933 0.601
Speed 2.636 0.01**
Postpaid 3.1192 0.4939
Quality of Prepaid 2.816 0.7158
1.84 0.074
information Postpaid 3.0905 0.4681
Prepaid
Variables Mean Std. Deviation t p-value
/Postpaid
Prepaid 3 0.6364
Quality of information 1.9 0.06
Postpaid 3.2059 0.4314
149
It is evident from table 5.34, that there is no significant difference between
prepaid and postpaid subscribers for communication, openness and speed of
response of Hutch.
Prepaid
Variables Mean Std. Deviation t-value p-value
/Postpaid
Prepaid 2.6784 0.7725
Communication 2.591 0.011*
Postpaid 3.0464 0.6213
Prepaid 2.545 0.9846
Openness 2.161 0.033*
Postpaid 2.9764 0.9388
Speed of Prepaid 2.7986 0.7579
1.702 0.095
response Postpaid 3.0357 0.4663
150
HoA: There is significant difference for communication between prepaid
and postpaid subscribers.
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.36.
Table 5.36: Two way ANOVA Prepaid and Postpaid Subscribers and
Selected Cities
In the above table 5.36 the ANOVA results for communication are
presented for selected cities. It is observed that the variation in the
communication is significant in the selected cities and the interaction between
different selected cities and services is also significant.
151
Table 5.37: Multiple Comparisons (Selected Cities)
Std.
Variables Prepaid/postpaid Mean t-value p-value
Deviation
Prepaid 3.0813 0.6301
Communication 1.652 0.102
Postpaid 3.2826 0.5032
Prepaid 3.1111 0.8756
Openness 1.495 0.138
Postpaid 3.371 0.7283
152
results are significant. Speed of response is more important for the postpaid
subscribers as compared to prepaid subscribers.
Pre- Std.
Variables Mean t-value p-value
pad/Postpaid Deviation
Prepaid 2.4822 0.7573
Communication 4.185 0.001**
Postpaid 3.0939 0.4351
Prepaid 2.2309 0.8494 4.863 0.001**
Openness
Postpaid 2.9771 0.6267
Prepaid 2.793 0.9055 1.795 0.076
Speed of response
Postpaid 3.0568 0.5363
Quality of Prepaid 2.4226 0.8241
5.19 0.001**
information Postpaid 3.2477 0.472
Std.
Variables Prepaid/Postpaid Mean t-value p-value
Deviation
Prepaid 2.7034 0.5757
Communication 2.748 0.007**
Postpaid 3.016 0.5189
Prepaid 2.5577 0.6779
Openness 2.331 0.022*
Postpaid 2.8825 0.6516
Prepaid 2.8358 0.691
Speed of response 1.704 0.092
Postpaid 3.0492 0.518
Quality of Prepaid 2.7476 0.5905
3.048 0.003**
information Postpaid 3.1138 0.5581
153
It is evident from table 5.40, that there is significant difference between
prepaid and postpaid subscribers for communication, openness and quality of
information of Chandigarh city. However, these differences for speed of
response were found to be non-significant. In case of communication, openness
and quality of information the results are highly significant. Communication,
openness and quality of information are more important for the postpaid
subscribers as compared to prepaid subscribers.
In order to test the difference between cities and telecom service provider
and their interaction following hypotheses are specified:
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.41.
154
Table 5.41: Two Way ANOVA for Selected Telecom Provider and
Selected Cities
In the above table 5.41, the ANOVA results for selected telecom service
providers and for selected cities. It is observed that the variation in the
communication is significant in the selected cities and the interaction between
different telecom service providers and selected cities.
155
On the basis of multiple comparisons, communication between selected
TSPs and selected cities has been further analysed by using one-way ANOVA
as below:
Sum of Mean F- p-
Source Of Information df
Squares Square value value
Between
11.288 3 3.763 20.074 0.001
Groups
Communication Within
17.807 95 0.187
Groups
Total 29.095 98
Table 5.43 exhibits that there are significant differences between
Reliance, Airtel, Hutch and Tata Indicom for communication in Ludhiana city.
Scheffe’s Post-Hoc test was carried for multiple comparisons in order to see the
significant differences between the combination of the groups.
95%
Confidence
Mean
Std. p- Interval
Difference
Error value
Dependent (I-J) Lower Upper
(I) TSP (J) TSP
Variable Bound Bound
Reliance .7771(*) 0.1237 0.01 0.4249 1.1292
Tata
Communication Airtel .8434(*) 0.1237 0.01 0.4913 1.1956
Indicom
Hutch .7247(*) 0.1237 0.01 0.3726 1.0769
TSP: Telecom Service Providers
Above table 5.44 explains the results of a Post-Hoc test. It was carried out
to test the significant differences for communication amongst telecom service
providers for Amritsar city. Differences are significant between Reliance and
Tata Indicom, Airtel and Tata Indicom, Hutch and Tata Indicom and Tata Indicom
with other operators. All other combinations of differences were found to be non-
significant.
156
Table 5.45: One-way ANOVA for Amritsar and Selected Telecom Operators
Sum of Mean F- p-
Source Of Variation df
Squares Square value value
Between
Groups 4.045 3 1.348 3.759 0.013
Communication Within
Groups 33.355 93 0.359
Total 37.4 96
95% Confidence
Mean Interval
Std. p-
Difference
Dependent Error value Lower Upper
(I) TSP (J) TSP (I-J)
Variable Bound Bound
Reliance -.5392(*) 0.1694 0.022 -1.0215 .0569
Tata
Airtel -0.1357 0.1751 0.896 -0.6342 .0036
Indicom
Hutch -0.3145 0.1694 0.334 -0.7968 .0167
TSP: Telecom Service Providers
157
Table 5.47 exhibits that there are significant differences between
Reliance, Airtel, Hutch and Tata Indicom for communication in Patiala city.
Scheffe’s Post-Hoc test was carried for multiple comparisons in order to see the
significant differences between the combination of the groups.
95%
Confidence
Mean
Std. p- Interval
Difference
Error value
Dependent (I-J) Lower Upper
(I) TSP (J) TSP
Variable Bound Bound
-
Reliance
-.8005(*) 0.1126 0.01 -1.121 0.4799
Tata - -
Communication Airtel
Indicom -.6046(*) 0.1076 0.01 0.9109 0.2983
-
Hutch
-.6667(*) 0.1076 0.01 -0.973 0.3604
TSP: Telecom Service Providers
Table 5.49: One Way ANOVA: Chandigarh and Selected Telecom Operators
Sum of Mean F- p-
Source Of Variation df
Squares Square value value
Between
3.314 3 1.105 3.869 0.012
Groups
Communication Within
26.845 94 0.286
Groups
Total 30.159 97
Table 5.49 exhibits that there are significant differences between
Reliance, Airtel, Hutch and Tata Indicom for communication in Chandigarh city.
Scheffe’s Post-Hoc test was carried for multiple comparisons in order to see the
significant differences between the combination of the groups.
158
Table 5.50: Multiple Comparisons for Communication between
Telecom Service Providers for Chandigarh City
95% Confidence
Mean Interval
Std. p-
Difference
Dependent (I) Error value Lower Upper
(J) TSP (I-J)
Variable TSP Bound Bound
Communication Hutch Reliance .5065(*) 0.1544 0.017 .06702 0.9461
TSP: Telecom Service Providers
Above table 5.50 shows results of Post-Hoc test. It was carried out to test
the significant differences for communication amongst telecom service providers
for Chandigarh city. Differences are significant between Reliance and Hutch
operators. All other combinations of differences were found to be non-significant.
159
HoA: There is interaction for communication between city and telecom
service providers.
Ho5: There is no interaction for communication between city and prepaid
and postpaid subscribers.
HoA: There is interaction for communication between city and prepaid
and postpaid subscribers.
Ho6: There is no interaction for communication between TSP and
prepaid and postpaid subscribers.
HoA: There is interaction for communication between TSP and prepaid
and postpaid subscribers.
Ho7: There is no interaction for communication among TSP, prepaid and
postpaid subscribers and city.
HoA: There is interaction for communication among TSP, prepaid and
postpaid subscribers and city.
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.51.
Table 5.51: Multi-factor ANOVA for Selected Telecom Provider, Prepaid and
Postpaid and Selected Cities
160
Above table 5.51 exhibits the ANOVA results for communication. They are
presented for selected telecom service provider and prepaid and postpaid
services in selected cities. It is observed that the variation in the communication
is significant in the selected cities and the interaction between different prepaid
and postpaid subscribers of selected telecom service providers and selected
cities.
Std.
Std.
Variable Prepaid/Postpaid Mean Error t-value p-value
Deviation
Mean
Prepaid 2.4023 .4828 .1707
Communication 3.266** 0.003
Postpaid 3.2255 .6285 .1524
** Significant at .01 level
161
Table 5.55: Comparison of Communication and its Dimensions for Tata
Indicom Amritsar
Std.
Std.
Variable Prepaid/Postpaid Mean Error t-value p-value
Deviation
Mean
Prepaid 2.0263 .8876 .2959
Communication 3.177** 0.011
Postpaid 2.997 .3048 .0762
** Significant at .01 level
162
5.4.5.1 Results for Opportunistic Behaviour between Telecom Service
Providers and Prepaid and Postpaid Subscribers
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.58.
Table 5.58: Two-way ANOVA for Prepaid and postpaid subscribers and
Selected Telecom Provider
163
The above table 5.58 shows ANOVA results for opportunistic behavior.
They are presented in the above table selected telecom service provider and
prepaid and postpaid services. It is observed that the variation in the
opportunistic behaviour significant in the prepaid and postpaid services.
Prepaid/ Std.
Variables
Postpaid Mean Deviation t-value p-value
Opportunistic Prepaid 2.6989 0.8825
2.082 0.044*
behavior Postpaid 3.0871 0.6299
Prepaid 2.94 0.939
Regulatory control 0.572 0.569
Postpaid 3.0603 0.8537
Information Prepaid 2.5644 0.8742
2.841 0.007**
asymmetry Postpaid 3.0796 0.5537
Prepaid/ Std.
Variables
Postpaid Mean Deviation t-value p-value
Opportunistic Prepaid 2.7188 0.6681
2.047 0.043*
behavior Postpaid 3.0031 0.6158
Prepaid 2.7759 0.7269
Regulatory control 1.063 0.291
Postpaid 2.9769 0.8946
Information Prepaid 2.7208 0.693
1.95 0.054
asymmetry Postpaid 2.9988 0.6286
164
It is evident from table 5.60, that there is significant difference between
prepaid and postpaid subscribers for opportunistic behaviour of Airtel. However,
these differences for regulatory control and information asymmetry were found to
be non-significant. Opportunistic behaviour is more important for the postpaid
subscribers as compared to prepaid subscribers.
Prepaid/ Std.
Variables
Postpaid Mean Deviation t-value p-value
Prepaid 2.9896 0.517
Opportunistic behavior 0.348 0.729
Postpaid 3.0295 0.544
Prepaid 3.0323 0.5764
Regulatory control 0.547 0.586
Postpaid 2.9559 0.6732
Prepaid 2.9271 0.6574
Information asymmetry 1.408 0.162
Postpaid 3.1032 0.5456
Prepaid/ Std.
Variables
Postpaid Mean Deviation t-value p-value
Opportunistic Prepaid 2.5104 0.9656
2.626 0.01**
behavior Postpaid 3.0466 0.984
Prepaid 2.3333 1.1402
Regulatory control 2.557 0.012*
Postpaid 2.9516 1.1619
Information Prepaid 2.6875
2.491 0.014*
asymmetry Postpaid 3.1488 0.8836
165
information asymmetry are more important for the postpaid subscribers as
compared to prepaid subscribers.
