Vodafone-Idea might be working on a series of low-cost 4G phones: Report
Airtel gained 0.6 million subscribers, while Jio's share went up to 13 percent.
India’s telecom sector is going through a phase of intense competition, and consolidation. The disruption began last September with the launch of Reliance Jio that lured Indians with what they cherish the most — freebies. In less than a year, Jio has gained 123 million subscribers, and a 13 percent market share. It is adding more subscribers than the rest of the telecom industry put together. Two of its peers, Vodafone (18 percent), and Idea Cellular (16 percent) are at arm’s length. Given the rate at which both incumbents are losing subscribers, Jio wouldn’t take long to surpass them.
Latest data from the Cellular Operators Association of India (COAI) reveals that Vodafone and Idea Cellular (which have merged now) collectively lost 3.7 million subscribers last month. Idea lost over 2.3 million subscribers, while Vodafone is lighter by 1.38 million. The merger is currently awaiting clearance from market regulators SEBI, and the Competition Commission of India (CCI). Once cleared, it will result in the formation of the country’s largest telecom operator with over 400 million subscribers, and a 40 percent market share. Both companies are also scouting for a candidate to lead the merged entity. ALSO READ: Idea Cellular MD Himanshu Kapania tipped to lead merged entity with Vodafone: Report
While Vodafone and Idea realign their businesses, Bharti Airtel continues to lead the domestic telecom market. In July, it added 0.6 million subscribers to take its overall tally to 281 million. Airtel owns close to 30 percent of the telecom market, and also accounts for the second-largest active subscriber base. Vodafone-Idea had over 404 million subscribers at the end of the month. Smaller operators like Aircel and Telenor are also losing subscribers as Indians are gravitating towards the more attractively priced Jio. ALSO READ: Reliance Jio records over 6 million new subscribers ahead of JioPhone launch
Despite increased action, the telecom industry suffers from a debt amounting to Rs 4.5 lakh crore. Jio’s super-subsidized offerings have hit industry ARPUs significantly. They are at a five-year low of Rs 150; revenues of incumbents have fallen by 10 percent year-on-year, a CRISIL report estimated. All operators have been compelled to slash rates to stand up to the Jio juggernaut. The average cost of mobile data too has declined 48 percent in just a year, with 1GB of data now costing less than $2 across the board. The annual revenue of the industry declined for the first time since 2008-09, and is likely to go down further.