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“4G and 2G networks will coexist, but 3G will shut down faster”: Airtel India CEO

“India will get to a situation where 4G and 2G networks will coexist for a while. 3G will probably shut down faster,” Airtel India CEO Gopal Vittal said in response to question whether 3G would be completely phased out in India. During a call with analysts for the quarter ended June 2017, Vittal said that 3G ecosystem will continue to see lower adoption and move to a complete shutdown in India, faster than other parts of the world.

According to Vittal, 3G will be completely phased in India but the 2G standard will see some usage because:

  • 2G usage will remain strong due to feature phones: “India still has about 30 million to 35 million of feature phones being shipped out every quarter. The installed base of feature phones in India is still about 70%. That is unlikely to change in a hurry. It will change over time. But even in advanced markets, you still see that 2G continues to work,” Vittal added.
  • Increasing 4G smartphone device penetration: “All smartphones that are now coming in are coming with a 4G as well as a 3G chipset,” Vittal pointed out during the call. At least 7 out of 10 smartphones shipped by offline vendors in Q3 2016 were 4G-enabled, and 9 out of 10 smartphones sold by online vendors had 4G, according to market research firm IDC.
  • 4G is a better technology when compared to 3G: “And as you know, 4G is spectrally more efficient. It has better delivery speeds, so the world will go to 4G,” he added during the call. Most 4G smartphones being sold in supports VoLTE, but as of now, only Jio provides VoLTE calls to its users and there are issues with compatibility. Airtel plans to launch VoLTE in the next 6-9 months.

3G standard will still exist until VoLTE sees more adoption

Although users might stop purchasing 3G data, and move on to faster speeds, Vittal pointed out that a full shutdown of 3G will be completed only when the VoLTE ecosystem grows in India. “Currently, 3G is also carrying voice, and so with the growth of VoLTE, what you will find is actually 3G networks getting released. And at some stage, yes, you may be right that there could be a need for shutting down 3G networks and actually moving the spectrum on to 4G bands,” he added during the call.

“Most of the hardware that we have bought [for 3G] are also 4G compatible. So we click it on through the software, and so at the click of a button, we can actually move from the 3G bands to the 4G band as the traffic diminishes,” Vittal said.

Airtel will focus on adding users on the primary 4G SIM slot: CEO Vittal

The challenge for Airtel is to add more data users in the mobile broadband segment which currently includes both 3G+4G users. But Vittal said that most dual SIM 4G devices support LTE only on the primary slot, while the secondary slot is meant for 2G. For the quarter ended June 2017, Airtel mobile broadband base stood to 48.9 million up from 42.7 million in the previous quarter. It’s biggest 4G competitor Jio on the hand claims to have 100 million paying users.

 “One of the things that we track very carefully is our share of 4G devices, we also look at getting the SIMs in the right SIM slot, which is the primary slot, which has a 4G, 3G radio, bulk of the devices have 4G, 3G radio on 1 slot and the 2G radio on the second slot. So we do not really celebrate if we get it on the secondary slot, which is a 2G slot, we celebrate it if we get it on the right slot,” Vittal said during the call.

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