The lifetime scheme has been a departure from the traditional model without the former part. This resulted in a concern whether the tariff scheme is predatory in nature and could adversely affect the sector in the long run.

However it is seen that the tariff schemes with lifetime validity are providing an ARPU of Rs 218/- per month, which is almost 2/3rd of the average ARPU (Rs 324/-) for mobile service. But with a few rare exceptions, scheme is offered in prepaid platform. Hence, it will be reasonable to compare the ARPU figures with that of prepaid. Average ARPU for prepaid is Rs 261/- per month and the difference is just 17%. Having said that, an ARPU of Rs 218/- appears to be quite reasonable.

RPM is also an accepted parameter to gauge the effective revenue realization by the operators. On an all India average revenue per minute (outgoing + incoming) for tariff schemes with lifetime validity is Rs 0.80.

This is slightly higher than the average for full mobility service (Rs 0.77). This in a sense also implies that the scheme is not that cost effective for subscribers, as it prima facie appears to be.

The big picture emerging from the analysis based on empirical data is that the scheme has been very popular in the market. The scheme has been one of the driving forces responsible for the explosive growth of mobile subscribers, which is witnessed in the current year i.e. 2006. At the same time, service providers seem to have been getting a reasonable ARPU from the scheme despite the fact that the scheme was primarily targeted towards low usage and marginal customers. The scheme has kept the tariff levels at Rs 2/- per minute for local calls and Rs 3/- per minute for domestic long distance calls, which are much above the call charges prevailing in the market under other plans. Thus any outgoing usage by the subscribers, will contribute directly to the ARPU of the service provider.