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Responding to 4G telecom pricing war: ignore, accommodate or retaliate

Neeraj Pandey (Department of Marketing, National Institute of Industrial Engineering, Mumbai, India)
Anish Kumar (National Institute of Industrial Engineering, Mumbai, India)

Emerald Emerging Markets Case Studies

ISSN: 2045-0621

Publication date: 26 June 2018

Abstract

Subject area

Marketing, Pricing, Strategic marketing.

Study level/applicability

The case is developed for an MBA-level program.

Case overview

In May 2017, the telecom industry in India witnessed an intense price war over 4G (fourth generation) data prices. Gopal Vittal, CEO of Bharti Airtel was exploring various options on how best to respond to the situation. He had to take a final call regarding Bharti Airtel’s marketing team’s counter move to tackle this price war by Jio – should Bharti Airtel ignore it, accommodate it or retaliate with even lower prices? Bharti Airtel strongly believed that Jio pricing structure had violated “fair pricing” norms, and its pricing was anti-competitive. It had filed a case with the Telecom Regulatory Authority of India (TRAI) and the Competition Commission of India (CCI) to restrain Jio from further giving “free” promotional offers and penalize it for it. Could the legal recourse by Bharti Airtel dampen Jio’s consistent subscriber growth rate?

Expected learning outcomes

The case provides the students with an insight into how the competition focused on pricing happens in the telecom industry. The pricing war affects the profit margin of all competing companies. It changes the customer reference point for evaluating the competing products and services. The students would also learn practical applications of positive-sum pricing, pricing war, fair pricing and legal aspects of pricing. This case provides the students with an opportunity to understand the pricing war and how to respond to it in a particular situation; understand positive-sum pricing and negative-sum pricing in telecom industry context; understand legal aspects of pricing; and how to leverage data for gaining newer customer insights.

Supplementary materials

Teaching Notes are available for educators only. Please contact your library to gain login details or email support@emeraldinsight.com to request teaching notes.

Subject code

CSS 8: Marketing.

Keywords

Acknowledgements

Disclaimer. This case is written solely for educational purposes and is not intended to represent successful or unsuccessful managerial decision-making. The authors may have disguised names; financial and other recognizable information to protect confidentiality.

Citation

Pandey, N. and Kumar, A. (2018), "Responding to 4G telecom pricing war: ignore, accommodate or retaliate", Emerald Emerging Markets Case Studies, Vol. 8 No. 2. https://doi.org/10.1108/EEMCS-11-2017-0251

Download as .RIS

Publisher

:

Emerald Publishing Limited

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