These hypotheses can be tested using two-way ANOVA and the results
are presented in table 5.63.
Table 5.63: Two Way ANOVA for Prepaid and Postpaid Subscribers and
Selected Cities
166
The table 5.63 depicts ANOVA results for opportunistic behavior for
selected cities and prepaid and postpaid services. It is observed that the
variation in the opportunistic behaviour is significant in the prepaid and postpaid
services.
Prepaid/ Std.
Variables
Postpaid Mean Deviation t-value p-value
Opportunistic Prepaid 2.5533 0.8036
4.061 0.001**
behaviour Postpaid 3.165 0.6335
Prepaid 2.5645 0.9725
Regulatory control 2.878 0.005**
Postpaid 3.1371 0.8692
Information Prepaid 2.5421 0.8243
3.956 0.001**
asymmetry Postpaid 3.181 0.5241
** Significant at .01 level
167
It is evident from table 5.65, that there is significant difference between
prepaid and postpaid subscribers for opportunistic behaviour, regulatory control
and information asymmetry of Amritsar city. Opportunistic behaviour, regulatory
control and information asymmetry are more important for the postpaid
subscribers as compared to prepaid subscribers but as for as ethics is
concerned prepaid subscribers are better than postpaid subscribers.
Prepaid/ Std.
Variables
Postpaid Mean Deviation t-value p-value
Opportunistic Prepaid 2.6163 0.7095
2.123 0.036*
behaviour Postpaid 2.9103 0.6259
Prepaid 2.4545 0.8136
Regulatory control 1.726 0.088
Postpaid 2.7589 0.7977
Information Prepaid 2.7565 0.7565
1.65 0.102
asymmetry Postpaid 2.9952 0.6448
* Significant at .05 level
In order to test the difference between cities, TSPs and their interaction
following hypotheses are specified:
168
Ho2: There is no significant difference for opportunistic behaviour
between TSPs.
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.67.
169
Table 5.68: One-way ANOVA for Opportunistic Behaviour Ludhiana and
Selected Telecom Operators
Sum of Mean F- p-
Source Of Information df
Squares Square value value
Between Groups 29.816 3 9.939 27.402 0.01
Opportunistic
Within Groups 34.456 95 0.363
Behaviour
Total 64.272 98
95%
Confidence
Mean
Std. p- Interval
Difference
Error value
Dependent (I-J) Lower Upper
(I) TSP (J) TSP
Variable Bound Bound
Reliance 1.3353(*) 0.1721 0.05 0.8455 1.8252
Opportunistic Tata
Airtel 1.2978(*) 0.1721 0.05 0.808 1.7877
Behaviour Indicom
Hutch 1.1903(*) 0.1721 0.05 0.7005 1.6802
* Significant at .05 level; TSP: Telecom Service Providers
Table 5.69 explains Scheffe’s Post-Hoc results. It was carried out to test
the significant differences for opportunistic behaviour amongst telecom service
providers for Ludhiana city. Differences are significant between Reliance and
Tata Indicom, Airtel and Tata Indicom, Hutch and Tata Indicom. All other
combinations of differences were found to be non-significant.
Table 5.70: One-way ANOVA for Amritsar and Selected Telecom Operators
Sum of Mean F- p-
Source Of Information df
Squares Square value value
Between Groups 5.317 3 1.772 3.431 0.02
Opportunistic
Within Groups 48.038 93 0.517
Behaviour
Total 53.355 96
170
Table 5.70 exhibits that there are significant differences between
Reliance, Airtel, Hutch and Tata Indicom for opportunistic behaviour in Amritsar
city. Scheffe’s Post-Hoc test was carried for multiple comparisons in order to see
the significant differences between the combination of the groups.
95% Confidence
Mean Interval
Std. P-
Difference
Dependent Error value Lower Upper
(I) TSP (J) TSP (I-J)
Variable Bound Bound
Tata
Reliance
Indicom -.6083(*) 0.2033 0.035 -1.1872 -.02952
* Significant at .05 level; TSP: Telecom Service Providers
Table 5.71 explains Scheffe’s Post-Hoc results. It was carried out to test
the significant differences for opportunistic behaviour amongst telecom service
providers for Amritsar city. Differences are significant between Reliance and
Tata Indicom. All other combinations of differences were found to be non-
significant.
Table 5.72: One Way ANOVA for Patiala and Selected Telecom Operators
Sum of Mean F- p-
Source Of Information df
Squares Square value value
Between Groups 17.933 3 5.978 29.678 0.001
Opportunistic
Within Groups 18.53 92 0.201
Behaviour
Total 36.463 95
171
Table 5.73: Multiple Comparison for Opportunistic Behaviour between
Telecom Service Providers for Patiala City
95%
Confidence
Mean Interval
Std. P-
Difference
Error value
Dependent (I-J) Lower Upper
(I) TSP (J) TSP
Variable Bound Bound
Table 5.73 explains Scheffe’s Post-Hoc results. It was carried out to test
the significant differences for opportunistic behaviour amongst telecom service
providers for Patiala city. Differences are significant between Reliance, Airtel and
Tata Indicom, Hutch and Tata Indicom and Tata Indicom with other operators. All
other combinations of differences were found to be non-significant.
Sum of Mean F- p-
Source Of Information df
Squares Square value value
Between Groups 5.391 3 1.797 4.45 0.006
Opportunistic
Within Groups 37.954 94 0.404
Behaviour
Total 43.345 97
Table 5.74 exhibits that there are significant differences between
Reliance, Airtel, Hutch and Tata Indicom for opportunistic behaviour in
Chandigarh city. Scheffe’s Post-Hoc test was carried for multiple comparisons in
order to see the significant differences between the combination of the groups.
172
Table 5.75: Multiple Comparison for Opportunistic Behaviour between
Telecom Service Providers for Chandigarh City
95%
Mean Confidence
Std. P- Interval
Difference
Error value
Dependent (I) (I-J) Lower Upper
(J) TSP
Variable TSP Bound Bound
Reliance .5242(*) 0.1836 0.049 0.0015 1.0468
Opportunistic
Airtel Tata
Behaviour
Indicom .5325(*) 0.1797 0.038 0.0202 1.0441
* Significant at .05 level; TSP: Telecom Service Providers
Table 5.75 explains Scheffe’s Post-Hoc results. It was carried out to test
the significant differences for opportunistic behaviour amongst telecom service
providers for Chandigarh city. Differences are significant between Reliance and
Airtel and Airtel and Tata Indicom. All other combinations of differences were
found to be non-significant.
173
Ho4: There is no interaction for opportunistic behaviour between city and
telecom service providers.
HoA: There is interaction for opportunistic behaviour between city and
telecom service providers.
Ho5: There is no interaction for opportunistic behaviour between city and
prepaid and postpaid subscribers.
HoA: There is interaction for opportunistic behaviour between city and
prepaid and postpaid subscribers.
Ho6: There is no interaction for opportunistic behaviour between TSP
and prepaid and postpaid subscribers.
HoA: There is interaction for opportunistic behaviour between TSP and
prepaid and postpaid subscribers.
Ho7: There is no interaction for opportunistic behaviour among TSP,
prepaid and postpaid subscribers and city.
HoA: There is interaction for opportunistic behaviour among TSP,
prepaid and postpaid subscribers and city.
These hypotheses can be tested using two-way ANOVA and the results
are presented in table 5.76.
Table 5.76: Multiple Factor ANOVA for Telecom Service Providers, Selected
Cities and Prepaid and Postpaid Services
174
The above table 5.76 exhibits ANOVA results for opportunistic behaviour
for prepaid and postpaid services of selected cities and selected telecom service
providers. It is observed that the variation in the opportunistic behaviours
significant in the selected cities and the interaction between selected telecom
service providers and selected cities.
The above table 5.77 explains a post-hoc test for multiple comparisons
among selected cities. It was carried out using Scheffe’s multiple comparisons.
After applying the test, it was observed that there are significant differences
between Ludhiana and other cities and Patiala and Amritsar. But other
differences are not significant amongst other cities.
175
Above table 5.78 indicates t-test results for opportunistic behaviour of
prepaid and postpaid subscribers among all Airtel subscribers of Ludhiana city.
There are significant differences between prepaid(2.58) and postpaid (3.08)
subscribers of Ludhiana Airtel.
176
Table 5.81 indicates t-test results for opportunistic behaviour of prepaid
and postpaid subscribers among all Amritsar Tata Indicom subscribers. There
are significant differences between prepaid (1.88) and postpaid
(2.98)subscribers of Amritsar Tata Indicom.
177
5.4.6.1 Results for Opportunistic Behaviour between Prepaid and Postpaid
Subscribers and Telecom Service Providers (TSPs)
Ho3: There is no interaction for trust between TSPs and prepaid and
postpaid subscribers.
HoA: There is interaction for trust between TSPs and prepaid and
postpaid subscribers.
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.84.
Table 5.84: Two Way ANOVA for Selected Service Provider and Prepaid
and Postpaid Subscribers
178
The above table 5.84 explains ANOVA results for trust for prepaid and
postpaid subscribers of selected telecom service providers. It is observed that
the variation in the trust significant in the prepaid and postpaid subscribers.
179
Table 5.87: Comparison of Trust and its Dimensions for Tata Indicom
Prepaid/ Std.
Variables Mean t-value p-value
Postpaid Deviation
Prepaid 2.8005 0.8921
Trust 1.18 0.241
Postpaid 3.0113 0.8342
Prepaid 2.7341 0.9126
Perceived risk 1.853 0.067
Postpaid 3.0839 0.8983
Technology Prepaid 2.7917 1.3059
0.798 0.427
orientation Postpaid 2.9841 1.0586
Prepaid 2.8757 0.6403
Reputation 0.645 0.52
Postpaid 2.966 0.6864
5.4.6.2 Results for Trust between Selected Cities and Prepaid and
Postpaid Subscribers
Ho1: There is no significant difference for trust between all the four
cities.
HoA: There is significant difference for trust between all the four cities.
Ho3: There is no interaction for trust between cities and prepaid and
postpaid subscribers.
HoA: There is interaction for trust between cities and prepaid and
postpaid subscribers.
180
Table 5.88: Two-way ANOVA for Trust in Selected cities and Prepaid and
Postpaid Subscribers
The above table 5.88 shows ANOVA results for trust for prepaid and
postpaid services of selected cities. It is observed that the variation in the trust is
significant in the selected cities and prepaid and postpaid subscribers. The
interaction between prepaid and postpaid subscribers and selected cities is also
significant.
Trust of prepaid and postpaid subscribers and selected cities has been
further analysed by using a Post-Hoc test. The results of which are given below.
95% Confidence
Mean Interval
Std.
(I) City (J) City Difference p-value
Error Lower Upper
(I-J)
Bound Bound
Amritsar .4187(*) 0.0886 0.05 0.1699 0.6676
Ludhiana Patiala .6250(*) 0.0888 0.05 0.3756 0.8745
Chandigarh .5131(*) 0.0884 0.05 0.265 0.7613
The above table 5.89 explains results for post-hoc test. It was carried out
using Scheffe’s multiple comparisons among selected cities. After applying the
test, it was observed that there are significant differences between Ludhiana and
other cities. But other differences are not significant amongst other cities.
