Airtel, Vodafone and Idea Cellular the A-Vo-Id Telecom Lobby in India continued to add subscribers amidst launch of Reliance Jio 4G Network. A-Vo-Id operators are focusing more (for subscriber adds) on rural areas and Jio’s initial focus is likely to be on urban areas where offtake is likely to be through dual SIMs given urban tele density is already >100%. We believe, looking at the incumbents sub data, Jio’s free period offer doesn’t appear to have impacted their net adds.
Reliance Group President has announced that it has crossed Continue reading A-Vo-Id operators Subscriber addition continues amidst Jio Launch
The Indian telecom industry had clocked a robust triple digit data volume growth in FY14 and FY15 with proliferation of smartphone shipments and 3G adoption leading to spurt in number of subscribers and data usage per customer. However, data volume growth is already tapering as the pace of smartphone penetration is losing steam. Along with weak macros, postponement of handset purchases by users awaiting RJio 4G launch or lower discounts on e-commerce portals stemming impulse buying could be possible reasons for slower shipments.
IDC has reported continued deceleration in smartphone shipments with meager 3.8% YoY growth in Q1FY17 versus 5.4% in Q4FY16. One could attribute the slowdown to lower discounts on e-commerce portals and stress in rural economy. With currently the SmartPhone base at Continue reading Can India Hit 500Mn Mobile Broadband Subs by 2020 ?
With respect to the Indian mobile consumer spend, the three factors coming to the fore in the India telcos is important to take notice of as the competitive intensity increases.
ARPU & Subscribers Growth – Most of the subscriber addition in India is largely coming from the lower ARPU subs, which negates any upward migration of ARPUs of existing subs graduating from 2G to 3G or from 3G to 4G (or even 2G to 4G directly). Also, note that the Top 10-15% sub-base in India has disproportionately high economics relative to the average Continue reading Dynamics of Mobile Subscribers Spend in India
Nokia’s latest report on the state of Mobile Broadband in India suggests that the Indian data market continues to be in a sweet spot backed by – high-end 2G data users are migrating to 3G, 3G/4G device penetration is accelerating on the back of decreasing handset prices, video, audio and social networking are driving traffic and average usage on 3G in India is reaching global benchmarks.
Indian Consumers get Taste of 3G High Speed Networks
3G data traffic growth in Metros stood Continue reading Mobile Broadband in Sweet Spot – Ecosystem Favors Growth
Plain Vanilla Wireless Operator Idea Cellular reported a whopping 103% yoy and 13% qoq growth in data revenues to Rs14 bn in Q4FY15. Data revenues formed 16.9% of wireless service revenues for 4QFY15, up from 10.1% in 4QFY14. Market leader Airtel which has adopted different strategy reported Data revenue growth of 70% yoy at Rs23 Bn in Q4FY15. Even though Idea grows on a smaller revenue base relative to Airtel, growth of 103% is certainly commendable. We understand Airtel’s reluctance to aggressively chase volumes on the voice side but do not see any valid rationale for sustained under performance on data revenue growth rates.
Idea Cellular’s Data revenue growth was Continue reading Idea Mobile Data Growth Faster than Airtel at 103% YoY
Idea Cellular management hosted a conference call today to discuss the recently concluded spectrum auction. The company successfully renewed its crucial 900-spectrum in key circles. Airtel and Vodafone both extended their 3G spectrum footprint to 21 and 16 circles respectively, and have surpassed Idea on revenue coverage under own 3G. Airtel has stolen a march over both Vodafone and Idea, by picking up the maximum amount of 900-spectrum.
Idea management said that data volumes (Terabytes or TB) may grow at >100% CAGR over next 2-3 years . This would lead to a materially higher revenue growth trajectory for Idea and the whole industry, provided data realization or ARMB does not fall much below forecasts. Idea reiterates the view that India is not yet ready for Prime-Time 4G LTE Mobile Data mass market.
Idea indicated that 4G rollout (FD-LTE on 1800 band) would start from FY17 in select circles (Karnataka appears to be a leading 4G candidate). Capex will increase yoy in FY16, due to 3G launch in Delhi/Mah/Kolkata, as also due to
2G network reconfiguration due to replacement of 900-equipment with 1800. Mgmt. clarified there would not be any write-off of 900-equipment, as the existing electronics will be reused. Idea expects 2G capex to end by FY17, and expects new 4G capex to offset reduced 2G capex.
The Big 3 Operators profile customers’ handsets on network capability and has lot of back-end analytics to crunch the potential that lies ahead unless Reliance Jio disrupts the market heavily, which is unlikely going by its track record in telecom business.