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Why some telcos, senders love pesky SMSes

delhi Updated: Aug 24, 2011 02:11 IST
HT Correspondent
HT Correspondent
Hindustan Times
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SMS messages asking you to buy property, car, insurance, pizza or slimming belts are more menacing than the annoying telltale beeps. They are at the core of a Rs 130 crore industry that is thriving on hounding India's more than 800 million mobile phone customers with spam texts, aided by a few private telecom operators.

"I get such a large number of bulk SMSes that deleting them has itself become a big job," said Vinay Tyagi, an employee of a Ghaziabad-based private firm. An estimated 75 million such bulk texts are sent out every day.

Last week, communications minister Kapil Sibal promised action within six weeks that would offer customers the option of blocking such texts once DND (do not disturb) number 1909 gets operational.

Mobile phone users would be able to block SMS in seven categories such as real estate, credit cards, consumer durables, banking and finance by registering their number with the national do-not-call (NDNC) registry by calling or sending a text message to toll-free number 1909.

But the onus to end the harassment will still be on the customer, not on those who send out such texts who prosper on a low cost-high volume model.

Industry sources said only a few telecom operators such as Tata Teleservices Ltd (TTSL), Videocon Telecommunications (earlier known as Datacom) and Loop Mobile allow telemarketers to send bulk SMS messages through their networks.

India's largest telecom service provider Bharti Airtel does not allow its network to be used for sending bulk texts, as also Vodafone, Reliance Communications and Idea Cellular.

Videocon Telecommunications denied that it allows bulk messages to be sent through its network. "We are not doing any bulk SMS business," a company spokesperson said in an emailed response.

Loop Mobile said it allows only registered telemarketers to send bulk SMS through its network.

"Only registered aggregators use our network for telemarketing and transactional SMS messages are processed through NDNC scrubbing by the aggregators and sent only to those who are not registered under NDNC," a Loop Mobile spokesperson told HT in an e-mailed response.

TTSL said it would not comment for this story.

"Airtel voluntarily exited the bulk SMS business a year back. We decided we did not need this revenue at the cost of consumer dissatisfaction. We continue to decline requests for additional telephone lines from known telemarketers," said Sanjay Kapoor, chief operating officer (CEO) of Bharti Airtel.

For the sender, the sheer economics and scale of "spamming" people with texts is a steal.

A deal for sending out 100,000 SMS messages can be bought for as little as Rs3,000, and even if one customer falls prey, it will more than offset the costs.

"It costs a mere 3 paise for a real estate developer or a brokerage firm for each bulk SMS sent. Even if one person books a property in response to these text, then it more than compensates the broker," said Sanjay Sharma, managing director Qubrex, a real estate consulting firm.

Telemarketing firms purchase the database of phone numbers from dedicated agencies who collate data from various resource points such as courier services and even shopping malls where customers often fill up forms and share their mobile numbers.

A database of 100,000 mobile phone numbers can be purchased for about Rs50,000.

"There are specialised firms who have tie-ups with mobile phone operators. We pay them a price per SMS and these firms give us access to dedicated websites that enable us to push through more than 100,000 bulk text messages to mobile phone customers in a matter of minutes," said the owner of telemarketing firm operated out of small room in New Delhi's upmarket South Extension area.