Telcos to expand rural bases in Punjab

Cellular service providers in Punjab are focusing on rural locations to expand their presence as the mobile phone density in these areas is lower than that in urban areas.This will not only help them in adding new customers but also strengthen rural connectivity.

Punjab’s teledensity, at 47 per cent, is the higher among states and more than twice the national average of 20 per cent. While one out of every five Indians has a telephone (fixed line and mobile combined) nationally, the figure in the state goes up to almost one out of two people, with majority of them mobile users. Though the mobile penetration in Punjab is high, mobile adoption is mostly concentrated in the urban areas, whereas almost 66 per cent of the population is in the rural areas. The teledensity in rural Punjab is around 20 per cent compared to 80 per cent in the urban areas.

Idea Cellular Ltd, which has acquired Spice Communications, recently announced that it will specifically target rural areas as there is low mobile density of 20 per cent. At present, Idea covers 10,000 towns and villages in the state and plans to further expand its presence by adding new cell sites.

The company will add an additional 1,000 cell sites by March 2009 to reduce congestion and for better connectivity.

“The addition of 1,000 cell sites will take the tally to 3,500,” said a source.

India’s biggest mobile operator Airtel has reached out to about 11,300 villages out of a total 12,500 in Punjab. It is determined to enter the remaining villages as well. Except for border villages, where mobile telephony is not permitted because of security reasons, and some very remote and small villages, Airtel announced recently that its services would be available all over the rural Punjab soon. Last year, out of the budget of $3.5 billion, one-third was invested in smaller towns and villages across India.

Even state-owned BSNL has a significant presence in rural Punjab and plans to add new cell sites. CDMA player Tata Teleservices covers about 356 towns in Punjab and has 579 cell sites. Earlier, Rajeev Narayan, vice-president (corporate affairs) of the company, said, “we would invest around Rs 170 crore in Punjab in this financial year.”

Punjab has a total subscriber base of about 10 million as of November 2008 and registered 2.5 per cent growth over the previous month. According to data released by the Cellular Operators Association of India (COAI), up to November 2008, Airtel is the frontrunner with has a subscriber base of 3.55 million, followed by BSNL (2.27 million), Spice (2.25 million), and Vodafone which has a subscriber base of 1.94 million.

It is worth noting that the cellular telephony in the state was rolled out in June 1997 by Spice Communication(now Idea Cellular). Later on to join the bandwagon was Airtel(February, 2002) followed by BSNL and Hutch(now Vodafone). The preferred technology among mobile users seems GSM with more than 69 per cent mobile users opting for it. Besides GSM players, the state has three CDMA players, Reliance, Tata Teleservices and HFCL Connect.