Airtel to sacrifice 3G to focus on 4G, customers to be shifted to top spectrum

Chennai: Shortly after being dethroned by Reliance Jio and becoming the number two operator in terms of subscriber base, Bharti Airtel is said to have decided to completely shut down its 3G network by the end of the current financial year.

The telco will utilise the spectrum in the band to offer 4G services, while existing 3G customers will be shifted to the 4G network, according to reports.

Talking to analysts on a conference call a day after declaring its first quarter results, Gopal Vittal, MD and CEO, Bharti Airtel (India and South Asia), said that by September this year, 3G will be shut down in six to seven circles, and all the remaining circles will be done by March next year.

The company had already shut down its 3G network in Kolkata in June this year.

“Going forward, Airtel will offer 2G and 4G services and shut down 3G completely,” Vittal said, adding that the company will be utilising most of its airwaves for offering 4G services and just about 5-8 Mhz spectrum in each circle will be used for offering 2G services.

According to reports, Airtel’s 2G customers constitute around 70 per cent of its user base while the rest are 3G and 4G.

The current scenario is termed to be the direct causality of Jio’s affinity towards cheaper than usual data tariffs along with offering free voice calls.

Despite being demoted to second spot, Airtel is growing its revenue in the country. This can be attributed to the firm bringing in minimum monthly recharge plans last November and launching its loyalty programme for prepaid users called Airtel Thanks in May.

In fact, Airtel has managed to post the highest average revenue per user across the three telcos at Rs 129, beating Jio at Rs 122 and Vodafone Idea at Rs 108.

“We are happy to lose subscribers who don’t pay us money,” Gopal Vittal said in the post-earnings call.

However, Airtel reported a net loss of Rs 2,866 crore in the April-June quarter, its first in 14 years. It said the loss was largely the result of a one-time exceptional expenditure.

The telco’s revenue from India wireless business grew 4.1 per cent year-on-year to Rs 10,724 crore.

In comparison, Vodafone Idea posted a net loss of Rs 4,873.9 crore, while its revenue fell 4.3 per cent from the preceding quarter to Rs 11,269.9 crore in the June quarter.

Fact sheet
* Airtel’s data consumption per user surpassed Jio for the second consecutive quarter. The firm’s average data usage per month was 11.9 GB compared with Jio’s 11.4 GB, by end of June quarter.

* The firm added 8.4 million customers taking its 4G user base to 95 million and overall data customer base to 120 million.

* The company is also exploring carrier billing and advertisement on its over-the-top (OTT) apps to increase revenues.

NT Bureau