Windows LiveCustomer Solution Case Study

Hosted Email, Social Media Helps Broadband Supplier Boost Customer Engagement

OverviewCountry or Region: IndiaIndustry: Telecommunications

Customer ProfileMTS is a fixed and mobile telephony service provider, which is majority-owned by the Russian conglomerate Sistema. Based in India, MTS employs 3,000 full-time staff members.

Business SituationIn 2009, MTS started selling USB modems that provided fast Internet access. The service was popular, but MTS wanted to reduce churn and increase revenue derived from each customer.

SolutionIn mid-2011, MTS joined the Windows Live Service Provider Program, which will enable it to provide co-branded Windows Live email and other online communication services to its customers.

Benefits Increased customer loyalty Lower support costs New commercial opportunities Competitive differentiation

“Our new universal dialer for data products will help us gain new customers because it allows us to differentiate ourselves from our competitors.”

Constantino Hionides, Director of Partnership Management, MTS

Based in Gurgaon, India, MTS is a telecommunications company that provides telecom services to over 11 million customers. In 2009, the company launched a mobile broadband service, but to sustain growth and market share, it needed to increase customer loyalty and create up-selling opportunities. To achieve this, its marketing department wanted to engage customers directly via email. In 2011, MTS joined the Windows Live Service Provider Program. The program will enable MTS to provide its millions of customers with co-branded Windows Live email and other online services that are rich in social media integration, thereby giving MTS a distinct advantage over its competitors. In addition, the marketing and customer service departments can engage customers with targeted offers. Most importantly, under the terms of the program, Microsoft provides the services at no cost to MTS.

SituationGurgaon-based MTS is one of India’s fastest growing telecommunications companies and the second-fastest growing CDMA operator worldwide. From its origins as the licensed provider of fixed telephony in Rajasthan, the company has expanded into mobile services, becoming one of 14 companies licensed to provide mobile services using the CDMA2000 technology standard in India. By mid-2011, MTS had acquired over 11 million wireless subscribers and was adding new customers at a rate of 700,000 per month.

MTS prides itself on innovation, and in November 2009, the company launched a high-speed mobile broadband data service, called MBlaze. Customers purchase USB modems—or Internet dongles—which provide Internet access with unlimited data downloads for set periods of time. The service is activated via a pop-up connection message, called a “dialer” that pops up as soon as the dongle is inserted into a computer or mobile device. Once an account is opened, customers can purchase additional credit online.

During its first 18 months, MBlaze proved exceptionally successful. MTS expanded its fast Internet service to 150 towns across India, attracting 700,000 customers and capturing approximately one-third of the market for new mobile broadband subscribers each month. However, the capacity for continuing rapid growth depended on the company overcoming three key challenges: improving customer retention, monetizing the customer base, and converting customers to post-pay contracts, where customers pay a monthly bill for Internet access.

“Mobile broadband is a very fluid market, and the churn rates are high, which means a large proportion of new customers switch between service providers. To build loyalty, our customer service teams needed to find a way to communicate directly with our customers,” says Constantino Hionides, Director of Partnership Management at MTS.

Monetizing existing customers also proved difficult because of the limited opportunities for cross-selling and up-selling. The dialer that appeared on the screen when customers activated the MBlaze service was one of the points of contact that MTS had with each customer, but it was static and did not allow MTS to target marketing messages effectively.

SolutionThe marketing department realized that the best solution was to give customers a new experience. And if the business needed closer customer engagement, the most compelling option was social media.

“India is experiencing massive social change at the moment,” comments Hionides. “Whereas the family used to be at the center of society, now people are focusing on projecting themselves to a wider audience. The social media phenomenon has become very important. What we wanted to do was to tap into that demand for social communication by using the dialer message and provide a social media forum where we could talk directly to the customer.”

In November 2010, Thomas Matthew, Business Development Manager at

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“The more time customers spend using social media, the more time they spend next to our brand.”

Constantino Hionides, Director of Partnership Management, MTS

“We now have a great opportunity to up-sell to our customers.”

Constantino Hionides, Director of Partnership Management, MTS

Microsoft, visited MTS, so Hionides invited Matthew to present the details of a corporate version of the online services platform, the Windows Live network of Internet services, and introduce the company to the Windows Live Service Provider Program.

