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Airtel Crosses 50M Data Connections; VAS & Messaging Down in Q2-FY14


Airtel India has reported 50.631 million mobile Internet connections, up 8.69% quarter-on-quarter (QoQ), adding 4.07 million data connections in all. This is also a significant quarter for Airtel for another reason:  VAS and messaging declined to 6.69% of total revenue during the quarter, from 8.24% last quarter; in comparison, data revenues accounted for 9.2% of total revenues, and this is the first quarter were Data has crossed VAS-and-messaging. This is undoubtedly initiated by the decline in VAS revenues due to TRAI’s double confirmation regime, which also impacted Idea Cellular’s VAS and messaging revenues. This impacted Airtel’s non voice revenues, which declined to 16.54% of total revenues, from 17.35% of total revenues.

Interestingly, Airtel added 2.828 million 2G connections (compared with 2.7 million last quarter), and 1.219 million 3G connections (compared with 0.4 million last quarter. So, is the tide turning – are more people opting for 3G now? We’re not sure of how Airtel accounts for users that transition to 3G, but given that these are net adds, it is likely that they’re shown as a decrease in the 2G data connections base, and an increase in 3G. The numbers:

– 4.047 million mobile Internet connections added during the quarter, as compared to 3.09 million last quarter, and 2.81 million the quarter before.
– 50.631 million mobile Internet connections, up 8.69% from 46.58 million last quarter.
– 8.01 million 3G connections, up 1.219 million from 6.795 million 3G connections last quarter.
– 42.61 million 2G connections, up 2.8 million from 37.788 million 2G connections last quarter.
– Around 26.17% of Airtel’s overall mobile connections base is using the mobile Internet, as compared to 24.4% last quarter.
– Data usage: 33,630 million MBs of data transferred, up 23% QoQ.
– Data ARPU increased 15% QoQ to Rs 69.79 per data user, up from Rs 62.83 last quarter.
– Data usage per data customer was up to 230.64 MB per data connections, up 8% from 202.89 last quarter.
– Data realization per MB was Rs 0.3026, down from Rs 0.3097 last quarter.
– Data as a percentage of total revenue was up to 9.20%, up from 7.4% last quarter.

The company did not disclose the number of 4G subscribers, if there are actually any, although it noted that Airtel 4G is currently present in four markets.

Update: Data realization rate has declined. An earlier version of this post incorrectly stated that it had increased. 

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