Sistema to break even in 7 yrs

Telecom player Sistema Shyam Teleservices Ltd (SSTL) expects to make money from its India operations in 7 years, said Vsevolod Rozanov, the company’s president and chief executive officer.

The company, a joint venture between Sistema of Russia and the Shyam Group of India, has planned a capital expenditure of $5.5 billion over the next 5 years. At the launch of Sistema’s telecom services in Tamil Nadu circle, Rozanov said, “We are optimistic about our target.”

The company has rolled out its services under the brand name MTS, which already provides mobile services in seven other countries and has a subscriber base of over 100 million.

On the long target of 7 years compared with that of 2-3 years by new telecom players, Rozanov said, “We know we are among the five new players entering the telecom fray in the country. That means gaining critical subscriber base will be slow initially.

owever, since CDMA supports faster data download, provision and acceptance of value-added services will be faster. This would increase our average revenue per user (ARPU) and subsequently, revenues.” Sistema has launched some competitive schemes such 10 lakh minutes of free talk time for every subscriber. “We aim to adopt most competitive pricing on both local and off-net local calls,” said Srinirao Saripalli, the chief operating officer of the company.

The firm has lined up an expenditure of Rs 150 crore this year for marketing its products and services. “The marketing expenditure will vary from one circle to another. Even then, on an average we will be investing about $3 million per circle on marketing,” Lenny Musatov, chief marketing officer, told DNA.