Airtel Slashed 4G Price By 80% : "Be Careful"

Airtel announced that they slashed 80% and at the same time asked user to do one time recharge in order to avail lower cost recharge for data per GB. Currently airtel charges 259 per GB. We calculated the plan and the current cost yo end user and we realise that airtel slashed price from 30 to 38% instead of 80%. User should be careful while adopting the service and should ask airtel center the calculation before recharging. Our calculation might be wrong and in that scenario please share your comment with the calculation and it is also valid for Airtel

Bharti Airtel Tariff Plan - Open Challenge to Reliance Jio

The buzz is everywhere in the Telecom sector that Reliance Jio will be coming out with very aggressive tariff which will be bundled with cheaper device from LYF as well as device from their panel. Reliance Jio intention is to focus on the data revenue through series of data centric applications or games or services whereas offering subsidised voice or free voice.

Even Bharti Airtel Chairman Mr.Sunil Mittal also admitted that Reliance Jio entry will change the tariff dynamics of Indian mobility segment and it will take an year to settle down the dust. The impending price war will also force some of the running Telco to go for merge or will be acquired by big fish.

In the meantime, In order to create non breakable wall to protect their high APRU user Bharti Airtel came out with myPlan  Infinity. In the two plan segment, Under 1199 plan user will get free voice call , few free SMS and 1GB of 3G/4G data free along with Wink movie and music whereas under 1599; the data pack offering is increased to 5GB.

I call the proposition a master proposition as Bharti Airtel is well aware that average data consumption per user per month stands at 0.9GB and at the same time, they will promote their in-house product  which will trigger user to use higher data at the same time reduce the Bharti Airtel user acquisition price for those product by INR 50 .Bharti Airtel is also well aware that the average ARPU per user is around $3.2 on a consolidated basis but when it comes to postpaid it comes up around $10. In new plan they will increase the ARPU by $7. On  contrary, in 1599 plan, Bharti Airtel is trying to attract very heavy data user and am sure that they will be putting the new plan attached user under priority based queuing access mechanism to ensure the best QoS ( Quality of Service).

The proposed plan will also attract many prepaid users who will be willing to convert into post paid given the fixed rate as it include all the options of calling including roaming. At the same time,  In my point of view many users from other network who is not happy with their service providers will opt of Mobile Number Portability and switch over to Bharti Airtel

It will be interesting to see Reliance Jio marketing strategist movement to super counter Bharti Airtel classic move. I also believe the further delay by Reliance Jio will put Reliance Jio in difficult position to lure away high APRU userbase from competitor.

Bharti Airtel CEO Concern Around Data Adoption - Learning for All

Bharti Airtel came out with satisfactory Q1 FY17 result with growth in all segments. Bharti achieved improved from EBITA level and also managed to reduce their debt level while generating healthy cash flow generation. Most of the analyst was concerned about the fall in voice usages as well as impact on data usage path. On a contrary, the result indicated that Data User base increase marginally whereas the Data APRU is in and around $2.9; same as last quarter. 

The concern area is exponential growth in their data consumption which is stagnated around 1GB per active user. With around 59 Mn Data users, Bharti Airtel is again Number one in the segment. The per user data consumption clearly indicate that Indian user appetite level and it may increase to 2 GB down the line once the price deduction implemented by Bharti Airtel. The recent interview by Bharti Airtel CEO Mr. Gopal Vittal that device price point acts showstopper but we all need to understand that we should not go by the number of mobile connection but should focus on literacy rate of India. As of today, India is having around 310 Mn data user and at max it can go to 450 even if device price go down to 1000 INR. 

According to one article published in Moneycontrol.com that around 133.3 Mn citizen income is less than 5000 INR per month and in that scenario, we must discard those userbase as potential data user. At the same Mobile penetration in rural sector is around 41% and that comes around 500 Mn wherein those user are only interested to receive call and generally uses missed call to inform the other side to call them back. Even though you capture15% of such user then out of 633 Mn TAM, the SAM will be around 100 Mn and there any operator will face the issue of payment recovery. The cost of laying down the network vs. cost recovered is near to zero and we should learn from BSNL situation. Based on the above calculation we are left with 700 Mn connection available in Rural and sub rural segment and dominant connection comes from Metro. The Tele-density of Urban area is around 150% and that reduce the TAM of 700 Mn to 500 Mn. Basis the calculation we have TAM of 600 Mn and we already captured 50% of the same as active userbase. If we deduct 70Mn -80Mn userbase who is using double connection then we are left with 520 Mn user base which left us with around 210 Mn additional user to be grabbed.

