Regulatory Authority of India (Trai) has put out data that shows Airtel gained one million subscribers in September and its market share increased to 23.8 per cent. Vodafone’s market share remained unchanged at 17.5 per cent although it lost 0.7 million subscribers. Idea Cellular lost 0.9 million subscribers in September yet its market share remained stable at 16.1 per cent. Smaller operators registered a cumulative net loss of 8.1 million subscribers during the month.
“The strong growth in subscribers for Reliance Jio, with incumbents holding on to their market shares, supports our thesis that a large part of Reliance Jio’s share gains will come at the expense of smaller operators without 3G/4G networks. The continued success of Reliance Jio in garnering new subscribers suggests the pricing environment in the sector should stabilise,” UBS said.
BNP Paribas stated Reliance Jio had already achieved a high level of penetration among smartphone users and the next round of growth was likely to be driven by users of feature phones. “Reliance Jio’s plans to ramp up its 4G feature phone supply over the next few weeks could drive the next leg of growth. Reliance Jio had a 10.6 per cent active subscriber market share as of September,” BNP Paribas said.
Over the last three months, Airtel’s wireless broadband customer base has increased by 13 per cent while Idea and Vodafone have recorded 12 per cent growth each. Idea and Vodafone have a total of 75.6 million wireless broadband customers, compared with Airtel’s 60.2 million. The incumbent telecom
operators have rationalised their prices for existing customers and are offering attractive deals to new customers similar to those offered by Reliance Jio.
“Airtel remains well positioned as Reliance Jio raises prices gradually, weaker operators exit and Idea-Vodafone focus on cost rationalisation post-merger,” BNP Paribas added.
According to a report by Citi, the proliferation of unlimited voice plans has helped start a consolidation of SIM cards because it negates the need to keep multiple SIMs to take advantage of the price arbitrage for making calls.
“Early signs of this are now visible with month-on-month fall in urban and rural tele-density. The trend should accelerate in the coming months, helped by an increasing shift towards unlimited plans and smaller players (used for second SIMs) either being consolidated or shutting their networks,” Citi added.