181
On the basis of multiple comparisons, further t-test was carried out. The
results of which are given below:
Table 5.90: Comparison of Trust and its Dimensions for Amritsar City
Prepaid/ Std.
Variables Mean t-value p-value
Postpaid Deviation
Prepaid 2.5155 0.7832
Trust 3.435 0.001**
Postpaid 3.0494 0.5376
Prepaid 2.5538 0.7688 4.085 0.001**
Perceived risk
Postpaid 3.1002 0.5281
182
Table 5.92: Comparison of Trust and its Dimensions for Chandigarh City
Prepaid/
Variables Mean Std. Deviation t-value p-value
Postpaid
Prepaid 2.5762 0.6898
Trust 2.473 0.015
Postpaid 2.9 0.5801
Prepaid 2.6454 0.697
Perceived risk 2.692 0.008**
Postpaid 3.0014 0.5854
a) In order to test the difference between cities, TSPs and their interaction
following hypotheses are specified:
Ho1: There is no significant difference for trust between all the four
cities.
HoA: There is significant difference for trust between all the four cities.
These hypotheses can be tested using two-way ANOVA and the results
are presented in table 5.93.
183
Table 5.93: Two Way ANOVA for Selected Cities and Selected Telecom
Service Providers
The ANOVA results for trust presented in the above table of selected
cities and selected telecom service providers. It is observed that the variation in
the trust is significant in the selected cities and the interaction between selected
telecom service providers and selected cities.
Trust of selected cities and selected telecom service providers has been
further analysed by using one-way ANOVA. The results of which are given
below.
Table 5.94: One Way ANOVA for Ludhiana and Selected Telecom Operators
Sum of Mean
Source of Variation df F-value P-value
Squares Square
Between Groups 23.372 3 7.791 30.822 0.01
Trust Within Groups 24.012 95 0.253
Total 47.384 98
184
Table 5.95: Multiple Comparison for Trust between
Telecom Service Providers for Ludhiana City
95% Confidence
Mean Interval
Std. P-
Difference
Dependent Error value Lower Upper
(I) TSP (J) TSP (I-J)
Variable Bound Bound
Reliance 1.1893(*) 0.1437 0.01 0.7804 1.5982
Tata
Trust Airtel 1.1940(*) 0.1437 0.01 0.7851 1.603
Indicom
Hutch .9407(*) 0.1437 0.01 0.5318 1.3496
TSP: Telecom Service Providers
The above table 5.95 explains Scheffe’s Post-Hoc results. It was carried
out to test the significant differences for trust amongst telecom service providers
for Ludhiana city. Differences are significant between Reliance and Tata
Indicom, Airtel and Tata Indicom, Hutch and Tata Indicom and Tata Indicom with
other operators. All other combinations of differences were found to be non-
significant.
Table 5.96: One Way ANOVA for Amritsar and Selected Telecom 0perators
Sum of Mean
Source of Variation df F-value P-value
Squares Square
Between Groups 5.649 3 1.883 4.663 0.004
Trust Within Groups 37.554 93 0.404
Total 43.202 96
95% Confidence
Mean Interval
Std. P-
Difference
Dependent Error value Lower Upper
(I) TSP (J) TSP (I-J)
Variable Bound Bound
Hutch Reliance -.5895(*) 0.1797 0.017 -1.1012 .0777
Trust Tata
Reliance -.5590(*) 0.1797 0.026 -1.0708 .0472
Indicom
* Significant at .05 level; TSP: Telecom Service Providers
185
The above table 5.97 explains Scheffe’s Post-Hoc results. It was carried
out to test the significant differences for trust amongst telecom service providers
for Amritsar city. Differences are significant between Reliance and Tata Indicom
and Reliance and Hutch. All other combinations of differences were found to be
non-significant.
Table 5.98: One-way ANOVA for Patiala and Selected Telecom 0perators
Sum of Mean
Source of Variation df F-value P-value
Squares Square
Between Groups 11.099 3 3.7 23.008 0.01
Trust Within Groups 14.794 92 0.161
Total 25.893 95
95% Confidence
Mean Interval
Std. P-
Difference
Dependent Error value Lower Upper
(I) TSP (J) TSP (I-J)
Variable Bound Bound
Reliance -.8851(*) 0.1187 0.01 -1.2231 -0.5471
Tata
Trust Airtel -.5825(*) 0.1134 0.01 -0.9056 -0.2595
Indicom
Hutch -.7649(*) 0.1134 0.01 -1.0879 -0.4419
* Significant at .05 level; TSP: Telecom Service Providers
The above table 5.99 explains Scheffe’s Post-Hoc results. It was carried
out to test the significant differences for trust amongst telecom service providers
for Patiala city. Differences are significant between Reliance and Tata Indicom,
Airtel and Tata Indicom, Hutch and Tata Indicom. All other combinations of
differences were found to be non-significant.
186
Table 5.100: One Way ANOVA for Chandigarh and Selected Telecom
0perators
Sum of Mean
Source of Variation df F-value P-value
Squares Square
Between Groups 5.962 3 1.987 5.588 0.001
Trust Within Groups 33.435 94 0.356
Total 39.398 97
95% Confidence
Mean Interval
Std. P-
Difference
Dependent Error Value Lower Upper
(I) TSP (J) TSP (I-J)
Variable Bound Bound
Airtel -.5481(*) 0.1723 0.022 -1.0386 -.0575
Trust Reliance
Hutch -.6562(*) 0.1723 0.004 -1.1468 -0.1657
* Significant at .05 level; TSP: Telecom Service Providers
Scheffe’s Post-Hoc test was carried out to test the significant differences
for trust amongst telecom service providers for Chandigarh city. Differences are
significant between Reliance and Airtel and Reliance and Hutch. All other
combinations of differences were found to be non-significant.
5.4.6.4 Results for Trust between Selected Cities, Prepaid and Postpaid
Subscribers and Telecom Service Providers (TSPs)
Ho1: There is no significant difference for trust between all the four
cities.
HoA: There is significant difference for trust between all the four cities.
187
Ho2: There is no significant difference for trust between telecom service
providers.
Ho4: There is no interaction for trust between city and telecom service
providers.
HoA: There is interaction for trust between city and telecom service
providers.
Ho5: There is no interaction for trust between city and prepaid and
postpaid subscribers.
HoA: There is interaction for trust between city and prepaid and postpaid
subscribers.
Ho6: There is no interaction for trust between TSP and prepaid and
postpaid subscribers.
HoA: There is interaction for trust between TSP and prepaid and
postpaid subscribers.
Ho7: There is no interaction for trust among TSP, prepaid and postpaid
subscribers and city.
HoA: There is interaction for trust among TSP, prepaid and postpaid
subscribers and city.
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.102.
188
Table 5.102: Multiple Factor ANOVA for Selected Cities, Selected Service
Providers and Prepaid and Postpaid Services
The above table 5.102 explains ANOVA results for trust between prepaid
and postpaid services of selected cities and selected telecom service providers.
It is observed that the variation in the trust is significant in the selected cities and
the interaction between selected TSPs and selected cities.
Above table 5.103 indicates t-test results for trust of prepaid and postpaid
subscribers among all Reliance subscribers of Ludhiana city. There are
significant differences between prepaid (2.32) and postpaid(3.15) subscribers of
Ludhiana Reliance.
189
Table 5.104: Comparison of Trust and its Dimensions for Airtel Amritsar
Above table 5.104 indicates t-test results for trust of prepaid and postpaid
subscribers among all Airtel subscribers of Amritsar city. There are significant
differences between prepaid (2.59) and postpaid (3.15) subscribers of Amritsar
Airtel.
Table 5.105: Comparison of Trust and its Dimensions for Hutch Amritsar
Above table 5.105 indicates t-test results for trust of prepaid and postpaid
subscribers among all Hutch Indicom subscribers of Amritsar city. There are
significant differences between prepaid (2.03) and postpaid (2.94) subscribers of
Amritsar Hutch.
190
5.4.7.1 Results for Relationship Commitment between Selected Cities and
Prepaid and Post Paid Subscribers
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.106.
Table 5.106: Two Way ANOVA Prepaid and Postpaid Subscribers and
Selected Cities
Type III Sum of Mean
Source df F-value P-value
Squares Square
Corrected Model 7.701 7 1.1 3.93 0.01
Intercept 2770.245 1 2770.245 9897.358 0.01
TSP 1.244 3 0.415 1.481 0.219
Pr/Po 6.65 1 6.65 23.758 0.01
191
The above table 5.106 explains ANOVA results for relationship
commitment for prepaid and postpaid services. It is observed that the variation in
the relationship commitment is significant.
Prepaid/ Std.
Variables Mean t-value p-value
Postpaid Deviation
Relationship Prepaid 2.6878 0.7158
2.225 0.033*
commitment Postpaid 3.015 0.4219
Degree and Prepaid 2.6543 0.7072
length of 2.542 0.016*
association Postpaid 3.0264 0.4401
Prepaid/ Std.
Variables Mean t-value p-value
Postpaid Deviation
Relationship Prepaid 2.6181 0.5116
3.143 0.002**
commitment Postpaid 2.956 0.4792
Degree and Prepaid 2.6933 0.6362
length of 2.095 0.039*
association Postpaid 2.9567 0.5417
192
commitment and sense of belongingness, results are highly significant as
compared to degree and length of association. Relationship commitment, degree
and length of association and sense of belongingness are more important for the
postpaid subscribers as compared to prepaid subscribers.
Prepaid/ Std.
Variables Mean t-value p-value
Postpaid Deviation
Relationship Prepaid 2.7665 0.5235
2.09 0.042*
commitment Postpaid 2.9805 0.3614
Degree of Prepaid 2.8641 0.5554 1.447 0.155
association Postpaid 3.0184 0.3432
Sense of Prepaid 2.6689 0.5506
2.62 0.01**
belongingness Postpaid 2.9426 0.4549
193
HoA: There is significant difference for relationship commitment between
prepaid and postpaid subscribers.
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.110.
Table: 5.110: Two Way ANOVA for Prepaid and Postpaid Subscribers and
Selected Cities
Type III Sum of Mean
Source df F-value P-value
Squares Square
Corrected Model 24.746 7 3.535 15.025 0.001
Intercept 2780.96 1 2780.96 11819.973 0.001
City 14.962 3 4.987 21.198 0.001
Pr/Po 5.556 1 5.556 23.613 0.001
City* Pr/Po 3.131 3 1.044 4.436 0.004
Error 89.876 382 0.235
Total 3435.921 390
Corrected Total 114.622 389
Pr/Po: Prepaid and Postpaid; TSP: Telecom Service Providers
194
Table 5.111: Multiple Comparisons (Selected Cities)
95% Confidence
Mean Interval
p-
(I) City (J) City Difference Std. Error
value Lower Upper
(I-J)
Bound Bound
Amritsar .2370(*) .0693 0.009 .04252 0.4316
Ludhiana Patiala .5676(*) .0695 0.05 0.3725 0.7627
Chandigarh .2132(*) .0691 0.024 .0191 0.4073
Ludhiana -.2370(*) .0693 0.009 -0.4316 -.0425
Amritsar
Patiala .3306(*) .0698 0.05 0.1345 0.5267
Ludhiana -.5676(*) .0695 0.05 -0.7627 -0.3725
Patiala Amritsar -.3306(*) .0698 0.05 -0.5267 -0.1345
Chandigarh -.3544(*) .0697 0.05 -0.55 -0.1589
Ludhiana -.2132(*) .0691 0.024 -0.4073 -.0191
Chandigarh
Patiala .3544(*) .0697 0.05 0.1589 0.55
The above table 5.111 explains the results of post-hoc test. It was carried
out for multiple comparisons among selected cities using Scheffe’s multiple
comparisons. After applying the test, it was observed that there are significant
differences between Ludhiana and other cities, Amritsar and Patiala, Patiala and
Chandigarh. But other differences are not significant amongst other cities.
