Vodafone CEO Vittorio Colao on Indian telecom market

Vodafone CEO Vittorio Colao on Friday shared updates including opportunities — mobile data and 3G — and challenges — tax issue — in the Indian telecom market.

Vodafone, which reported 10.3 percent growth in service revenue driven by customer growth, data usage and voice pricing, will continue to bet on 3G roll outs. It’s positive about the recent regulatory approval for 3G roaming.

However, Vodafone is not fully concerned about the pace of growth that slowed in Q1 compared to Q4, which was expected and reflected the lapping of last year’s voice price increases.

Mobile customers increased by 3.3 million during the quarter to 170 million.

Vodafone said data usage increased 102 percent during the quarter. 3G grew at 185 percent, 2G at 67 percent, primarily driven by 28 percent increase in active data users and a 46 percent surge in the data usage per customer.

“We have 57 million data customers including 10 million 3G customers, with over 29 million smartphone users, representing a 17 percent penetration of the total customer base. Data accounts for 11 percent of service revenue compared to 7 percent a year ago,” Colao added.

Vodafone 3G

The telecom operator aims to have 95 percent 3G outdoor coverage in targeted urban areas over the next three years. It has taken the 3G coverage on this footprint to 89 percent.

As part of Project Spring program, Vodafone deployed nearly 2,300 new 3G sites.

Vodafone is gearing up for forthcoming spectrum auction. “We anticipate another spectrum auction later this fiscal year,” Colao said.

The company soon will have 150 Vodafone branded large format stores focused in the urban areas to provide a higher level of service to small businesses and consumers.

Vodafone M-Pesa service has 66,000 sales agents nationwide and 1.5 million registered users, of which around 300,000 are active.

Vodafone India


On potential regulatory changes

He said the general mood is clearly positive because the early statements and moves of the BJP government seem to be pro-business.

“I think again in India there is a very strong awareness that reigniting growth or re-accelerating growth in the country and having more stable pro infrastructure policies is essential for the future of the country. I am seeing a constructive approach to regulation as well,” Colao added.

On Vodafone tax controversy

Colao said the BJP government has indicated the current processes will be on for the past cases. “For our processes in arbitration, we have appointed our arbitrator. They have appointed theirs. We will have to appoint the joint one and then this story will take its own course.”