Satyam infoway case final

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Marketing Management - Pricing Policies at Satyam Infoway

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Introduction… Satyam - One of India’s leading integrated Information

Communications Technology companies.

Set up in December 1995 as a subsidiary of Satyam

computer services in Chennai.

Launched corporate connectivity services over India’s

first TCP/IP backbone telecom network infrastructure

enabling connectivity.

Helped change the way enterprises communicate and

grow.

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Satyam Info way to Sify…

Rechristened as Sify.

Independent Entity with a reduction in

Satyam stake from 52.5 % to 37.1 %.

Presence in both the B2C and B2B segments.

Pioneer in offering off-the-shelf ready to use

internet connection packs.

Organized cybercafé chain business.

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Marketing Mix…Product… Sify

Consumer Segment

Internet services

Cyber cafes

Corporate Segment

Internet Solutions

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Product Contd…Launch of new services such as :

1) Secure connect.

2) Express connect.

3) DocImage.

4) Express talk.

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Price… Broadband services were priced according

to speed and hours used.

Psychological pricing strategy.

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Place…Targeted metro cities like Mumbai, Delhi.

Entry into rural markets.

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Promotion…Internet enquiries.

Television Commercials.

Newspaper advertisements.

Pamphlet Distribution.

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Porter’s 5 Force Model…

Rivalry amongst

existing firms

Threat of New

Entrants

Bargaining Power of Suppliers

Threat of Substitutes

Bargaining Power of Buyers

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BCG Matrix…

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SWOT ANALYSIS…

• Strengths• Presence in both B2C & B2B segments.• Corporate segment-end-to-end internet solutions.• Consumer segments-it offered dialup & broadband

internet services with different offerings.• High speed internet service.• First players in the organized cyber cafe chain

services.• Unique technology to deliver broadband service &

special CLI based product for dial-up.

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Weaknesses…• The broadband service can only be availed

through phone lines.

• Tough competition from leading companies

such as BSNL which had better plans &

services.

• Very high prices were offered for services.

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Opportunities• Better technology can be used with better

broad band services i.e. in speed & validity to

meet competition.

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Threats…

• Major threat from BSNL.

• New entry of other big firms offering better

products & various other ISP’s & cable

operator.

• Lower prices offered by competitors.

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Pricing Strategies…Creaming or Skimming.

Penetration pricing.

Competition based pricing.

Cost plus pricing.

Premium pricing.

Psychological pricing.

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Pricing AnalysisThe company follows a strategy of quantitive

discount & Psychological pricing & Psychological

Placing.

Evaluating the exhibits:

To evaluate Price per usage exhibit 1 we have

calculated it by using formula.

Price Per usage= Price/No of hours used, Price

Per Validity= Price /Validity Period.

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Pricing AnalysisChange in price per change in usage or validity or

Usage(Impact of discount)= change in price/(change

in validity).

Exhibit 2: To evaluate broad band Sify Service plan

2005 =>Price/validity or speed or no.of hours.

The trend for dialup access plans & sify broad band is

near about same & hence the basic pricing strategies

of quantity discount is same for both the plans.

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Dial up Access plan

99 249 349 799 1799 31990

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40

60

80

100

120

Price Per ValidityPrice Per Usage

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Comparative AnalysisSify Plan are more expensive than compare

to its competitor .

Bsnl & Airtel have better market share than

sify because of better advertising & sale

strategies.

Bsnl uses price differentiation like combo

pack its various tariff plan where as sify

provides prices concession in almost all its

tariff plan.

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Future ChallengesState own BSNL was planning to launch

broadband service name Dataone

Dataone uses ADSL technology which will allow

BSNL to offer high speed internet connectivity at

nominal price.

Tata Indicom already launched internet service.

Reliance was also poised to launch the service.

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Current Scenario…

Market Share of 43 % - BSNL

Market Share of 19 % - MTNL

Market Share 0f 11.9 % - SIFY

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The Road Ahead…Sify’s main target is to provide wireless

connectivity to its customers all over India.

The company was also targeting corporate to

provide them the service of VPN.

Sify’s future target was to provide a more

reliable and secure connection to its customers.

Sify is going to concentrate on VOIP and IPTV

technology.

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Conclusion…Sify is a regularly growing organization in

the field of internet service.

It has brought a revolution by bringing the

Broadband technology at cheaper rates to

make it a more affordable, reliable and more

secure network to be ever used.

It changes itself according to market

requirements.

Offers wide range of services to consumer

and corporate segment.

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Faces stiff competition from many big and

small internet service providers specially in

pricing policy.

If Sify opts right pricing strategy than it may

remain a market leader in its segment.

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Prepared By:

THANK YOUAanchal Mittal

Nikhil Mansukha

ni

Ahmed Naeem

Ishita Jain

Prasoon Garg