First, Airtel is making Rs 60,000 crore investment in three years to enhance customer experience. The investment program called Project Leap will enhance Airtel’s mobile data customer base and revenue.
Second, Airtel has 157,000 cell sites for 3G and 4G networks. Out of 157,000 sites, 69 percent are mobile broadband enabled.
Airtel has the largest 3G and 4G network in India. National footprint would allow Airtel to reduce dependency on ICR arrangements, and build a more cost optimized network.
3G and 4G rollout along with focused customer awareness campaigns have resulted in 11.7 percent increase in Data ARPU of 202.
Airtel says its data ARPU is over 45 percent higher than voice ARPUs.
“We firmly believe that we are still at a very nascent stage of data revenue pool development. Data now contributes 23.7 percent of mobile revenues as against 19.2 percent in the corresponding quarter last year,” said Bharti Airtel India CEO Gopal Vittal during a recent discussion with analysts.
“With additional 4G spectrum and a pan-India 4G presence, we would look to keep up our investments on data to drive growth,” said Gopal Vittal.
Challenges in mobile broadband
Airtel’s India CEO admitted that the company is concerned about the slowdown in penetration of data over the last few months.
According to Gopal Vittal, there are barriers in expanding the mobile data customer base. Airtel had 36 million mobile data customers in Q1.
The affordability of smartphone is one of the main barriers. Airtel India CEO feels that smartphones at Rs 3,000 are still not affordable for many Indians.
Educating customers on the need for the internet and how to use the internet is an important aspect of Airtel’s data growth strategy. “We are in the process of doing a couple of pilots and we will try and work out how to scale this,” said Gopal Vittal.
Reliance Jio is testing VoLTE. Bharti Airtel is currently not deploying VoLTE. “Our experience from around the world suggests that when you do not have sub-GHz band then typically VoLTE does not work as well so we will have to look at that a little more carefully,” said Gopal Vittal.
The company said the availability of Wi-Fi will not eat into Airtel’s revenue from mobile Internet business. This is primarily because of the poor infrastructure of wireline business and inadequate coverage in India.