wordpress blog stats
Connect with us

Hi, what are you looking for?

, ,

Airtel says higher ARPU needed to sustain telecom industry; Jio entry crushed postpaid business


Bharti Airtel CEO Gopal Vittal, in a call with investors today, said that current Average Revenue Per User (ARPU) rates were unsustainable for the telecom market, and said he hoped for intervention from the Telecom Regulatory Authority of India (TRAI) to set floor pricing. He said that in the coming months, Airtel hoped to get its ARPU up from Rs 154 to Rs 200. Since the company’s financial results have only been released until March 31, it is not clear what the full impact of the COVID-19 pandemic and increased demand for telecommunications services has been.

  • How ARPU is split up between subscriber types: For feature phone customers without need for data or capacity to pay for unlimited calling, ARPU is in the Rs 50 ballpark. For 4G our entry point is at Rs 299, so our ARPU is ahead of 200 there. In postpaid entry plan is Rs 399, and we have plans at Rs 499. So postpaid is substantially higher,” Vittal said.
  • On home broadband during the lockdown: We are excited about the home broadband market as India is an underserved market. What we’ve seen in the recent few weeks is a massive surge in latent demand for home broadband. During the lockdown there has been a lot of home broadband demand. We have an innovative model we were experimenting with, working with local cable operators for the last mile, and using a digital model to access more cities and expand the scale of our broadband business. I think that’s already out in 13 cities, with good traction,” he added. Since home broadband connections are likely to be concentrated in April and this month, the extent of demand for it is not known.
  • On impact of tariff hike and slowdown in recharges: I think we saw in the March quarter, a significant impact on account of the tariff hike, and strong 4G growth. If COVID-19 hadn’t shut down our business, it would have been better. Our definition of a revenue earning customer is someone who has recharged in the last 30 days. On COVID, on mobile, we see postpaid by and large intact, and the 4G customer base intact. In the bottom end, people who recharge once every 45-50 days have been impacted. We’ve seen some positive surprise on broadband and B2B customers expanding capacity. Every week is getting better. The jolt from March has gotten better since customers are finding new ways to recharge. We’re activating digital channels too.”
  • Why postpaid hasn’t taken off in India: “There’s no reason it should be this small in India. The only reason is arbitrage in pricing between prepaid and postpaid, before prepaid pricing crashed. Postpaid was growing nicely before [Jio’s entry] and this led to compression in prepaid pricing, fueling reduction in postpaid take-up.”
  • On emulating Jio–Facebook’s platform-based approach: “Our strategy is what it is. Obviously technology is at the heart of it. We leverage technology and we have a large pool of talent, across product, engineering, and data science. If you ask me, are we a tech company, then yes, telco, yes. We’re marrying telecom and technology to address customer needs.”

Q4’20 Results

Revenue: Rs 17,438 crore (14.4% increase YoY)
Net loss: Rs 5,237 crore
ARPU: Rs 154 vs Rs 123 in Q4’19
Mobile data traffic: 6,010 petabtyes (increase of 74.2% YoY)
4G data customers: 136.3 Mn, up 57.0% YoY

Earnings Press Release | Results

Written By

I cover the digital content ecosystem and telecom for MediaNama.

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.



The Delhi High Court should quash the government's order to block Tanul Thakur's website in light of the Shreya Singhal verdict by the Supreme...


Releasing the policy is akin to putting the proverbial 'cart before the horse'.


The industry's growth is being weighed down by taxation and legal uncertainty.


Due to the scale of regulatory and technical challenges, transparency reporting under the IT Rules has gotten off to a rocky start.


Here are possible reasons why Indians are not generating significant IAP revenues despite our download share crossing 30%.

You May Also Like


Google has released a Google Travel Trends Report which states that branded budget hotel search queries grew 179% year over year (YOY) in India, in...


135 job openings in over 60 companies are listed at our free Digital and Mobile Job Board: If you’re looking for a job, or...


Rajesh Kumar* doesn’t have many enemies in life. But, Uber, for which he drives a cab everyday, is starting to look like one, he...


By Aroon Deep and Aditya Chunduru You’re reading it here first: Twitter has complied with government requests to censor 52 tweets that mostly criticised...

MediaNama is the premier source of information and analysis on Technology Policy in India. More about MediaNama, and contact information, here.

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ

Subscribe to our daily newsletter
Your email address:*
Please enter all required fields Click to hide
Correct invalid entries Click to hide

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