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Calling The Bluff On Indian Govt’s Claim Of 485.6M Internet Subscribers

We’re calling out the Indian government on its claim of 485.6 million Internet subscribers: this number is misleading, we would recommend that those reading this not make any business decisions based on this data point. Pankaj Pachauri, Communications Adviser to the Prime Minister of India, has repeatedly claimed this as the number of Internet subscribers in India on Twitter over the past couple of weeks, and while we didn’t give that much credence, Mint has (rather surprisingly) included that number in their report, citing Pachauri.

Pachauri told us (via Twitter), on being questioned, that this number is based on reports from the Telecom Regulator TRAI, but the fact is that the TRAI’s reporting of numbers itself needs to be looked at again.

Comparing The Data With Telecom Operator Disclosures

On the 485.6 million Internet users number, the TRAI data below from their latest quarterly performance report, for the quarter ended December 31st 2012; Pachauri used September 2012 data, for which there has since been an update. Lets compare that with data with some of the telecom operators have released in their quarterly results:


This totals to 431.23 million wireless connections, and then there are 10.35 million “Internet” (i.e. narrowband) connections, and 14.98 million broadband. That makes it 25.3 million wireline connections.

Frankly, we find these numbers hard to believe, especially since there are clear discrepancies:

1. Loop, MTNL, BSNL, Unitech and Videocon have claimed a higher data subscriber base than their active active connection base. That’s a total of at least 53.42 million extra connections being reported by them. In fact, BSNL has reported 29.38 million connections that are inactive as data subscribers, and Unitech (rather, Uninor), 19.38 million. Loop and Videocon have reported their entire connection bases as data subscribers.
2. Airtel, India’s largest telecom operator, has claimed to the TRAI that it has 163.76 data subscribers, out of its active connection base. We find it hard to believe that 95% of Airtel’s active connection base will be data subscribers. Over and above that, if we’re to believe that these are data subscribers and not data capable subscribers (explained below), there would be a clear discrepancy with the numbers that telecom operators are reporting to the TRAI: Airtel with 163.76 million to TRAI, and 41.48 million number to investors, and Vodafone with 61.01 million data subscribers to TRAI versus the 33.1 million number it gave to investors that quarter.

What is strange is that Idea and Reliance actually have shared lower numbers with the TRAI. Sistema is the only company which has quoted the exact same number at both places.

How a company reports and defines its data subscriber number makes a big difference – we’re not sure if these are daily active users, monthly active users, or that absolutely brilliant (not!) number that the IAMAI-IMRB once used of “Ever active users”, which referred to anyone who has ever used the Internet in their lifetime. Someone who clicks on a WAP link received via SMS to download a wallpaper should not be classified as an Internet user.

TRAI’s Approach To Classifying Wireless Subscribers Is Wrong

We know that numbers claimed by the TRAI have their own issues, and they don’t always get their terminology right: For example, the number of mobile connections in India are reported as mobile ‘subscribers’, which is misleading, because it attributes one connection to one subscriber, ignoring the reality of multi-SIM usage. A matter of semantics, you might say, but these things matter, and they influence decisions when people don’t look at data deeply enough.

Back in 2008, the TRAI had expanded on its definition of Wireless Internet subscribers:



In another table in the same report, this number was reported as “accessing Internet through wireless (GSM & CDMA) networks, instead of “capable of accessing”. See this. And the report is here. This detail doesn’t appear in reports anymore. They’re reported as Wireless Internet subscribers in the table. However, later in the post, (see page 46 of the December 2012 report), they’re mentioned as data capable subscribers. That nuance was lost in Pachauri’s chart.

This data finds its way into presentation decks that are used to raise money and pitch to marketers for advertising, but when they actually put in the money, the returns are nowhere close because the market isn’t there. If you repeat a number often enough, and with enough emphasis people tend to believe that. The reality is that there are only around 15 million broadband connections in the country, and the Indian government has still not met its target of 20 million broadband connections by the beginning of 2010. Wireless connectivity is not a substitute for wireline broadband.

P.s.: The data and information used in this post is from:

TRAI’s quarterly report for data subscribers for December 2012
TRAI’s quarterly report for October 2008
December 2012: Mobile connections in India
Idea Cellular Financial Results for Q3-FY13
Bharti Airtel Financial Results for Q3-FY13
Vodafone Financial Results for Q3-FY13
RCOM Financial Results for Q3-FY13
MTS Financial Results for Q4-2012

(Updates: some parts of this post have been updated for clarity)

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