Sunil Sood has become the Chief Executive officer of Vodafone India at a time when the company is at the cusp of charting out its next phase of growth. The competition in the sector is set to hot up with the entry of Reliance Jio next year, and there are several regulatory challenges that Vodafone has to steer through. Amid this, the company has also started preparing for an IPO. For Sood, an old timer at Vodafone, the elevation to the top job in April is an endorsement of his ability to steer through clutter and focus on business. In a conversation with BusinessLine , Sood outlines his plans for the second largest telecom operator in the country.
Are you seeing OTT (over the top) players eating into your revenues?
Not yet. Overall, they are generating a lot of revenues for us. The operators are helping them gain more customers, while for us they are bringing in revenues. It is affecting some of our voice business, far more in the international long distance telephony business than the domestic business.
What is your view on the models such as Internet.org or Free Basics?
Should people be allowed sampling to enable usage? Yes, we do it all the time. We give free data, free SMS, voice to enable users try them out and upgrade. It’s a win-win situation for all. For us it’s not so critically important for us to have Free Basics, and not unimportant that I need not participate.
It helps me to increase my data business, and provide the users what they need. There are various ways we can play this game. For example, I can give you 50 MB free or Facebook free. Let the regulator decide what’s right and what’s wrong, we will abide by that rules. For us it’s not do or die situation.
Are the voice revenues flattening?
Our growth this year in voice has been higher than that in the previous year. In general, our own voice is not flattening, it’s growing in minutes. The overall growth in the industry is slowing down, but gradually. This year we expect a percentage lower than that a year ago. The overall impact on voice is on the revenue side because of the fall in termination charges, so value-wise you would not see much growth. However, the minutes generate by the overall industry are going up.
Organisationally, what are the things you want to do to be ready for data growth?
The big challenge is educating the users. Most people in India are now using data on the mobile. Phones are getting cheaper, and with the Internet boom that is happening, which is making data to move faster, there is a rationale of why people should use data.
What is in it for me? People do not understand that data is different from voice. In the past 20 years of voice service, people only made calls when they wanted to. In data, the game is very different. The user has to pay the moment he gets a WhatsApp message, irrespective of whether he has read it or not. Incoming data is not free, and that requires a massive amount of education for him to understand.
The biggest challenge now is to educate the common man that voice and data are charged differently.
Earlier Vodafone had taken a view that 4G was not important in the near term. Now Vodafone is launching 4G services. What’s changed?
We had articulated last year that 4G was not particularly important. A month back, the overall 4G phones on our network was below 2 per cent, whereas 3G phones were about 26-27 per cent. There are a couple of barriers for entry of 4G.
One, you have to change your SIM card. Two, you have to change your phone, because now only two per cent of our base has it. Everybody doesn’t want to change the phone as there is a financial outgo. Plus the whole eco-system is still evolving. Even today, 74 per cent of the market does not have a smartphone.
Is 4G going to be a metro play?
It’s going to be a metro play. That’s why I am launching it in the metros. The probability of users upgrading is higher in the metros as they have been already using data. That’s why we are launching it selectively and not nationally.
Where do you see Vodafone next year?
We want Vodafone to be the most advocated brand, the most promoted company among all our customers. That’s the picture we want to achieve as a company and as a brand.
You are not chasing No. 1 ranking?
I think that’s the secondary effect. That will happen automatically if you achieve these goals.
If you are the best brand, if you are the most advocated brand, and has the most net promoter score by consumer base, then you have achieve it.
What are your plans on the IPO?
We are preparing and getting ready for an IPO, and if we see the market is right and our board gives us the go ahead, we would like to do one.
It requires a lot of preparation, at least a year to year-and-a-half. It’s very early stages.
Full interview on Web