- Airtel expects the roll-out of 5G services to provide a boost to business in the short term.
- With 40% new data subscribers from rural India, Airtel is poised to capitalize on this opportunity by rolling out new sites in key areas.
- ARPU rises to ₹190 as more users migrate from feature phones to smartphones.
After a stellar performance in the September quarter, in which Airtel’s consolidated revenues grew 5.3% to 34,527 crore and operating margins rose to 51.8%, the company’s CEO said,
The telco is betting that 4G consumers will migrate to 5G seamlessly, almost at the touch of a button. The company has already taken on the mantle of delivering industry-leading growth in its mobile business, which grew 4% consecutively and also captured the numero uno position in the postpaid segment. During the September quarter, Airtel added 300,000 postpaid customers and became a decisive leader in the category.
Even as the company plays a portfolio strategy, offering differentiated services across segments and regions, the mobile company reported industry-leading growth. India’s mobile business experienced 4% sequential revenue growth driven by up-trading and ongoing upgrades from feature phones to smartphones. Also helping the revenue growth was the flexibility users had to purchase additional data on any day within the subscription cycle when their allowance ran out. This increased the ARPU from 183 to 190. This was achieved thanks to 5 Mn 4G net additions – a recovery from the previous quarter, explains Vittal.
Vittal said the company had launched 5G plus in key cities, as it had done with its 4G services in 2015. By March 2024, Airtel’s 5G services would be available in all cities in urban India. Said Vittal: “As the network starts to build, we will see a significant part of our existing data traffic on 4G move to Airtel 5G plus. This is important because we can gradually move more and more spectrum to 5G at the touch of a button.” move.” Airtel believes it may be early days for some of 5G’s business use cases, but there is a “serious short-term opportunity to increase market share and gain disproportionately high-value customers leveraging the power of 5G”.
He added that as one of its rivals found itself in a financially difficult situation, “the time is right for Airtel to move forward and be the decisively most ambitious brand in India. With this we hope in particular in the postpaid market.” segment to take a further lead.”
For those consumers looking to migrate to 5G, Airtel promises the next generation of data services would work seamlessly across all devices. All Xiaomi, Oppo, Vivo and Real Me devices are now ready. Samsung and OnePlus will also be ready within a few weeks, as will Apple for Airtel’s 5G services. However, Vittal said: “This cannot be said with alternative technologies where many devices will provide an inferior experience or simply won’t work on 5G. A second benefit we provide is a superior experience. With our anchor band riding on the underlying 4G layer , our 5G band spans an additional 100 meters to deliver a convincingly superior experience. The third benefit is that our solution is more energy and carbon efficient for India.”
It’s not just 5G that is expected to act as a growth lever for Airtel. The company also sees opportunities in rural markets, as 40% of new data customers come from the hinterland. Vittal explains: “We now see that more than 40% of the 4G net gains in the sector come from rural areas and we believe the time is right to close a substantial part of the coverage gap in mobile by the leading player in the industry.”
The company is applying lessons learned in the past to shape its strategy in rural India. Airtel uses data science models to determine exactly where to go. It combines field personnel and data science to anticipate demand factors. And to drive this growth, Airtel has designed and built lower cost sites that allow us to expand profitably.