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Although February marks the near end of fiscal year in India (Apr-Mar), the Union Budget on 1st Feb stirred the market well enough to take note. High hopes were riding on this year’s budget, but no special announcement made, disappointing the industry.

In the meanwhile, Jio, the newest entrant on the block achieved the feat which no other telecom player could achieve in such short span. Yes, you got it right. Jio now holds approx. 24% of broadband connection market share, all in the wireless segment, surpassing market leader Bharti Airtel (20%) and Vodafone India (16%) to the distant third. Jio also became 6th largest operator by market share, commanding impressive 7.85% of the telecom market (as on Nov 2016), just behind Aircel (8.24%) and BSNL (8.71%). As numbers are still counting, we believe, Jio should become 4th largest operator by March (2017) trailing just behind Idea, Voda and market leader Bharti Airtel.

According to another report, Jio already carries 94% of India’s mobile data traffic, while I+V+A combined capacity is mere 6% of the pie. The report adds that incumbent Bharti, Idea and Vodafone lags far behind Jio in 4G and Data coverage. Interestingly, Bharti Airtel topped the chart with 4G speeds, leaving others behind by far margins. Somehow, we are not going deep into these speed test reports, as we believe as Jio is carrying the massive amount of data traffic, resulting in individual download rate reduction.

Indian Telecom Regulator, found nothing wrong with Jio’s tariff plans, esp. with ‘Happy New Year Offer’ and maintained that it is different from ‘Welcome offer’. The matter was raised by Bharti Airtel with TDSAT citing that Jio had continued to provide freebies beyond stipulated 90 days period, mandated by the regulator. With the go-ahead from the regulator, there is a high possibility that Jio might extend the new year offer beyond March, but of course with reduced freebies and with the new name. Who doesn’t want to maintain the growth tempo?

Last week, Vodafone India admitted that it’s in talks with Idea Cellular, third largest telco by market share, to merge its business interest. Although still at early stage, ET carried details article on how this could unfold in coming days, making V+I the biggest entity holding 43% of RMS. Apparently, both Vodafone and Idea participated in recent spectrum auctions and bid separately and won airwaves, which we believe could be the most challenging aspect of M&A. Jio’s entry and esp. the tariff plans caught both of them off the guard, and if Industry veterans believed, V+I would be in better position to challenge both Bharti and Jio.  We came across an interesting article on Vodafone’s India adventures for past one decade, and it appears that M&A is not new for Vodafone’s India unit. Let’s wait and watch!

We followed few other stories across the globe. AT&T, who was trailing AirGig technology since September last year, is in talks with utility pole companies to tap ‘Broadband over Power lines’ to provide better 4G (and 5G) coverage in SF Bay area. Although it’s not clear how this would be better than existing FTTP approach, we believe AT&T is trying to utilise ubiquitous utility poles, who could also provide better indoor and street coverage, than traditional Marco cells.

In meanwhile, Verizon (and others US Telcos) are upgrading Small Cells and Stadium DAS Infrastructure for this year’s Super Bowl games. Read more about it here.

(Image Credit: Purvi Joshi from Flickr)

 

 

 

 

 

 

 

 

 

Atul Deshpande

The author Atul Deshpande

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