Pricing not differentiator in 4G: Vodafone CEO

To spend around Rs 8,000 crore this year on network expansion and upgradation

With a data price war begun by Mukesh Ambani with the announcement of fourth-generation technology (4G) services by Reliance Jio, Vodafone India chief executive Sunil Sood said pricing would not be a differentiator. Sood announced Vodafone’s 4G foray into Gujarat with its launch in this city on the 1,800 MHz band, to be followed by 206 other cities by year-end.

“Pricing is the easiest thing to change. It is not a barrier to entry. Pricing is not a differentiator for anybody (in 4G). We will continue to remain competitive and provide superior customer service,” he said.

While Reliance Jio is offering 10 GB 4G data and 20 GB free Wi-Fi usage for Rs 999, Vodafone India says it offers 20GB 4G data at Rs 998 for packs greater than 1 GB. Apart from the competitive pricing, the operator is also offering free Vodafone to Vodafone voice calls for a limited period in Gujarat.

Vodafone customers will also be able to avail a three-month access to free TV, movies and videos on Vodafone Play, as part of the 4G subscription.

Gujarat is the eighth telecom circle after Kerala, Karnataka, Kolkata, Delhi/NCR, Mumbai, Haryana and UP East where Vodafone India has launched 4G services. By year-end, says Sood, they’d launch Vodafone SuperNet 4G services across 1,000 towns. Including West Bengal, the nine circles together contribute to just below 70 per cent of Vodafone India’s data revenue.

Vodafone India spent around Rs 8,000 crore nationally last year and will invest a similar amount this year for network expansion and upgradation, continuing on its 4G foray, said Sood. He put the company’s total investment so far at Rs 115,500 crore.

Moreover, the company is also gearing up for the next round of bidding for the spectrum auctions in later this month. "We will participate in the auction," said Sood.

For the first quarter of current financial year, total service revenue stood at Rs 11,412 crore, 6.4% growth over same period last year.

In Gujarat, the operator spent around Rs 541 crore on expansion, modernisation and building more technology and energy efficient network.

According to Jayesh Gadia Business Head-Gujarat, Vodafone India, similar amount of investment would be made this year again in the Gujarat circle.

"Gujarat is a strong leadership market for Vodafone India and as the leading telecom service provider, our over 19.5 million customers have a lot to look forward to. Beginning with key business and residential corridors of Surat, we will soon expand our Vodafone SuperNet 4G services across the entire state in a phased manner," Gadia said.

Apparently, 4G-enabled phone owners form less than 10% of the total Vodafone subscribers who own smartphones.

"Around 30% of our customers do not have data enabled phones, 40% have 2G enabled phones and 30% own smartphones. Of these, less than 10% would be 4G-enabled smartphones," Sood said, while adding that the operator anticipates 4G services being utilised by its top end subscribers the most.