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4G bandwagon: Airtel to roll out services before Reliance Jio

Set to offer high-speed data services in 44 cities by Dec

Malini Bhupta  |  Mumbai 

High-speed data users are going to be spoilt for choice, as big telecom players queue up to launch their 4G data services later this year. The country's largest telecom operator, Bharti Airtel, was on course for launch of its 4G wireless data service across 44 cities - ahead of rival Reliance Jio Infocomm - a senior company executive said.

Airtel's 4G service is now available across 20 cities and is in a trial phase in the rest of the cities. The company wants to take consumer feedback and make the requisite changes before formal launch.

The company's high-speed wireless internet service will be priced on a par with its present 3G offering. It is working on packs offering 1 GB data at Rs 250 and 2 GB at Rs 450.

  • Launch before Reliance Jio to get early-mover advantage
  • Attempts to transition its 19.5 million 3G consumers to 4G
  • Slashes 4G data prices by 83%
  • Likely to offer voice minutes free to high-use data consumers
  • 4G service to be offered on mobile phones, dongles, Wi-fi CPEs

Bharti is hoping a lot of its existing 3G customers will consider migrating to 4G, as the prices are not very different while speeds are significantly higher. For existing Airtel customers, a SIM-swap facility is available; it will enable a smooth switch to the 4G service in 10 minutes, without any disruption. The company is also looking at offering the service bundled with handsets that could be priced as low as Rs 4,000.

The 4G service will be offered not only on mobile phones but also through dongles and Wi-Fi CPEs (customer premise equipment/routers). The dongles are priced at Rs 1,500 while the CPEs cost Rs 2,500. At present, the company is offering 40 GB of 4G data for Rs 2,000 (for CPEs). Airtel is also in talks with equipment makers to offer handsets bundled with the service. It is not certain whether the handsets will have an Airtel branding or that of its partner.

Airtel has also joined hands with online retailers like Flipkart, and original equipment manufacturers like Samsung, Motorola and Xiaomi, to introduce 4G devices at affordable prices.

As the largest telecom operator, with over 19.5 million 3G users, Airtel has a captive base of high-speed data consumers and is hoping to migrate them to the 4G service.

Mobile data services are expected to grow over 80 per cent on a year-on-year basis, as competition increases and prices are driven down further. Internet users are expected to surge to 500 million by 2017, says a report by KPMG-Internet and Mobile Association of India. Of this, 314 million would be mobile internet users. Analysts expect the 3G user base in India to grow at a compound annual rate of 61.3 per cent over 2013-17.

Prices are expected to come down further towards the end of the year, with the possibility of voice being thrown in free for heavy data users. Analysts believe 4G will reduce cost-to-serve, and data pricing will likely fall 20-25 per cent in the coming months. Airtel has already slashed its pay-as-you-go rate by 83 per cent. Currently, if consumers exhaust the limit on their data plan, they pay 4 paise/10kb, which adds up to Rs 3,000/GB. Airtel has slashed this for its 4G data users to Rs 500/GB.

Bharti Airtel is Deutsche Bank Markets Research team's top pick among Asian telecom Its India mobile revenue is expected to grow at a compound annual rate of 18 per cent over FY15-18, driven mainly by 40 per cent growth in data. Compared with rival Idea Cellular, Bharti has the cash flow and spectrum to monetise exponential data growth in India, Deutsche Bank analysts believe.

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First Published: Mon, July 27 2015. 00:59 IST