Prepaid/ Std.
Variables Mean t-value p-value
Postpaid Deviation
Relationship Prepaid 2.5439 0.5668
5.087 0.001**
commitment Postpaid 3.1164 0.3899
Degree and length Prepaid 2.5532 0.5402
5.996 0.001**
of association Postpaid 3.1508 0.414
Sense of Prepaid 2.5346 0.6546
4.499 0.001**
belongingness Postpaid 3.0821 0.5088
195
It is evident from table 5.112, that there is significant difference between
prepaid and postpaid subscribers for relationship commitment, degree and
length of association and sense of belongingness of Amritsar City. In case of
relationship commitment, degree and length of association and sense of
belongingness are highly significant. Relationship commitment, degree and
length of association and sense of belongingness are more important for the
postpaid subscribers as compared to prepaid subscribers.
Prepaid/ Std.
Variables Mean t-value p-value
Postpaid Deviation
Relationship Prepaid 2.434 0.4823
2.611 0.011*
commitment Postpaid 2.6873 0.4303
Degree and length of Prepaid 2.4781 0.4995
2.081 0.04
association Postpaid 2.6953 0.4732
Sense of Prepaid 2.3825 0.3274
3.652 0.001**
belongingness Postpaid 2.6793 0.4405
196
It is evident from table 5.114, that there is significant difference between
prepaid and postpaid subscribers for sense of belongingness of Chandigarh City.
However, these differences for relationship commitment and degree and length
of association were found to be non-significant. Sense of belongingness is more
important for the postpaid subscribers as compared to prepaid subscribers.
In order to test the difference between cities, TSP and their interaction
following hypotheses are specified:
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.115.
197
Table: 5.115 Two Way ANOVA for Selected Telecom Service Providers and
Selected Cities
Table 5.116: One Way ANOVA: Ludhiana and Selected Telecom 0perators
Sum of Mean F-
Source of Variation df p-value
Squares Square value
Between
14.137 3 4.712 36.995 0.01
Groups
Relationship
Commitment Within Groups 12.101 95 0.127
Total 26.238 98
198
Table 5.117: Multiple Comparison for Relationship Commitment between
Telecom Service Providers for Ludhiana City
95% Confidence
Mean Interval
Std. P-
Difference
Dependent Error value Lower Upper
(I) TSP (J) TSP (I-J)
Variable Bound Bound
Reliance .8955(*) 0.102 0.001 0.6052 1.1858
Tata
Airtel .9530(*) 0.102 0.001 0.6627 1.2433
Indicom
Hutch .7387(*) 0.102 0.001 0.4484 1.029
* Significant at .05 level; TSP: Telecom Service Providers
Table 5.117 exhibits the results of Scheffe’s Post-Hoc test. It was carried
out to test the significant differences for relationship commitment amongst
telecom service providers for Ludhiana city. Differences are significant between
Reliance and Tata Indicom, Airtel and Tata Indicom, Hutch and Tata Indicom. All
other combinations of differences were found to be non-significant.
Table 5.118: One Way ANOVA: Patiala and Selected Telecom 0perators
Sum of Mean F-
Source of Variation Df p-value
Squares Square value
Between
3.916 3 1.305
Groups
Relationship 7.356 .001
Commitment Within Groups 16.328 92 0.177
Total 20.244 95
95% Confidence
Mean
Std. P- Interval
Difference
Dependent Error value Lower Upper
(I) TSP (J) TSP (I-J)
Variable Bound Bound
Airtel .3789(*) 0.1247 0.031 .02382 0.734
Relationship
Reliance Tata
Commitment .5658(*) 0.1247 0.01 0.2106 0.9209
Indicom
* Significant at .05 level; TSP: Telecom Service Providers
199
Above Table 5.119 explains results of Scheffe’s Post-Hoc test. It was
carried out to test the significant differences for relationship commitment
amongst telecom service providers for Patiala city. Differences are significant
between Reliance and Airtel and between Reliance and Tata Indicom. All other
combinations of differences were found to be non-significant.
200
HoA: There is interaction for relationship commitment between TSPs and
prepaid and postpaid subscribers.
These hypotheses can be tested using two-way ANOVA and the results
are presented in Table 5.120.
Table 5.120 presents the ANOVA results for relationship commitment for
prepaid and postpaid services of selected cities and selected telecom service
201
providers. It is observed that the variation in the relationship commitment is
significant in the interaction amongst selected telecom service providers and
selected cities, prepaid & postpaid subscribers and cities. The interaction
amongst city, Telecom service provider and prepaid & post paid subscribers is
also significant one.
202
Above table 5.123 indicates t-test results for relationship commitment of
prepaid and postpaid subscribers among all Hutch subscribers of Amritsar city.
There are significant differences between prepaid (2.43) and postpaid (3.00)
subscribers of Amritsar Hutch.
203
Figure 5.1: Regression Results of Reliance
204
5.4.7.5 Results of Regression Values of Reliance
205
Figure 5.2: Regression Results of Airtel
206
5.4.7.6 Results of Regression Values of Airtel
For Airtel various β-values represent the closeness amongst various
dependent and independent variables. The model diagram represents that in
shared value security, privacy and ethics are highly significant. Privacy (β=.504)
plays more significant role as compared to security (β=.475) and ethics (β=.315).
In opportunistic behavior information asymmetry (β=.705) is comparatively highly
significant as compared to regulatory control (β=.514). Similarly in
communication quality of information (β=.538) plays more important role as
compared to speed of response (β=.406) and openness (β=.406). In trust,
opportunistic behavior (β=.538) plays more important role as compared to
communication (β=.287) and shared value (β=.091). For trust, technology
orientation (β=.481) is highly significant as compared to highly significant values
of perceived risk (β=.375) and reputation (β=.392). Similarly for relationship
commitment trust (β=.446) as compared to shared value (β=.274). For
relationship commitment degree and length of association (β=.579) is more
closely related as compared to sense of belongingness (β=.526).
207
Figure 5.3: Regression Results of Huch
208
5.4.7.7 Results of Regression Values of Hutch
For Hutch various β-values represent the closeness amongst various
dependent and independent variables. The model diagram represents that in
shared value security, privacy and ethics are highly significant. Security (β=.537)
plays more significant role as compared to privacy (β=.472) and ethics (β=.361).
In opportunistic behavior information asymmetry (β=.604) is comparatively highly
significant as compared to regulatory control (β=.551). Similarly in
communication openness (β=.449) plays more important role as compared to
speed of response (β=.379) and quality of information (β=.354). In trust,
opportunistic behavior (β=.434) plays more important role as compared to
communication (β=.207) and shared value (β=.159). For trust, technology
orientation (β=.463) is highly significant as compared to perceived risk (β=.331)
and reputation (β=.321). Similarly for relationship commitment trust (β=.497) is
highly significant as compared to shared value (β=.160). For relationship
commitment, sense of belongingness is highly significant (β=.584) as compared
to degree and length of association (β=.496).
209
Figure 5.4: Regression Results of Tata Indicom
210
5.4.7.8 Results of Regression Values of Tata Indicom
For Tata Indicom various β-values represent the closeness amongst
various dependent and independent variables. The model diagram represents
that in shared value security, privacy and ethics are highly significant. Security
(β=.403) plays more significant role as compared to privacy (β=.379) and ethics
(β=.327). In opportunistic behavior regulatory control (β=.587) is comparatively
highly significant as compared to information asymmetry (β=.452). Similarly in
communication, openness (β=.464) plays more important role as compared to
speed of response (β=.284) and quality of information (β=.338). In trust,
opportunistic behavior is highly significant (β=.523) plays more important role as
compared to communication (β=.255) and shared value (β=.179). For trust,
technology orientation (β=.448) is highly significant as compared to perceived
risk (β=.356) and reputation (β=.260). Similarly for relationship commitment
shared value (β=.475) is highly significant as compared to trust (β=.403). For
relationship commitment, sense of belongingness (β=.552) is highly significant
as compared to degree and length of association (β=.508).
211
Figure 5.5: Regression Results of Prepaid Subscribers
212
5.4.7.9 Results of Regression Values of Prepaid Subscribers
For prepaid subscribers various β-values represent the closeness
amongst various dependent and independent variables. The model diagram
represents that in shared value security, privacy and ethics are highly significant.
Security (β=.447) plays more significant role as compared to privacy (β=.398)
and ethics (β=.323). In opportunistic behavior, regulatory control (β=.598) is
comparatively highly significant as compared to information asymmetry (β=.496).
Similarly in communication, openness (β=.416) plays more important role as
compared to quality of information (β=.366) and speed of response (β=.362). In
trust, opportunistic behavior is highly significant (β=.433) plays more important
role as compared to communication (β=.312) and shared value (β=.147). For
trust, technology orientation (β=.483) is highly significant as compared to
perceived risk (β=.327) and reputation (β=.288). Similarly for relationship
commitment shared value (β=.461) is highly significant as compared to trust
(β=.279). For relationship commitment, degree and length of association
(β=.544) is highly significant as compared to sense of belongingness (β=.532).
213
Figure 5.6: Regression Results of Postpaid Subscribers
214
5.4.7.10 Results of Regression Values of Postpaid Subscribers
For postpaid subscribers various β-values represent the closeness
amongst various dependent and independent variables. The model diagram
represents that in shared value security, privacy and ethics are highly significant.
Security (β=.450) plays more significant role as compared to privacy (β=.440)
and ethics (β=.320). In opportunistic behavior, regulatory control (β=.634) is
comparatively highly significant as compared to information asymmetry (β=.469).
Similarly in communication, openness (β=.457) plays more important role as
compared to quality of information (β=.340) and speed of response (β=.336). In
trust, communication (β=.432) is highly significant plays more important role as
compared to opportunistic behavior (β=.308) and shared value (β=.210). For
trust, technology orientation (β=.442) is highly significant as compared to
perceived risk (β=.360) and reputation (β=.327). Similarly for relationship
commitment trust (β=.555) is highly significant as compared to shared value
(β=.233). For relationship commitment, degree and length of association
(β=.558) is highly significant as compared to sense of belongingness (β=.521).
215
Figure 5.7: Regression Results of Combined Prepaid and Postpaid Subscribers
216
5.4.7.11 Results of Regression Values of Combined Prepaid and Postpaid
Subscribers
For overall β-values of selected telecom service providers in selected city
represent the closeness amongst various dependent and independent variables.
The model diagram represents that in shared value security, privacy and ethics
are highly significant. Security (β=.445) plays more significant role as compared
to privacy (β=.419) and ethics (β=.322). In opportunistic behavior, regulatory
control (β=.617) is comparatively highly significant as compared to information
asymmetry (β=.481). Similarly in communication, openness (β=.440) plays more
important role as compared to quality of information (β=.349) and speed of
response (β=.341). In opportunistic behavior (β=.436) is highly significant plays
more important role as compared to communication (β=.305) and shared value
(β=.188). For trust, technology orientation (β=.454) is highly significant as
compared to perceived risk (β=.349) and reputation (β=.312). Similarly for
relationship commitment trust (β=.437) is highly significant as compared to
shared value (β=.344). For relationship commitment, sense of belongingness
(β=.549) is highly significant as compared to degree and length of association
(β=.535).
