Vodafone India Mobile Data Growth Worst among A-Vo-Id Operators

Vodafone India Internet Traffic DropsVodafone India’s Mobile Data [3G] revenue grew by meager 4% to INR23.9bn. This explains the weak data absorption, which is worse than Idea’s 7% and Airtel’s 10% growth. This is led by 13.5% data volume growth, largely offset by a
sharp 8% data pricing fall in line with industry’s data rate fall reaching INR 0.28/mb. Data usage / user has increased 11.5% to 438mb/month led by 9% increase in 3g subscribers 25.9mn (consuming higher data), but overall data subscriber growth have remained flat.

Vodafone added 7,600 3g sites during the quarter, reaching about 47,000 3g cell site, far lower than Airtel’s 77,500 sites, but similar to Idea. This is 40% of the 2g coverage. Vodafone introduced Project Spring four quarters back to ramp up data network. It has launched 4g in Karnataka and Kerala and targets to expand this to five circles by March covering around 45% of current data revenue.

Voice saw subs led traffic growth of 2.3% to 181.2bn minutes, in line with Bharti and Idea. Blended voice RPM fell by just 0.3%, but outgoing voice rpm declined 3.7% QoQ, in line with Bharti and Idea. Vodafone management admitted that it witnessed intense competitive activity which has increased subscriber addition of 5.4mn to 2.5x compared to last two quarters; but at the cost of severe pricing pressure.

With limited competition from the smaller players and all the top 3 incumbents’ intention to improve pricing, channel checks indicate price competition is at the premium segment to protect high ARPU data customers with the onslaught of Reliance Jio 4G-LTE where Vodafone is the most vulnerable operator.

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