Archives by Tag 'airtel-3g'
Non-voice as a percentage of revenue has grown from 8-9% to 14-16% for Airtel and Idea over the last 21 quarters. This, however, is lower than market expectations. 3G Data Rates across most circles in India have seen steep cuts in rates recently, still remains higher than 2G rates. Also, the pricing of good quality 3G enabled handsets remains a deterrent in the explosion of data.
Idea scores over Airtel, having increased its contribution from 12.1% to 14.5% in the last four quarters. Idea’s non-voice revenue growth had surged 11-13% sequentially in the three quarters before F1Q13 although we have seen some weakness in the last quarter due to weakening data revenue growth.
The Following Chart Shows Indian Telecom’s Wireless Non-Voice Revenues in Last 3 Years Read the rest of this entry »
Since the launch of 3G in India, 3G data tariffs in India are down by a further 60-75% across various usage buckets. In India data is sold mostly through add-on plans rather than as bundled plans with voice making it easier for subscribers to select the right plans for their usage. For the top three operators by revenue (Airtel, Vodafone and Idea) data tariffs remain largely flat across volume levels. Idea’s lack of 3G spectrum in key data markets (like Delhi and Mumbai), which forces it to lease capacity from Airtel / Vodafone, prevents it from pricing data at a discount to these two operators.
Airtel offers the lowest 3G data tariffs. Airtel took the lead in above mentioned recent 3G data tariff cuts. Airtel’s 3G data price aggression could be driven by the appearance of 4G TD-LTE over the horizon – With 3G data usage yet to take off and Bharti’s own recent launch of TD-LTE in two circles showing 4G as a credible threat, the company could be aiming to make the most of the time window left before Reliance Infotel Broadband launches 4G services. Airtel has already realigned 3G tariffs closer to 4G.
Monthly ARPUs for various usage scenarios in this report are largely similar for the three operators. Flattish data pricing across usage levels could allow Indian operators to see higher ARPUs at higher usage levels. More importantly, Indian operators have so far resisted offering unlimited 3G plans (though some of the smaller operators like Aircel broke away from this discipline recently).
3G Data ARPU and Margins – What is the Impact ?
Airtel’s smallest 3G data plan comes at Rs101 (US$1.83) per month for Read the rest of this entry »
Airtel and other old telecom players Idea / Vodafone have embarked on a strategy to push under-utilized 3G networks. They are probably pulling a business strategy leaf out of developed markets where there is no disparity between EDGE and 3G-based data pricing.
One interesting thing we observed is 2.5G (EDGE) data uptake has started to gain traction given the increased subscriber awareness due to heavy 3G promotion. One key reason behind this could be the disparity between per MB rates on EDGE vs 3G. The company has been trying to wean away subscribers from 3G by reducing the perceived gap i.e. they first slashed 3G rates by 50% and followed it up by increasing EDGE rates by 100%. The operators will need to further reduce this arbitrage to help 3G gain traction, in our opinion.
Airtel 3G active users is at 27% of the total subscriber base and it witnesses a 100% m-o-m increase in dongle sales. Read the rest of this entry »