217
Table 5.125: Effectiveness of Source of Information between Prepaid and
Postpaid Subscribers
PLACE
Total
Ludhiana Amritsar Patiala Chandigarh p-value
Advertisements Yes 72 57 24 43 196 <0.001**
(Media): source
of information
No 27 41 74 54 196
of Mobile
Services
Word Of mouth: Yes 63 47 71 49 230 <0.001**
source of
information of No 36 51 27 48 162
Mobile Services
Company Outlet Yes 56 19 8 7 90
source of
<0.001**
information of No 43 79 90 90 302
Mobile Services
Internet: source Yes 1 3 1 2 7
of information
0.655
of Mobile No 98 95 97 95 385
Services
Chi-square for advertisement=15.97, word of mouth=89.60,
* Significant at .05 level; ** Significant at .01 level
On pursing above table 5.125, it is evident that results are highly
significant for advertisements as medium of information (<0.001), word of mouth
(<0.001) and company outlet (<0.001) between prepaid and postpaid
subscribers. The results for internet as source of information of mobile services
has been found non-significant.
218
The above table 5.126 explains people’s preference for the subscription of
other services along with mobile services of various mobile operators. Highly
significant results are obtained for subscription of other services of Reliance
(0.001) and Airtel (0.001) amongst various cities covering Ludhiana, Amritsar,
Patiala and Chandigarh. For Hutch and Tata Indicom the results are found to be
non-significant for the subscription of other services along with the mobile one.
It is evident from the above table 5.127 that significant differences are
found between prepaid and postpaid subscribers (0.001) amongst selected four
cities- Ludhiana, Amritsar, Patiala and Chandigarh.
219
On pursing table 5.128, it is evident that the results are significant for all
the four operators namely Reliance, Airtel, Hutch and Tata Indicom regarding the
purpose of usage of mobile phones. Significant differences are found between
prepaid and postpaid users who consider mobile usage as advantageous over
the landline (.0014) and mobile usage makes easily accessible (0.036). For the
rest of purposes, no significant differences are found among prepaid and
postpaid operators.
5
4.5
4
3.5
Mean Scores
3
2.5
2
1.5
1
0.5
0
1 2 3 4 5 6 7 8
Above figure 5.8 mobile phones are used for used by subscribers for
different purposes of selected mobile service provided. In the above graph,
different purposes are taken on x-axis and mean scores of selected telecom
service providers on y-axis. For the purpose to stay in touch, there are not
significant differences between Reliance and Tata Indicom. But there are
significant differences between Reliance and Airtel and Reliance and Hutch.
Being professional requirement, there are significant differences among Tata
Indicom and Reliance, Airtel and Tata Indicom. In context of status symbol, there
220
are significant differences between Reliance, Tata Indicom and Airtel and Hutch.
Having advantage over the landline is another purpose where Reliance and Tata
Indicom has highest scores. Since mobile usage enhances your mobility, the
significant mean scores of Tata Indicom.
S. Std.
Statements Services N Mean t-value p-value
No. Deviation
Short Message Prepaid 122 4.07 1.12 1.371 0.171
1
Services (SMS) Postpaid 263 3.89 1.16
Multi Media Prepaid 120 2.22 1.21 0.306 0.76
2 Message Services
(MMS) Postpaid 253 2.26 1.18
Prepaid 120 2.33 1.39 0.653 0.514
3 GPRS / Internet
Postpaid 245 2.23 1.3
Call Diverting Prepaid 119 2.26 1.32 0.11 0.912
Feature (Call
4
Forwarding / Call Postpaid 246 2.28 1.28
Diverting )
Information based Prepaid 118 2.24 1.2 0.422 0.673
5
services Postpaid 240 2.3 1.25
Getting News Prepaid 118 2.35 1.25 0.631 0.528
6 Update (Sports /
Others ) Postpaid 239 2.26 1.15
Prepaid 118 3.63 1.04 0.165 0.869
7 For STD calling
Postpaid 257 3.65 1.01
Prepaid 122 4.4 0.8 0.421 0.674
8 For Local calling
Postpaid 263 4.44 0.88
Telecom operators are providing various mobile services covering short
message service, multi-media service, GPRS, internet, call diverting features,
information based services, getting news update etc. No significant differences
are found between prepaid and postpaid subscribers regarding the availing of
various services. It implies that both types of subscribers are using mobile
phones to avail almost same kind of services. Results of each operator for
various purposes are shown in following figure 5.9.
221
Figure 5.9: Different Mobile Services between Prepaid and Postpaid
Subscribers
5
4.5
4
3.5
3
Mean Scores 2.5
2
1.5
1
0.5
0
1 2 3 4 5 6 7 8
The above figure 5.9 shows the significant differences between the
means of various types of services of selected telecom service provider. With
regard to usage of SMS services, there are significant differences between Tata
Indicom and Airtel. Whereas Reliance has got maximum mean score for multi-
media message services. Reliance and Tata Indicom have almost same mean
score for GPRS/internet. For call diverting feature, there are significant
differences between the mean scores of Reliance and Airtel. Reliance has
maximum mean score value for information- based services as compare to Tata
Indicom. For getting news update, Reliance has got significant mean scores
followed by Tata Indicom, Hutch and Airtel. For STD calling, there are significant
differences between the means of Reliance and Tata Indicom. For local calling,
there are not significant differences between the means of selected operators.
222
Table 5.130: Evaluation of Executive’s Knowledge About the Product
223
S. Prepaid/ Std.
Parameters N Mean t-value p-value
No. Postpaid Deviation
Prepaid 121 3.98 0.84 0.1 0.921
14 Voice clarity
Postpaid 257 3.98 0.84
Prepaid 117 3.79 1.04 2.124 0.035*
15 Transparency in billing
Postpaid 255 4.02 0.78
Prepaid 119 3.44 0.89 2.033 0.043*
16 Dealer services
Postpaid 253 3.64 0.9
Prepaid 118 3.22 1.09 3.209 0.002**
17 Word of Mouth
Postpaid 246 3.59 0.83
Prepaid 119 3.36 0.99 0.708 0.479
18 Friends’ advice
Postpaid 258 3.44 1.04
*significant at .01 level
**Significant at .05 level
As can be seen from the above table 5.131, the purchase decision is
influenced by various factors- Brand Image, network Connectivity, coverage, call
tariff, service quality, reliability, advertisement, sales promotion, value added
services, ease of availability and recharge customer care services, roaming
facility, and discount, Voice clarity Transparency in billing, dealer services, and
word of Mouth.
• Highly significant results can be seen for word of mouth (0.002) between
prepaid (3.22) and postpaid (3.59) subscribers.
224
Figure 5.10: Considerations Prior to Purchase Decision for a Mobile
Service Provider
4.5
Mean Scores
3.5
2.5
11
13
15
17
1
The above figure 5.10 explains the significant mean scores for the option
of selection of mobile service provider. Following are the results of various
parameters.
• For network connectivity, Hutch and Tata Indicom have significant mean
scores as compare to Airtel and Reliance.
• For coverage, Hutch, Reliance and Tata Indicom have maximum values
of mean as compare to Airtel.
• For call tariff, Tata Indicom has significant maximum mean value and
Reliance being the minimum one.
• For service quality and reliability parameter, Tata Indicom has the
significant mean value as compare to the minimum value of Airtel.
• For Advertisement and sales promotion, Reliance and Tata Indicom has
maximum mean values as compared to Airtel.
225
• For value added services, ease of availability and recharge facility. Tata
Indicom, Hutch and Reliance have significant mean values as compare to
Airtel.
• For customer care services, Tata Indicom has maximum mean values as
compare to Airtel.
• For rebate and discount, Tata Indicom has the maximum mean score and
Airtel has the least one.
• For voice and clarity, there are significant differences between mean
scores of Tata Indicom being maximum and Airtel as the least ones.
• For dealer services, Reliance and Hutch has higher mean values in
relation to Airtel.
• For friend’s advice, Hutch has highest mean score as compare to Airtel
being the minimum one.
The above table 5.132 indicates that there are significant differences.
relating to information about awareness of company’s offices between those who
agree and who do not agree amongst selected four cities is significant at 99%
level.
226
Table 5.133: Response About Service Providers’ Touch Points
S. Prepaid/ Std.
Statements N Mean t p-value
No. Postpaid Deviation
Ambience of the company Prepaid 102 3.42 0.87
1 1.441 0.15
outlet Postpaid 211 3.56 0.79
Availability of Literatures/ Prepaid 103 3.39 1.02
2 0.797 0.426
Brochures Postpaid 222 3.48 0.9
Inter-personal skills of the Prepaid 106 3.63 1.01
3 0.68 0.497
Executive at company outlet Postpaid 227 3.56 0.86
Handling Product related Prepaid 105 3.59 1.02
4 0.386 0.7
Queries Postpaid 229 3.63 0.9
Complaint Handling at Prepaid 109 3.7 0.97
5 0.522 0.602
company outlet Postpaid 236 3.64 0.94
Overall Rating of company Prepaid 106 3.58 0.98
6 0.05 0.961
outlet Postpaid 235 3.57 0.88
Further, for each operator the differences between mean scores for
response about service providers’ touch points are explained in the following
figure 5.11.
4.5
4
Mean Scores
3.5
2.5
2
1 2 3 4 5 6
227
The above figure 5.11 explains the evaluation of service providers’ touch
points for individual operator.
Reliance has been assigned significant mean scores and Airtel the
minimum one for ambience of company outlet, availability of literature/brochures,
inter-personals bills of the executive at company outlet, handling product related
queries, complaints handling at company outlet. For overall rating of company
outlet, Reliance and Hutch are followed by Tata Indicom and Airtel.
S. Std.
Statements A2.2 N Mean T p-value
No. Deviation
1 Easily Accessible Prepaid 122 3.49 1.16
1.593 0.112
Postpaid 261 3.68 1.02
2 Humble and Soft Prepaid 122 3.71 0.99
Spoken 0.902 0.368
Postpaid 261 3.81 1.01
3 Ability for Complete Prepaid 121 3.51 1.16
1.354 0.177
Resolution Postpaid 261 3.67 1.05
4 Customer Care Prepaid 120 3.5 1.01
Services 1.045 0.297
Postpaid 254 3.61 0.97
The table 5.134 explains the results of customer care services. They are
evaluated on the grounds of easily accessibility, humble and soft- spoken
executive, ability to resolve the problem and customer care services. No
significant differences are found for both prepaid and postpaid services .It
implies that these are equally important for both kinds of subscribers.
Further, for each operator customer care services are studied in the
following figure 5.12.
228
Figure 5.12
4
3.9
3.8
3.7
Mean Scores
3.6
3.5
3.4
3.3
3.2
3.1
3
1 2 3 4
The above figure 5.12 explains the significant results with regard to
customer care services regarding the accessibility of the executive Tata Indicom
had maximum mean scores as compared to Airtel. Secondly, in relation to
humble and softness of executive Hutch has maximum mean score as compared
to Airtel. For providing the complete resolution, Hutch has maximum mean score
as compared to other operators.
Table 5.135 explains the results regarding the handling of query solution
and its efficient solutions. The results are highly significant. The above table
explains the highly significant values (<0.001) between ‘yes’ and ‘no’
respondents amongst different selected cities covering Chandigarh, Ludhiana,
Amritsar and Patiala.
