Bharti Airtel overtakes Vodafone Idea in mobile broadband

Bharti Airtel overtook the combined Vodafone-Idea entity in mobile broadband users in August due to a steep, 20% fall in Vodafone India’s wireless broadband users in the month.

The sharp decline of 12.5 mln mobile broadband users on Vodafone’s network in August was at odds from the usual course, when the company used to add around 1-2 mln 3G+4G data users every month.

Vodafone (pre-merger) had 63.8 mln 3G and 4G data users at the end of July, which fell sharply to 51.25 mln at the end of August, according to numbers from the Telecom Regulatory Authority of India.

The August decline has wiped out the growth achieved in Vodafone India’s mobile broadband user base in the previous eight months.

UPDATE: A Vodafone Idea spokesperson said the dip was caused by a change in the definition of who constituted a mobile broadband user. “There was a change in definition of broadband users sometime back,” she said. “Therefore it seems lower than previous months.” Only if a subscriber used a certain amount of data would he be considered a ‘mobile broadband subscriber’ from August, according to the clarification.

In the same month, none of the other players in the market reported declines, including its merger partner Idea Cellular.

In the month, Idea Cellular’s mobile broadband base increased to 44.24 mln from 43.52 mln. Similarly, Bharti Airtel’s mobile broadband subscriber numbers increased from 95.33 in July to 96.12 during the month.

However, the biggest gainer was Reliance Jio, which saw its mobile broadband users zoom to 239.23 mln in August from 227.05 mln in July — a jump of nearly 12 mln, or 15 times that of Bharti Airtel.

Notably, even as Vodafone’s mobile broadband user base fell by 12.5 mln in August, the company’s active mobile subscriber base increased by 2 mln.

This suggests that it is not a simple case of subscribers abandoning the network altogether, but could be something intricate like users not renewing their data packs while continuing to remain on the network or relying more on other operators like Jio for data.

NETWORK ISSUES?

While the exact reason for the decline was not apparent, at least two analysts felt that Vodafone-Idea may be losing subscribers due to integration-related network quality issues.

Vodafone and Idea have been in the process of unifying their networks for the last six months as part of a corporate merger.

Analysts Aliasgar Shakir and Hafeez Patel of Motilal Oswal pointed out that Vodafone and Idea have been losing ‘active subscribers’ too for the previous three-four months.

According to their numbers, Vodafone lost 2.5 mln active subscribers in May, 1.1 mln in June and 0.8 mln in July, before turning positive in August with a net addition of 1.3 mln.

Idea lost 2.4 mln in May, 2.3 mln in June, 2 mln in July and 2.5 mln in August — a total loss of around 9 mln in four months.

Taken together, Vodafone and Idea have lost around 12 mln (1.2 cr) active users between May and August.

In contrast, during the same period, Jio has added 30 mln (3 cr) active users and Bharti Airtel 13 mln.

“Vodafone-Idea continued to lose active subscribers for the fourth consecutive
month, down 1.3m (albeit, lower than the 2.3m drop in July 2018). The loss reported
by the merged company was due to its deteriorating network quality which could
possibly be on account of network integration issues,” the Motilal Oswal analysts said in a note to clients.

The poor additions of threatens to bring down the combined market share of Vodafone Idea below the 40% mark — perhaps for the first time ever.

In May, Vodafone and Idea could claim a share of 42.2% of all active mobile subscribers in India, which has fallen to 40.2% as of end-August.

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