Even as Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telecom Nigam Ltd (MTNL) are struggling hard to survive the onslaught, private telcos are now snatching more and more landline subscribers from the State-run telecom companies. In fact, during fiscal 2022, both BSNL and MTNL lost 17% market share to private telcos, says a report.
Aniket Dani, director of CRISIL Research, says, "Bundled offerings such as affordable broadband are the major reasons for the gain in the market share of wireline telephony. Wireline broadband subscriber base has logged a compound annual growth rate of 19% between fiscals 2020 and 2022 to 27.25 million."
"Competition is intensifying in the wireline segment, with Reliance Jio clocking the highest subscriber additions over the past two years. Bharti Airtel continues to lead in terms of wireline subscribers, followed by Reliance Jio," he added.
For example, at Rs899 per month, Reliance Jio offers its JioFibre connection with 100Mbps speed, with unlimited data and 14 over-the-top (OTT) apps. Airtel offers 200Mbps speed and unlimited local and STD calls with a free subscription to Disney-Star, and Amazon Prime at Rs999 per month. MTNL's subscribers, with a monthly tariff plan of Rs500 and more, can avail its voice over fibre network (FTTH) service and broadband that offers download speed up to 50Mbps till 10GB data and unlimited usage at 256Kbps afterwards.
The wireline segment, which has caught the eye of players of late, added another about 0.3mn (million) subscribers in April. Especially amid the pandemic, interest in the segment has revived among private telcos.
In April 2022, the share of public enterprises in wireline telephony fell 91 basis points (bps) to 41% in April over March.
More importantly, CRISIL points towards a substantial shift as public enterprises, which accounted for about 59% of the subscriber base as of fiscal 2020, had lost more than 17% of subscriber market share to private telcos as of fiscal 2022.
"This fiscal, the wired broadband subscriber base is expected to grow 9%-12%. Telcos have sharpened their focus on the growing wired broadband segment, which offers huge potential as the country remains highly underpenetrated, at only 9% penetration as of last fiscal, compared with over 55% in China, over 70% in the Eurozone, and over 75% each in the US and Japan," the report says.
During April, India's total wireless subscriber base increased by just 0.6mn compared with previous month. On the contrary, active subscriber base shrank by a huge 7mn due to SIM consolidation.
According to Mr Dani, impact of tariff hike and inflation has forced subscribers to rationalise expenses. "The impact was visible on urban teledensity, which fell 30bps in April as subscribers ditched their extra SIM cards. Rural teledensity, however, improved marginally, by 9bps. The impact of increase in repo rate needs to be monitored as urban teledensity could fall further in the first half of this fiscal, with subscribers in some pockets feeling the heat."
"On active leadership across circles, Reliance Jio caught up with Bharti Airtel, with both players leading 10 circles each as of April (at the end of March, Reliance Jio led 9 circles, while Bharti Airtel led 11). The competition is expected to remain intense this fiscal, with both players anticipated to focus on semi-urban and rural dominated circles," he added.