229
Table 5.136: Effectiveness of After-Sales Services
The above table 5.136 indicates the highly significant results between the
‘yes ‘respondents and ‘no’ respondents. There are highly significant results for
warranty claimed (0.001), awareness about handset service centers (<0.001),
visit to service centres and promptness in problem-solving (<0.001) amongst
selected cities covering Chandigarh, Ludhiana, Amritsar and Patiala.
The above table 5.137 explains the results with regard to the evaluation of
overall service quality. The differences are not significant one between the
prepaid and post paid subscriber of selected telecom service providers.
230
Figure 5.13: Evaluation of Service Quality
3.8 3.73
3.7
3.3
3.2
3.1
Reliance Airtel Hutch Tata Indicom
The above figure 5.13 explains the overall rating of after sale services of
all the selected four operators. Reliance has maximum mean score (3.73)
followed by Airtel (3.44), Tata Indicom (3.33) and Hutch (3.31). In relation to
evaluation of overall evaluation of service quality, significant differences are not
found between both prepaid and postpaid subscribers.
Prepaid/ Std.
S. No. Parameters N Mean t p-value
Postpaid Deviation
Prepaid 122 3.57 1 0.592 0.555
1 Tariff / Price / Call rate
Postpaid 258 3.63 0.86
Prepaid 120 3.71 0.89 1.519 0.13
2 Network Connectivity
Postpaid 264 3.85 0.7
Prepaid 124 3.8 0.92 1.309 0.192
3 Coverage
Postpaid 260 3.92 0.67
Prepaid 117 3.74 0.76 0.451 0.652
4 Value Added Service
Postpaid 253 3.7 0.68
Prepaid 119 3.47 0.99 1.593 0.112
5 Roaming facility
Postpaid 262 3.64 0.93
Prepaid 117 3.53 0.9 0.129 0.897
6 Transparency I n Billing
Postpaid 251 3.52 0.8
Ease of Availability / Prepaid 116 3.94 0.76 2.26 0.024*
7
Recharge Postpaid 247 3.76 0.7
Prepaid 119 3.39 0.94 1.498 0.135
8 Customer Care Services
Postpaid 256 3.54 0.87
231
Prepaid/ Std.
S. No. Parameters N Mean t p-value
Postpaid Deviation
Prepaid 117 3.37 0.85 0.164 0.87
9 Sales Promotion Offers
Postpaid 253 3.38 0.88
Prepaid 120 3.3 0.98 0.07 0.944
10 Advertisement
Postpaid 257 3.31 0.94
Prepaid 120 3.52 1.02 0.959 0.339
11 Voice Clarity
Postpaid 257 3.62 0.82
Prepaid 118 3.47 0.87 0.598 0.55
12 Dealer Network
Postpaid 245 3.53 0.82
Prepaid 93 3.75 0.76 0.829 0.408
13 Overall Satisfaction Level
Postpaid 191 3.83 0.6
Prepaid 121 2.88 1.03 4.011 0.001**
14 Continuation of Services
Postpaid 256 2.48 0.84
* significant at .01 level
**Significant at .05 level
In the above table 5.138, the satisfaction level of network quality has been
evaluated on the basis of tariff /call rate, network connectivity, coverage, value
added services, roaming facility, transparency in billing, customer care services,
sales promotion, advertisement, voice clarity, dealer network, overall satisfaction
level and continuation of services. Ease of availability and recharge facility
(0.024) has shown significant differences between prepaid (3.94) and postpaid
subscribers (3.76). There are highly significant results for continuation of
services (0.001) between prepaid (2.88) and postpaid (2.48) services.
4.5
4
Mean Scores
3.5
2.5
2
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
232
The above figure 5.14 explains the significant results for the satisfaction
level of network quality of selected service provider.
• For value added service, Reliance has maximum mean score as compare
to Hutch.
• For customer care services, Tata Indicom has significant mean score as
compare to Airtel.
233
The above table 5.139 evaluates correlation between pre-purchase and
post-purchase behaviour of subscribers. Amongst various parameters, there is
high correlation in ease of availability and recharge (.361) factor for pre-purchase
and post-purchase.
i) Age
Age wise
110
120 97
100
Frequency
80
52 50 42
60
40 19
2 8
20
0
Age <18 Age 18-25 Age 25-40 Age 40+
Prepaid Postpaid
234
In figure 5.15, for below 18 years category, there are only 2 prepaid
subscribers as compare to 8 postpaid subscribers. Whereas maximum number
of postpaid subscribers are in the age group of 25-40 years.
Student 3 14 30 33 80
Government.
3 3 0 2 8
Employee
Private
16 22 11 18 67
Occupation employee
Professional 21 7 16 9 53
Self-
26 34 28 26 114
employed
Others 12 12 5 6 35
Total 81 92 90 94 357
Occupation
100
81
80
Frequency
60 53
46
33 33
40 27 24
21 20
20 6 11
2
0
1 2 3 4 5 6
Prepaid Postpaid
235
Whereas the figure 5.16 explains the occupation composition between
prepaid and post paid subscribers. It represents that self-employed are more into
postpaid (81) as compare to prepaid (33), and least number is of government
employee for both postpaid (6) and prepaid (2).
Male 72 79 58 68 277
Gender
Female 16 15 40 27 98
Total 88 94 98 95 375
Genderwise
195
200
Frequency
150
82
59
100 39
50
0
1 2
Male Female
Above figure 5.17 explains that more males are using in both prepaid and
postpaid categories as compare to females.
236
Table 5.143: Education-Wise Composition of Subscribers Amongst
Selected Cities
Service Provider
Total
Reliance Airtel Hutch Tata Indicom
Metric 3 0 3 3 9
Education
10+2 8 8 27 25 68
Graduate 48 58 45 66 217
Postgraduate 30 25 24 4 83
Total 89 91 99 98 377
Service Provider
Total
Reliance Airtel Hutch Tata Indicom
<5000 9 10 18 31 68
Income
5000-10000 20 20 27 13 80
10000-20000 23 30 21 36 110
20000+ 12 20 14 5 51
Total 64 80 80 85 309
The above tables 5.143, 5.144 related to education and income reflect the
significant results of various mobile subscribers. Maximum graduates (217) are
using mobile phone followed by postgraduate (83), 10+2 (68) and metric group
(9). Following figure 5.18 explains income –wise composition of prepaid and post
paid subscribers of mobile usage.
Figure 5.18: Income-Wise Composition of Prepaid and Postpaid
Subscribers
Incomewise
80 75
60 51
Frequency
46
40 35 37
29
22
20 14
0
<5000 5000-10000 10000-20000 20000+
Prepaid Postpaid
237
Whereas in income profile, most of the users are in income group of
10,000-20,000 (110) as compare to other income classes. On the same
direction, the results between prepaid and postpaid subscribers can be seen.
Maximum number of postpaid subscribers are in income group of 10,000 –
20,000 and least in for prepaid (14) in the 20,000 and above income group.
Service Provider
Total
Reliance Airtel Hutch Tata Indicom
<1 year 7 6 11 13 37
Experience
1-2 year 21 24 29 22 96
>2 year 61 63 60 63 247
Total 89 93 100 98 380
Experience
200 170
150
Frequency
100 77
66
50 20 30
17
0
<1 year 1-2 year >2 year
Prepaid Postpaid
The figure 5.19 explains the ratio between prepaid and postpaid
subscribers is almost same for the subscribers with less than one year
238
experience. Most of the subscribers for both prepaid and postpaid category are
falling in the category with experience of more than two years.
Table 5.146: Time-Spent on Mobile-Usage of Subscribers Amongst
Selected Cities
Service Provider
Total
Reliance Airtel Hutch Tata Indicom
< 10 min 6 19 17 23 65
Time
10-20 min 21 21 11 24 77
>20 min 62 54 71 51 238
Total 89 94 99 98 380
The table 5.146 explains the time spent on usage of mobile during the
day. Most of the subscribers (238) are using mobile phones for more than 20
minutes. Around 65 customers are spending less than 10 minutes on usage.
Following figure 5.20 explains the time spent on for mobile usage single call
duration.
Time
200
163
150
Frequency
100 75
53
41
50 24 24
0
< 10 min 10-20 min >20 min
Prepaid Postpaid
239
subscribers. In more than 20 minutes categories, 163 postpaid subscribers are
using mobile phones as compare to 75 prepaid subscribers.
Service Provider
Total
Reliance Airtel Hutch Tata Indicom
Yes 60 66 84 94 304
Domestic
No 29 27 16 4 76
National Yes 62 58 43 32 195
No 27 35 57 66 185
International Yes 11 6 8 10 35
No 78 87 91 88 344
The above table 5.147 explains the results with regard to places where
calls are generally made. 75% of the respondents use mobile phones for making
local calls. 195 subscribers use mobile phones for making national calls and
around 10% are using mobile phones for making international calls.
(PART-B)
Reliability Coefficients
Number of Cases = 22.0 N of Items = 55
Alpha = .8535
Operator Yes No
Reliance 16 24
Airtel 37 3
Hutch 12 28
Tata Indicom 23 17
240
Figure 5.21: Dealership of Telecom Operators
40 37
35
30 28
24 23
25
Frequency
20 16 17
15 12
10
5 3
0
Reliance Airtel Hutch Tata Indicom
Yes No
The above table 5.148 and figure 5.21, explains the results of dealers’
preference for services for various telecom service providers. Out of the total
sample size of 40, most of the dealers (37) preferred the dealership of Airtel as
compare to Tata Indicom (23), Reliance (16) and Hutch (12).
40 38 39
36
35
31
30 28
Frequency
25 23
21
20 19
17
15 12
10 9
5 4
2 1
0
t
ed
t
e
s
n
t
en
un
e
ic
er
io
rg
er
v
em
th
ct
co
Ta
er
ov
fa
O
is
S
tis
C
tis
s
D
er
le
er
a
Sa
m
Sa
re
dv
to
A
us
C
Yes No
241
Table 5.149: Evaluation of Company’s Directions with to Dealers
Areas Yes No
Sales target 28 12
Customer service 17 23
Discount/Schemes 19 21
Consumer Satisfaction 9 31
Areas to be covered 2 38
Advertisement Planning 4 36
In the above figure 5.22 and table 5.149, various areas in which dealer’s
get directions from companies have been explained. Most of the telecom service
providers are focused on sales target (28), discount and schemes (19),customer
services (17). Lesser weightage is given to other areas like consumer
satisfaction (9), areas to be covered (2), advertisement planning (4).
15
16
14
11
12 10
10
Frequency
8
6
4
2
0
Regularly Sometimes Occasionally
242
The above figure 5.23 explains dealers’ participation in marketing
decision. Most of the dealers (15) agreed that they participate in marketing
decisions sometimes followed by occasionally (1) and regularly (10).
Above table 5.150 explain results with regard to evaluation of dealers for
best channel margins and best channel penetration. For best channel margins
and best channel penetration, Airtel and Hutch are preferred telecom service
providers as compare to Reliance and Tata Indicom. In context of best channel
delivery and best channel support, Airtel and Tata Indicom have shown
significant results as compare to Hutch and Reliance. For best quality of the
product results are more significant for Airtel, Tata Indicom and Reliance as
compare to Hutch.
243
The above table 5.151 explains various product attributes and their
correlation. There is highly significant correlation between Product features and
product quality, product range and product features, low price and product
features, premium price and product features and customer service and product
features. Results are highly significant for product quality and product range, low
price and product quality, premium price and product quality and low price and
advertisement. Correlations are significant for advertisement and product
features, product range and premium price and for premium price and customer
service.
