Loss-making state-owned telecom service provider Bharat Sanchar Nigam, which once held preeminent position as a pan-India operator with reach across the country, has now been overtaken by private operators, who have spread their reach with better tariffs and marketing skills.
Things have come to a point where the one area it reigned for quite long rural India is also no longer its domain. Private operators were slow to go into the interiors seeing only low paying customers there and BSNL’s supremacy in the interiors of the country was the strongest argument against its closure.
But the PSU, which has been making losses for more than five years now, has been beaten in rural India too by private operators, who have a much larger subscriber base in these areas. In fact, BSNL has lost more than half of its wireless market share in rural areas in the last 10 years to private operators.
As per data put out by Telecom Regulatory Authority of India (Trai), BSNL s wireless market share in rural areas stood at 6.82% at the end of December 2018 against 15.36% at the end of June 2009.
Even Reliance Jio, which launched its services in September 2016, has a higher rural market share than BSNL s at 19.01%.
Analysts point to the usual problems that plague PSUs slow decision making, bloated staff with high wage bill but poorly trained to operate in a competitive market place, and lack of timely expansion and upgrade of network. For instance, the company got more than a year s head start in launching 3G services compared to private players because it was allocated spectrum earlier, but it could not cash in on the advantage.
Slowly, as private operators started venturing into rural areas with teledensity saturating in urban areas, they devised innovative packages for these markets too, and BSNL was not able to defend its turf.
TV Ramachandran, president, Broadband India Forum, feels one reason for the decline in rural market share of BSNL in recent times could be lack of 4G spectrum as people in rural areas also want access to high-speed internet. However, as the decline has been a consistent thing for the past 10 years, better customer experience by private operators could also be the reason for their increased share, he added. Telecom analyst Mahesh Uppal concurs. BSNL is up against private operators which have got the latest infrastructure and technology. Unfortunately, there are not enough revenues to protect or expect for the state-run firm in rural areas. This makes it difficult to justify sufficient investments that will allow it to compete with the new players, Uppal said.
Today, Vodafone Idea is the leader in rural areas with a market share of 41.76%, followed by Bharti Airtel at 31.91%. In terms of percentage of rural subscribers in overall user base, BSNL ranks after the three private operators, which means right at the bottom. Vodafone Idea has 52.71% rural subscribers in its user base, followed by Bharti Airtel with 49.56% and Reliance Jio at 35.87%. The share of rural subscribers in BSNL s overall user base stands at 31.51%.
The country’s overall rural wireless subscriber base increased to 528.48 million at the end of December 2018 compared to 521.59 million at the end of September 2018. The urban wireless subscriber base though declined marginally to 647.52 million from 647.70 million during the reported period. On the back of increase in rural subscribers, the percentage share of rural users increased to 44.94% in the overall wireless subscriber base.