“The Windows Live Service Provider Program enables commercial service providers to give customers the core Windows Live services on co-branded and customized webpages and provision them with corporate domain email addresses,” says Matthew. “It’s attractive to companies because they can create or maintain an email channel with their customers without paying for software or investing in back-end infrastructure or hosting costs.”

As demonstrated by Matthew, the platform provided email, messaging, search, and photo-sharing services with the ability to import contact lists from other email accounts and social media platforms, such as Facebook and Twitter. The service also included a web-based administration tool called Windows Live Admin Center that enables companies to brand webpages with corporate logos and colors, establish links from site menus, and provision and manage email accounts.

“Our Russian colleagues at Sistema gave Windows Live a thorough technical evaluation,” says Hionides. “It was very robust and could do the majority of the things we wanted, so we signed up for the program in 2011.”

MTS has employed an international partner to build a new dialer system that will work along with the Windows Live platform. By

integrating the Windows Live services with the dialer, it would make it much more “sticky” for the customers and, more importantly, encourage them to want to continue using the MTS service. The Windows Live platform allows the customers to consolidate all of their social media and email accounts in one place, making it much more convenient for them. As an experienced observer of system deployments, Hionides is particularly impressed by the ease of the migration, including the provisioning of millions of email accounts for existing customers. “I’ve been working with MTS since we were a 30-person company and have seen plenty of deployments, including CRM [customer relationship management] systems that take half a year to deploy,” he says. “Comparatively, this deployment and migration will be very straightforward.”

In July 2011, MTS will begin a two-stage deployment, pushing out email accounts to 700,000 existing customers and automatically provisioning accounts for new customers. The company’s target is to create 2 million new accounts by the end of 2011.

BenefitsWith the co-branded Windows Live services, MTS has created a social media platform that enables the company to directly reach millions of customers, but without having to invest in large-scale server infrastructure, hosting, or research and development costs. By creating a social media experience for their broadband customers, executives believe they will clearly differentiate MTS from its competitors.

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Increased Customer LoyaltyHionides believes that the lure of an integrated social media space will help MTS reduce churn and increase customer retention.

“The more time customers spend using social media, the more time they spend next to our brand,” says Hionides. “We are also planning to integrate email accounts with our in-house CRM system. This will allow us to target offers and information to customers based on what we know about them, and keep them from moving to our competitors.”

Lower Support CostsWhile improving customer service, MTS executives can also lower customer support costs. By establishing direct customer communications by email, MTS can help improve the purchasing experience for the growing numbers of post-paid customers.

“Previously, we used agencies and automated outbound calling to contact customers to give them certain pieces of information,” says Hionides. “Now with email it will be easier. In addition, we can automatically send billing messages via email for our post-paid customers.

New Commercial OpportunitiesMTS believes that targeted messages and the ability for customers to click through to MTS landing pages will help the company monetize its large, fast-growing customer base. “We now have a great opportunity to up-sell to our customers,” says Hionides. “For example, we can send them an email when they are three-quarters of the way

through their pre-pay period, tell them how much time they have left, and provide them with direct and easy ways to recharge their accounts online.”

Competitive DifferentiationFor MTS, the biggest potential benefit will be the “first-mover advantage”—by creating an advanced and interactive dialer that leverages the different social media platforms for its customers, MTS is doing something that none of its competitors are doing, and it has an opportunity to capture market share in a compelling way that competitors will find hard to win back.

“Because we are being different and innovative, we are automatically distinguishing the MTS brand,” says Hionides. “Our new dialer will help us gain new customers because it allows us to differentiate ourselves from our competitors.”

Windows LiveWindows Live delivers the most comprehensive suite of online communications and sharing services in the marketplace today, such as Hotmail, Messenger, SkyDrive, Photo Sharing, and Microsoft Office Web Apps.

All you need to get started is a Windows Live ID to access all Windows Live services.

 For more information about Windows Live, go to:explore.live.com

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For More InformationFor more information about Microsoft products and services, call the Microsoft Sales Information Center at (800) 426-9400. In Canada, call the Microsoft Canada Information Centre at (877) 568-2495. Customers in the United States and Canada who are deaf or hard-of-hearing can reach Microsoft text telephone (TTY/TDD) services at (800) 892-5234. Outside the 50 United States and Canada, please contact your local Microsoft subsidiary. To access information using the World Wide Web, go to:www.microsoft.com

For more information about MTS products and services, call +91 124 4812500 or visit the website at: www.mtsindia.in

This case study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY.

Document published June 2011

Software and Services Windows Live