18
17
18
16 14
13
14
12
Frequency
10
8
6
4
2
0
Yes No
The above figure 5.24 explains dealer’s opinion that feedback from the
customer after the sale of product is important one and most of them agree that
this feedback is forwarded to company.
244
Figure 5.25: Effectiveness of Product Strategy
40
40
35 33 34
30 27
25
25
Frequency
20
15
15 13
10 7 6
5
0
0
Quality Range Features Brand Any
Image Other
Yes No
.
The above figure 5.25 explains various aspects of product strategy in the
current market scenario. Quality of the product (25) has significant role to play as
compare to any other aspect for product strategy.
40
40 37
35
35
30 26
Frequency
25
20
15 14
10
5
5 3
0
0
Price Cuts Cost Cuts Payment Any Other
Terms
Yes No
In figure 5.26 various aspects of price strategy are taken into account.
Price cuts (26) play most significant role of price strategy as compare to cost
cuts (5), payment and credit terms (3).
245
Table 5.152: Evaluation of Promotional Strategy
Yes No
Advertisements 14 26
Discounts and schemes 14 26
Dealer incentives 14 26
Any other 0 40
40 38
35
31
30
25 25
Frequency
25 24 23
20 2020
16 17
15 15 15
10 9
5 2
0
e
ty
n
ity
t
t
s
en
di
c
er
gi
ui
an
iv
re
ar
th
m
tin
us
C
w
op
M
O
on
llo
cl
el
Ex
A
ev
D
Yes No
.
The above graph explains the dealer’s response for the satisfaction of
compensation the company for seller support. Various parameters for dealers’
satisfaction studied are gross margin and overhead contribution, Promotional
allowance and below-the line benefits, Distribution Exclusivity, Continuity of
Supply, Market Development and credit. Continuity of supply (20) distribution
exclusively (15), promotional allowance (17), gross margins (16) and market
developments have more significance as compare to credit and other support
aspects.
246
(PART C)
The data for telecom service providers has been collected from the
executives at the touch points, officials dealing with customers care service.
Data was collected from the head office, web world offices and touch points.
4%
24%
44%
28%
247
i) Voice mail service: Call waiting, call hold, call divert, call line identification
and presentation, international SMS, Net connect and call identification
and restriction. The results are almost same for each operator as each of
them is providing this service.
27%
31%
9%
33%
iii) Call line identification and Restriction: Figure explains that Tata Indicom
has significant value (33%) as compare to Hutch (9%) amongst all
operators.
248
Table 5.154: Export of Services
Telecom Service Operators Yes No Total
Reliance 7 5 12
Airtel 0 14 14
Hutch 0 15 15
Tata Indicom 2 9 11
Total 9 43 52
The above tables 5.154 and 5.155 explain the exporter services and
localization aspect of products and services according to Indian conditions. None
of the telecom service operator is into major export of services. Whereas for
localization of products and services, Hutch and Reliance have significant results
as compare to Airtel and Tata Indicom.
249
• With regard to television as medium of advertisement Reliance and Hutch
have significant results followed by Tata Indicom and Airtel.
• For the print ads, Reliance and Tata Indicom have shown maximum
values.
• For market survey and research, Tata Indicom, Reliance and Hutch are
with the maximum values.
Association Dealer/
Telecom Service Direct Company
Internet with other distributor
Operators Marketing Outlets
companies
Reliance 6 12 0 0 9
Airtel 6 4 0 0 12
Hutch 7 7 6 2 7
Tata Indicom 8 3 0 0 7
250
The table 5.158 explains results for pre and post sales services. Reliance,
Tata Indicom and Hutch have significant values as compare to Airtel for pre and
post sales services.
The table 5.159 shows the results for the availability of after sales service
stations. Reliance, Tata Indicom and Hutch have shown significant results as
compare to Airtel.
The above table 5.160 indicates the results for the allocation amount for
after-sales service charges. Tata Indicom is investing significant amounts for
providing after sales service as:
Tata Indicom, Reliance and Hutch are using internet as medium for
feedback to the maximum s compare to Airtel.
251
Table 5.161: Customer Care and After-Sale Services
Telecom Service Total
Yes No
Operator
Reliance 10 5 15
Airtel 6 9 15
Hutch 13 2 15
Tata Indicom 15 0 15
The table 5.161 explains the role of service stations in terms of customer
service and customer relations. Hutch and Tata Indicom have shown significant
results for customer care services as compare to other operators.
The table 5.163 explains the company’s policy of customer feedback after
the sale of the services. Hutch and Tata Indicom take regularly feedback from
customers after sales service of the mobile services as compare to other
operators.
252
Table 5.164: Feedback Channels of Telecom Service Providers
The table 5.165 indicates the results of usage of Indian technology vis-à-
vis foreign technology. Significant results are shown for Reliance, Hutch and
Tata Indicom. These telecom service operators employing both foreign and
Indian technology.
253
Figure 5.30: Methods of marketing of products
16 15
14 13
12
12
10
Frequency 10
8
6 5
4 3
2
2
0
0
Reliance Airtel Hutch Tata Indicom
Yes No
The figure 5.30 reflects the various methods of marketing of products. The
results that Tata Indicom, Hutch and Reliance use sales personnel as medium of
marketing in relation to other sources.
254
Table 5.167: Areas of Marketing Strategy
This research tests the impact of key antecedent factors, which influence
consumer trust in mobile usage of various telecom service providers, which in
turn affects relationship commitment. The model results and hypothesis tests are
furnished below.
Some of the key findings from the data analysis are highlighted below:
255
• Opportunistic behavior tends to have a critical impact on trust. Thus, H5 is
established. Regulatory control and information asymmetry plays a
significant role in controlling opportunistic behavior.
256
CHAPTER – 6
6.1 INTRODUCTION
It is well perceived fact that customer trust and commitment have become
the important factors of business success. However many conclusions have
been drawn with regard to trust and commitment. But there are very few studies
related with trust and commitment in telecom sector with special reference to
India. The relevance of Trust and Commitment Theory for mobile users of Indian
Telecom Sector has yet to be established.
257
• View potentially high-risk options as being prudent because of the belief
that their partners will not act opportunistically.
• Impact of technology
258
providers are able to build trust with both pre-paid and post-paid require
further analysis.
This research has selected four telecom service providers --- Reliance
Communications, Airtel, Hutch and Tata Indicom from four cities covering
Ludhiana, Amritsar, Patiala and Chandigarh. It is based on selected sample of
pre-paid and post-paid subscribers, dealers and telecom service providers. This
research adopts combination of primary and secondary source of information.
This study is based on primary and secondary data. The main sources of
secondary data are published reports of World Telecommunications
Development, Department of Telecommunications, Indian Telecom Policy, Year
book of Statistics, Journals, Books and various websites of the mobile operators.
The primary data is collected through the questionnaire and personal Interviews.
4 major telecom operators are selected: Reliance Infocomm, Airtel, Tata
Telecom and Hutch. Through a systematic random sampling, a sample 400
respondents are selected for administering questionnaire at the touch-points of
these selected telecom operators in the selected towns. Besides this, a sample
259
of 60 questionnaires is collected from employees and of 40 from the dealers of
selected telecom operators.
The data collected will be analysed using various statistical tools. The
basic framework of the model consisted of unobservable theoretical constructs,
which would not be measured directly. So, this study used a set of indicator
variables, which measured the unobservable constructs.
Tests for significance are less useful in small samples (less than 30) and
quite sensitive in large samples (exceeding 1,000 observations) (Hair et al.,
1995). Thus, both graphical and statistical tests are carried out using SPSS
version 10.0 for Windows to assess the actual degree of departure from
normality the mean, standard deviation and reliability estimate of each model
construct.
260
• From 2000 to 2006, traffic or usage of mobile phones increased, but the
increase was not uniform during the period. Till 2003, mobile usage went
up gradually but year 2004 onwards saw an era of speedy increase in
mobile traffic. It was probably because of the reasons that in initial days of
mobile telephony, call rates were high and the number of services offered
by cellular operators was limited. However 2003 onwards, because of the
slashed prices and add-on-services resulted in sudden increase in traffic.
261
• Telecom industry is services industry, hence the good quality services to
the customer and the customer relationship management is the key and
competition has totally changed the definition of service in Indian telecom
industry. The quality of service has improved by leaps and bounds.
• As per the FDI policy for the Telecom Sector, investment up to 49% is
permitted in Basic, Cellular and other value added services, which is
hiked to 74% in 2003-04 budget; upto 74% is permitted in Internet,
infrastructure and radio paging services and up to 100% is permitted in
manufacturing, Internet service, voice and electronic mail, based on
certain conditions for fulfilment as a part of licensing and security
requirements, laid down by the Department of Telecommunications,
Government of India.
262
• The role of private sector in the Indian Telecom Industry is expected to
increase at a higher rate in the years to come due to high existing
potential for cellular growth in urban and rural India. Year 2003 onwards, it
has witnessed a dramatic increase in the number of mobile user in India.
It was, largely propelled by decreasing tariffs and entry cost and
increasing coverage. Every month, around 2 million mobile wireless
customers were added, translating into a monthly tele-density increase of
0.2%.
The concept of trust has been explained as when one party has
confidence in an exchange partner’s reliability and integrity. There are three
dimensions of trust: perceived risk, technology orientation and reputation.
Shared value has been treated as a multi-dimensional construct. In the
telecommunication context, shared value symbolises the extent to which the
company and the customers share common beliefs on critical values like ethics,
security, and privacy. Communication, especially timely communication fosters
trust by assisting in resolving disputes and ambiguities, and aligning perceptions
and expectations. The multi-dimensional constructs that constitute
communication are openness, speed of response, and quality of information.
263
effectiveness. In short, commitment and trust lead directly to co-operative
behaviour that is conductive in relationship success.
This research tests the impact of key antecedent factors, which influence
consumer trust in mobile usage of various telecom service providers, which in
turn affects relationship commitment. The model results and hypothesis tests are
furnished below.
Some of the key findings from the data analysis are highlighted below:
264
• Commitment can be improved by prolonged interaction and intense
association between the telecom service provider and the customer.
• To reach out to new consumers in rural and remote areas, the sharing of
infrastructure must be encouraged by the government. It would, indeed,
be wasteful for every operator to duplicate costly infrastructure.
Infrastructure sharing on fair, transparent and commercial terms will
ensure that consumers in rural areas get choice of service, quality as well
as affordability. While the nation achieves aggressive rollout and
improved tele-density, the operators get an attractive commercial
proposition and an opportunity to expand the coverage and reach of their
services.
• In essence only 34.5 million mobile customers are active in the mobile
industry. The challenges for the industry to make the balance 10 million
customers also actively use their mobile, connection, which is not easy,
considering that several of these customers have shifted to another
mobile connection during the grace period, due to better scenes/tariffs.
However, thorough concerted efforts, at least a third of the 10 million
customers can be brought back to the active and paying customers list. In
the post-paid category, “Zero” usage billing customers (only rental paid)
exist to the extent of 5% of the total base, thus adding limited revenue to
operators.
• The new mobile companies, especially the CDMA operators, have learnt
a bitter lesson from this experience and tightened the controls from
January 2004. Tighter control over documentation, customer profile
265
verification, payment capacity and transferring most of the customers to
the pre-paid segment have reduced the possibility of “junk” customers
coming in to the network.
