Thursday, January 10, 2013

What got you there, won’t get you (back) here

If there has to be a case made out for mistakes in identifying India as a target market, AT&T wouldn’t even find competitors in its ring. AT&T and Tata had picked up stake in Birla Communications in the year 2001 and rechristened it as Idea Cellular Ltd. Considering that the wireless market in India at that time was just picking up, there would have been immense opportunity for AT&T. However, due to the tussle amongst the partners and given that Idea Cellular only had limited circles to operate in India, AT&T – after just three years, in 2004 – amazingly announced its decision to call it quits.

Analysts say Cingular had taken over AT&T Wireless in the US and the new management wanted to concentrate on the American market that was becoming increasingly challenging. But how could one justify even that with exiting the Indian market (AT&T informed stakeholders in Idea that it does not consider its investments in India as ‘strategic priority investment’). In 2004, Birla and Tatas both bought over the stake of AT&T.

Once AT&T realised the mistake it had made, it tried to re-enter the Indian market in 2006, by tying up with it Mahindra Group to launch National Long Distance (NLD) and International Long Distance (ILD) calls. As a matter of fact, AT&T was the first company in the country to offer NLD and ILD facilities. But Portica substituting for Cleopatra? Get aside Caesar, no way! Although it was a significant step of AT&T to stay in the Indian wireless market, it was not the same as being a cellular service provider. When in 2008, the fresh spectrums were being issued, there were speculations that AT&T would partner with DLF/ Mahindra Group.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
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