3G users key for Airtel, Vodafone

With Bharti Airtel launching its 3G services in Mumbai, the telecom operator is looking at multiplying its data subscribers in the 13 3G circles and over 40 cities, by March 2011.

“Data subscribers comprise about 13.5 per cent of revenues on Saturday and broadband penetration in the country hovers at under one per cent. It is only logical to assume that 3G on mobile will be the first internet experience in 2011,” said Atul Bindal, president (mobile services), Bharti Airtel, who is expectant to grow its subscriber volumes, specifically in the pre-paid segment.

With data becoming critical to operator’s revenues, metros like Mumbai that boast of data penetration of about 20 per cent among the subscribers, remain a critical hotbed. Bharti, which, according to Telecom Regulatory Authority of India (TRAI) data, added about 33 lakh subscribers in Mumbai in January, has launched 3G data plans starting at Rs 8 onwards. Bindal believes that most subscribers will experiment with 3G trial plans before adopting services.

“Mumbai is the 11th city where we have unveiled 3G networks, but are hopeful of widening the enterprise customer base here,” he said.

Vodafone, which added 56 lakh subscribers in Mumbai in January, said it has set up the experience zones at stores across cities and is inviting customers to experience the same. “The commercial roll out of the services across all our circles will be announced shortly. Vodafone 3G services will be available to all our customers by the end of this quarter,” said a spokesperson from Vodafone Essar.

Meanwhile, Vodafone with a 16 per cent market share, has also announced its plans to launch 3G services in Mumbai in the next 15 days. “Over 100,000 customers have already started using our 3G services and are providing valuable feedback, which we are using to enhance the customer experience,” said an official company spokesperson, Vodafone Essar. The company is currently offering 3G services on trial to selected consumer base.

Bharti Airtel, which according to TRAI data commands over 20 per cent of the total telecom subscriber base, has already added around six lakh 3G users to its kitty. This number includes its existing 3G users. The company has already launched in the service in Bangalore, Chennai, Coimbatore, Mysore, Manipal, Udupi, Jaipur and Delhi NCR.

Both Airtel and Vodafone are launching their 3G services much later than Tata DOCOMO and Reliance Communications, which launched 3G service last year. However, experts opine that bigger telecom companies are likely to get a bigger share of the 3G subscribers as they own high average revenue per user (ARPU) customers, who are more likely to sample premium services like 3G.

Analysts, Business Standard spoke to, claimed that a significant portion of Bharti’s subscriber base uses 3G enabled handsets. “This proportion, according to our estimates, is 12 per cent and 10 per cent of the subscriber base in the top-50 cities and top-100 cities, respectively,” said an analyst. Analysts also believe that it may be possible to expect data (especially 3G) revenues to contribute 30 per cent of Airtel’s total revenues in two years (with voice revenues growing at a modest rate).