The analysis clearly indicates that we all are over optimistic about the growth of data user and data usage in India. We should also be very cautious about the potential of growing APRU and it will only go down the line post Reliance Jio launch. Bharti Airtel cleverly placed its alternative data product in the market place which in-turn started generating revenue and will continue to grow but other service providers needs to give serious thought about the path to 4G. It will be interesting how Reliance jio will play out in terms of pricing and positioning of their services through subsidy and how far they can sustain subsidy

Why Bharti Airtel Should Enter Into Smartphone Segment

It's an irony of the ecosystem that the company who changed the Indian telephony system with their innovative base telephony devices. Mr. Sunil Bharti Mittal vision, predictions and insight about Indian Telecom sector never went wrong. Bharti Enterprise at one point of time through their base telephony device in the Indian market forced global player like Panasonic to Sony to look for cover.

Post mobility revolution, organization moved their focus more on the services side while forging market disruptive methodology of hardware attached revenue share which is now the trend of the industry. In the last 23 plus years, Bharti Airtel positioned itself as de-facto brand in Indian geography while entered into Africa. Many are predicting the potential failure in African Market in coming years but I differ completely with Critique and will come back with reference based article very soon.

The rush for use acquisition post new service provider in India during last 8 years helped Airtel to consolidate its competitiveness and enhanced its workforce determination to weather any threat to their business be it pricing to performance.

I truly admire Mr. Sunil open admission about Reliance Jio entry and its implication on the pricing as he is also predicting Reliance Jio play which I mentioned in my previous article about the reliance jio. Reliance Jio is getting aggressive in their push to capture the device market with an intention to create an ecosystem but again as I pointed out in my previous article's is reliance jio betting to be google of India that Reliance Jio must learn from the failure of Reliance Communications.

In my point of view,  Bharti Airtel should turn the tide towards the Competitor by launching their own device supported with their multiple application such as Airtel Wync Music, Wync Movies, Wync Games for which they are spending user acquisition $. It will again a disruptive move by Bharti Airtel an how

The Management & Promoters understand the manufacturing to distribution market basis their background.

Many ex- Distributor's of their basic telephony system is now the owner of Smartphone companies and it may help them to acquire some of the struggling domestic companies with their facility and rebrand the Device with Quality.

Bharti Airtel Userbase is more than 225 Million and more than 70 Million user on their network are active Smartphone user's using data.

The Total market size of Indian Smartphone will hover around 95 Million to 105 Million during FY 17

The one of biggest beneficiary of MNP ( Mobile Number Portability )

The lowest Churn rate in Telecom Industry

Wide reach of Bharti Airtel Store is in place

The above mentioned points are some of the pointer which Bharti Airtel may consider to turn the tide as device manufacturer works with a margin of 3 to 4 on net level and generate maximum revenue from VAS revenue. The net profit margin of 7 to 8 % can easily be reached given their strongly coupled services, platform and Application layer. I won't be surprised if it comes sooner than later.

Bharti Airtel Wynk Launch – Upcoming Pain For OTT Music Player

As per the trend, Bharti Airtel again initiated to change the market dynamics and this time around his initial focus turns on Music steaming. In recent years, it was predominantly visible that MVAS business going down post MVAS regulations and none of the innovative product was offering by MVAS players to help revive Mobile operator VAS business. Most of the operator centric VAS companies realigned their strategy on Mobile applications to sustain the dynamic industry change. The dwindling revenue from VAS segment and subsequent predominant situation of MVAS players to demand for level playing revenue share discussion offered enough indications that Mobile operators in India is losing edge and even their trusted partners turning their back.

The inclusion of fresh thoughts during one of the toughest transition of Bharti Airtel history, at last innovation received thumps up. The launched network and device agnostic music applications WYNX coupled with online and offline support is a master stroke from Bharti Airtel to reignite the MVAS revenue stream and subsequently higher data network utilization. Bharti Airtel went one step ahead of Vodafone and launched cross operator to demonstrate their latest theme of “Data enabled differentiated Network” which is airing across TVC and print media.

The attached payment mechanism and known efficient execution of Bharti Airtel in launching any product raises the viability of OTT players like Hungama, Saavn or Gaana as they rely on Advertisement revenue. It is pretty clear that these players will have tough time to promote their promote on Airtel network and subsequently on other network as competitor will be launching similar product in no time. It’s always been discussed about the content acquisition cost and subsequent ownership of the content but the move by Bharti Airtel made it pretty clear that it’s not far that Mobile Operator will be procuring content directly.

Now, it will be extremely interesting to see the follow up action by competitor and repositioning move by OTT players to mitigate direct threat to them