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No Takers For 4G: Airtel Reports 3,180 TD-LTE Subscribers

Following the launch of its 4G services in Kolkata and Karnataka circles, earlier this year, Airtel has been able to sign-up 3,180 subscribers. The data was provided by the Minister of State for Communications & Information Technology, Milind Deora in the Lok Sabha, adding that the Indian Government had provided Broad Band Wireless Access (BWA) Spectrum for 4G services to six different service providers through Auction apart from BSNL & MTNL. He also added BSNL has provided 50,077 connections through 4G/WiMAX.

We are not surprised that the response to Airtel’s service has been anything but luke-warm due to:

– High tariff: the tariffs for access were really high, starting at Rs 999 for 6GB data, going upto Rs 1,999 for 18GB data, and the speeds being throttled down to 128kbps after the user crossed the data limit. Also the USP of 4G was speed and the data caps are ridiculous as high quality video content gobble up tremendous amount of data.

– Absence of devices & high cost of existing ones: 4G-compatible handsets or tablets that can work on Airtel’s frequency band aren’t available in Indian market yet. Airtel offers LTE compatible  multi-mode USB dongles and an Indoor Wireless gateway. The access devices are expensive with the USB dongle being priced at Rs 7,999 and the Indoor wireless gateway priced at Rs 7,750. The company bundles devices with plans if a customer commits to sign up for a long-term contract. With the entry costs being so high, one can’t expect to find many takers for the service.

– Partial coverage: Airtel had informed during the Kolkata launch that the roll-out in Kolkata was limited to 20-25 pockets.So connectivity across the city was not seamless and it was focusing on indoor coverage. Why would someone shell out a large amount of cash and get a crippled service experience?

In May 2012, Airtel signed an agreement with Qualcomm, under which, it made an initial investment of approximately $165 million (Rs 927.39 crore approx) to acquire 49% interest in Qualcomm’s India entities that hold BWA/4G licenses in Delhi, Mumbai, Haryana and Kerala. So, we hope that Airtel irons out these problems if it really intends to make the service mass market and recover the cost of acquiring spectrum, when it launches services in new circles.

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