As the current market place becomes more competitive, consumers tend to become more and more demanding. Mobile telecommunication service sector in India has been experiencing the highest growth rate in terms of subscribers and revenues. With the increasing competition in cellular services, the consumers are demanding more. The main condition for protecting the subscriber base is to win customer loyalty. This study attempts to examine the effect of switching cost, service quality and customer satisfaction on customer loyalty in the mobile telecommunication services. As many as 220 users of GSM services were surveyed in two cities in India. The data was analyzed by regression analysis. The study shows that the switching cost, service quality and customer satisfaction have positive association with customer loyalty. However, the customer satisfaction was found to be the best predictor of customer loyalty.

The rapid growth of services industry has changed the conditions of business. As the market growth slows down or as the markets become more competitive, firms are more likely to attempt to maintain their market share by focusing on retaining the current customers. (Lee et al., 2001). Customer retention has been advocated as an easier and more reliable source of superior performance (Reichheld and Sasser, 1990).

In the past few years, the mobile telecommunication market has witnessed a substantial growth and a rapid change globally as well as domestically. The Indian telecom sector has currently witnessed a resurgent growth rate of 45% in the year 2007, which is the highest in the world. The wireless industry made a healthy contribution in the growth of telecom sector (TRAI Annual Report 2007). A total of 66.34 million subscribers were added in the financial year 2006-07, registering the annual growth rate of around 83.17% (TRAI Annual Report 2007). Achieving and maintaining a commanding position in such a growing market place is becoming increasingly difficult because of more competition on the one hand and more demanding customers on the other.

Service Quality, Customer Satisfaction, Customer Loyalty, Cellular Service Providers, Indian Market, Mobile telecommunication service sector, subscribers, revenues, consumers, business, market growth, mobile telecommunication market, Indian telecom sector, TRAI Annual Report, telecommunication services.