• All the activities are focused on tariff charges, launch of value added
services to enhance usage and revenue, increase or decrease of various
charges/tariff, instead of working towards market expansion. The next
revolution in the mobile industry can happen only when the telecom
companies work towards market expansion rather than price/tariff
changes. However, in the pursuit to beat each other, the focus of each
operator is only on price/tariff changes instead of working collectively to
acquire more new customers, who are confused due to the constant
changes and delay in entry.
• Markets like Gujarat and Punjab have expanded dramatically due to the
expansion of the distribution network of the handset vendors. In spite of
distribution, the handset vendors are still not offering them at an
affordable price for the Indian population. The prices are still high vis-à-vis
the affordability index of Indians and hence the growth is limited. If the
handset prices cannot be reduced further, the vendors should at least
work towards marketing second-hand handsets in order to attract a large
number of small town customers. Second-hand sets sold by reputed
handset vendors will certainly guarantee the quality of the product.
• In Punjab, the total mobile population has crossed 8.21 million by October
2006 for a population of just 34.35 million. Most states, which are
industrially advanced are at just 6% mobile penetration, clearly illustrating
the lead achieved by Punjab. Today; the mobile network covers every
urban town and most of the rural villages and all highways in Punjab,
which has enabled the state's economy to grow substantially. The
aggressive "marketing of the services by operators has ensured that most
of the youth, executives and families in Punjab own a mobile.
266
customer. The customer looks for a better association with the telecom
service provider it is dealing with. Shared value enhances the feeling of
association, developing a bonding and nurturing an associative long-term
relationship. This leads to the birth of trust.
• To ensure that every youth has a mobile, service providers have to offer
services like SMS/MMS at low cost/free and ensure that the total mobile
bill for the youth does not cross Rs.300-400 per month, which is the
maximum this segment of customers can afford from their pocket money;
267
rates vis-à-vis landline, friends and family offers, special rates to landlines
etc., with easy/low deposit schemes to acquire these facilities.
• To expand the network to a large number of towns and villages by all the
operators, network sharing should be allowed by BSNL and the
government has allowed 74% FDI in mobile companies for easy access to
funds.
• The study tests that shared value, and security in particular, is the
important determinant of trust. To earn a higher level of trust in
customers, many steps can be taken by telecom service providers. One
approach would be highlighting shared value and co-operative interaction
with customers, by recognizing the customer’s right to data ownership.
They can introduce some customer-oriented information security model,
which allows the customers to control their personal information. The use
of the security programmes or models will help customers to identify the
268
concern for customer security, to check the telecom service providers’
reliability and to evaluate the company’s trustworthiness.
• Developing the brand and the telecom service providers’ reputation will
also act as assurance to the customers. It implies enhancing, developing
and maintaining customer relationships remain a priority for organisation.
This research reinforces the importance of trust as a key driver to
developing relationship among cellular users of telecom industry.
Like any other study, this one is also not without limitations. Since the
scope of the study was limited to four major cities only. This study can be
replicated in other cities of Indian, in other industries or for cross study and
contexts for greater generalisability. Another area can be an analysis of
acquisition costs and overall profitability of the customers with strong trust and
commitments.
• How trust and related variables affect the length of the customer/service
provider relationship?
• How the relationship commitment can be improved and what are its
outcomes?
269
6.10 CONCLUSION
270
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ANNEXURE – I
LIST OF SERVICE PROVIDERS
Details of service providers: - The list of all the mobile service providers along with their
licensed service area is as under:
i
ANNEXURE – II
QUESTIONNAIRE FOR SUBSCRIBER
Dear Respondent,
I am conducting research at University Business School, Panjab University, Chandigarh for the study of Trust
and Commitment in Telecom Service Sector for which I intend to pose a questionnaire aimed at checking the
trust level of the subscribers.
Your cooperation is deeply solicitated to provide the relevant information. I assure that information will be kept
confidential.
Name of Subscriber:_______________________
Mobile No._______________________________
Mobile Company__________________________
Address:_________________________________
A 1. Through which source did you come to know about Mobile Services?
Advertisements (Media)
Friends/Relatives
Company Outlet
Internet
ii
4
Which of the following services do you avail of ?
3 GPRS / Internet
Yes No
6.
What factors would you consider while opting for a Mobile Service Provider ?
iii
S.No. Statement Strongly Disagree Neutral Agree Strongly
Disagree Agree
B) TOUCH POINTS
Yes No
Yes
No
Strongly Disagree Neutral Agree Strongly
Disagree Agree
Ambience of the company outlet
Availability of Literatures/Brochures
Rate the customer care services according to you from 1 to 5, where 5 is extremely good and 1 is extremely
bad.
1 2 3 4 5
a. Easily Accessible
iv
9.1 Rate Overall Customer Care Services
10. Has any Company executive ever Contacted you for solving your query(s)?
Yes No
Yes No
Yes No
12.1 If Yes, was the claim settled within promised time? Yes/No
13.2 If Yes, then was the problem properly taken care of?
Yes
No
13.3
How do you perceive your Service Provider
(Using Semantic Scale 1-7 , 1 being the lowest , 7 being the highest )
7 1
RELIABLE UNRELIABLE
INNOVATIVE RIGID
ECONOMICAL EXPENSIVE
v
CUSTOMER FOCUSSED UNCONCERNED
PROACTIVE REACTIVE
E) NETWORK QUALITY
How far are you satisfied with the following factors for your Service Provider
2 Network Connectivity
3 Coverage
5 Roaming facility
6 Transparency I Billing
10 Advertisement
11 Voice Clarity
12 Dealer Network
_________________________________________
_________________________________________
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16.
Do you plan to use the same services provider in future ?
G) Rank the following from 1 to 5 where 1 means strongly disagree, 2- moderately disagree, 3-
agree, 4-moderately agree, 5-strongly agree.
1 2 3 4 5
10. In times of problem, this company’s representative has gone out of way in
help.
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15. My complaints are patiently heard and tackled.
25. Other companies could also provide what I get from this company.
27. This is one of the few suppliers I could use for this product.
29. My mobile company follows various rules and regulations issued from
time to time.
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38. I enjoy discussing my mobile services with other people.
41. Under all the circumstances, I will continue to stick to this company’s
mobile services.
42. Company takes into account customers’ benefits while taking decisions.
44. I am concerned that the services are not worth the money.
50. We–me and company want to carry this relationship for indefinite period.
52. This company’s representative has been open in dealing with me.
ix
G. CUSTOMER’S PROFILE (kindly tick the suitable box)
19. Age:
20. Occupation:
Student Professional
Govt. Employee Self-Employed
Pvt. Employee Other (mention)
x
ANNEXURE – III
QUESTIONNAIRE FOR DEALERS
Dear Respondent,
I am conducting research at University Business School, Panjab University, Chandigarh for the study of Trust
and Commitment in Telecom Service Sector for which I intend to pose a questionnaire aimed at checking the
Satisfaction level of the subscribers.
Your cooperation is deeply solicitated to provide the relevant information as per the contents of the
questionnaire.
Name : _____________________________________
Address : _____________________________________________________
2. Kindly rank the following dealer objectives on a scale of 1-5 (1 being the most important and 5
being the least).
a) To enhance the Market/Segment Share
b) To achieve the targeted profit objectives
c) To enhance the consumer brand loyalty
d) Any other specify ________
3. In which of the following areas do you receive directions from the companies?
a) Sales target
b) Customer service
c) Discount/Schemes
d) Consumer Satisfaction
e) Areas to be covered
f) Advertisement Planning
g) Any other (specify) ________
6. Which of the following company product attributes appeal most of the customers? Kindly rank
them on a scale of 1-10 (1 for the most appealing and 10 for the least).
a) Product features
b) Product quality
c) Product range
d) Low price
e) Ads on TV/Newspaper
f) Convincing power of dealers
xi
g) Premium price
f) Customer service (presales and after sales)
7. Do you take feedback from the customer after the sale of the product? Yes/No
Do you forward the feedback to the company? Yes/No
8. In how many cases (percentages) do you feel the company takes decisions based on the
feedback received from you? __________________________________
9. In the current market scenario which of the following areas need to be more emphasized and
developed, in order to make a difference in the service sector (Tick whichever attribute is
appropriate).
a) Product Strategy:
Quality
Range
Features
Brand image
Any other (specify) ____________
b) Price Strategy:
Price cuts
Cost cuts
Payment and credit terms
Any other (specify) ____________
c) Promotion Strategy:
Advertisements
Discounts and schemes
Dealer incentives
Any other (specify) ____________
d) Distribution Network:
Number of Dealers/distributors
Channel Margins
Channel Support
Channel Delivery speed to the customers
Any other (Specify) ____________
d) Customer Service:
Pre-paid
Post paid
10. Are you satisfied by the kind of compensation received from the company for providing seller
support? Yes/No
a) Gross margin and overhead contribution
b) Promotional allowance and below-the line benefits
c) Distribution Exclusivity
d) Continuity of Supply
e) Market Development
f) Credit
g) Any other (Specify)
xii
ANNEXURE – IV
QUESTIONNAIRE (TELECOM SERVICE PROVIDER)
Dear Respondent,
I am conducting research at University Business School, Panjab University, Chandigarh for the study of Trust
and Commitment in Telecom Service Sector for which I intend to pose a questionnaire aimed at checking the
trust level of the subscribers vis-à-vis telecom service provider.
Your cooperation is deeply solicitated to provide the relevant information as per the contents of the
questionnaire. Information provided by you will be confidential.
Name : _____________________________________
Address : _____________________________________________________
A) General
B) Product
4. Which functional domain do your products and services address? (Kindly specify the
percentage, in case of more than one domain)
1. Banking
__________
2. Manufacturing
__________
3. Insurance & Other financial services
__________
4. Health Care
__________
5. Retail and Distribution
__________
6. Others
__________
xiii
5. Does the company export any of its services?
Yes/No
If Yes,
a) Specific the services_____________________________________
______________________________________________________
a) Have your product/services been localized according to the Indian Market demands?
Yes/No
a) What are the advantages you enjoy over the foreign companies operating in India?
____________________________________________________________________
11. Which of the following marketing channel does your company use to distribute your
products/services? Also kindly mention the approximate revenue earned through each
channel?
Revenue Earned
f) Dealer/Distributor __________________
xiv
12. Do you believe that pre and after-sales service is important?
Yes/No
13. Does the company have any authorized after-sales service stations?
Yes/No
14. Has the company fixed any specific amount of after-sales service charges?
Yes/No
15. Is the service station given any kind of directions from the company in terms of customer
service and customer relations?
Yes/No
16. Does the company maintain customer database? Yes/No
17. Does the company take feedback from the customer after the sale of the product?
Yes/No
If Yes, feedback is taken-
a) Regularly
b) Sometimes
c) Never
21. What kind of training do you provide to the new Marketing Personnel?
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
xv
23. Compensation to the marketing personnel is given in the form of:
a) Fixed Salary
b) Fixed Salary cum commission on sales
c) Only commission on sales and incentives
d) Any other (specify)__________________________
24. Are the Marketing personnel given any refresher training courses? Yes/No
If Yes, then after how much time period___________________________
Please indicate your position in the company (i.e. job title)
25. In which of these areas would you like your company to improve its marketing strategy:
• Product
• Price
• Promotional Activities
• Distribution Network
• Customer Service
26. Did you face any difficulty while filling up the questionnaire (please specify)
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
Please attach your business card if you would like to receive a copy of the study findings.
xvi