Bharti Airtel to Now Focus on High Paying Customers to Boost ARPU

Bharti Airtel now seems to have found a new way about selling differently priced plans as compared to Reliance Jio. The telco has decided that selling to the customers who are paying as low as Rs 35 per month is just not worth the hassle. As such, the telco will now focus on catering to better-paying customers, and it is going to be the telco’s new strategy against competing with the Mukesh Ambani led telco, Reliance Jio. This move is also expected to bring in better sales and will help the company in covering administrative and other related costs.

bhart-airtel-arpu-boost

Bharti Airtel to Focus on Increasing ARPU

If we are to go by what analysts say then this revamped strategy might click for Bharti Airtel in the hindsight. It’s also high time that Bharti Airtel takes a different approach for competing with Reliance Jio since the telco has consistently seen falling revenues and declining profit ever since Reliance Jio entered the arena. In the quarter of July-September, the net profit of Airtel went down 65% from a year earlier to Rs 119 crore, while revenue declined by 3.6% touching Rs 14,920 crore.

In the post-earnings conference call with investors, Airtel CEO, Gopal Vittal said “We have about 330-odd million customers in wireless. But if you look at the pattern of consumption… about 100 million customers have very low levels of ARPU (average revenue per user).” He further added, “So these ARPUs are at sort of low double-digit… In the last one and a half months in three circles in Tamil Nadu, UP West and Punjab, we’ve introduced minimum ARPU-led plans at the low end… We’ve seen some good results in and we’re now rolling it just now across the country—in fact, in the last seven days, we have already rolled out across the country.”

Airtel Dominates Rural Regions Reliance Jio Thrives Overall

We get to see an interesting picture while looking at the subscriber bases of both the competing telcos. According to the data published by the telecom regulator Trai, Airtel holds the highest subscriber base in rural regions with 33.44% market share whereas Reliance Jio holds 12.22% of market share in these regions. However, when speaking about the total wireless internet subscribers, the picture is very contrasting since Airtel holds 25.3% of market share, whereas Reliance Jio holds 43.8% market share.

A person aware of the matter also spoke about this move to Livemint, “Letting go of customers who recharge less than ?35 a month, particularly those who mostly receive incoming calls or do very small recharges, would also free up Airtel’s network and ease congestion. This would, in turn, improve the quality of service for high-paying users.”

This strategy of letting go low paying customers will open new doors for Airtel and will also allow the telco to reserve its infrastructure and resources for better-paying customers. Besides this, the Sunil Bharti Mittal led telco is leveraging its content partnerships with Netflix, Zee and Amazon to force customers into spending more on its plans. This is also expected to create a spike in average revenue per user as well for Airtel.

Airtel CEO, Vittal said, “… If you look forward a couple of years…we should see at the lower end, 100 million customers giving us low double-digit ARPUs compressed further by 30-40% and an ARPU upside there.” Vittal had also already clarified in the past days that Airtel wouldn’t be getting down into the field of feature phones to compete with Reliance Jio. However, for Jio it’s a good signal since the telco has managed to add an immense number of subscribers through its affordably priced JioPhone. Jio’s subscriber base has gone up from 46.6 million in end-March to 73.11 million in end-August.

Amresh Nandan, Vice president and analyst (tech) at Gartner also spoke about this new development, “The days of endless tactical fighting such as tariff wars are getting over, and telcos need to revisit their future business strategy. Bharti Airtel seems to be refining its strategy in this intensely competitive market.” He further added, “A subscriber is a source of revenue, but it is also a cost to the operator. Bharti Airtel is focusing on the segments of importance, based on their future business plans.”

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87 Comments on "Bharti Airtel to Now Focus on High Paying Customers to Boost ARPU"

 

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Skm
November 3, 2018 5:27 pm 5:27 PM

Time for single sim connection .2nd sim also carries cost

Jsb
November 3, 2018 12:11 am 12:11 AM
Airtel the looters. I had a very bad experience in recharging international roaming pack of Airtel. I recharged my Airtel number with international roaming two days before the travel and I was thinking the plan will activate only when I start using in international network. But the validity started counting from the date of recharge. Jio’s international roaming plan validity starts only when you use it in international network. Even after losing customers because of Jio, Airtel has not learned any lessons. They will try to loot customers in whatever way they can. Jio’s is best in international roaming and… Read more »
Sayantan(Kolkata)
November 3, 2018 10:25 am 10:25 AM

Have you used Jio in international roaming? If yes,in which country and which phone were you using?

Jsb
November 3, 2018 4:53 pm 4:53 PM

I used it in UK and USA. I am using mi 5.

Sayantan(Kolkata)
November 3, 2018 10:55 pm 10:55 PM

Was Jio working perfectly in USA and UK? Did you manually select the network or the network got selected automatically? And did you recharge the international roaming pack on Jio before leaving India?

Rakesh Singh
November 2, 2018 6:16 pm 6:16 PM
I have not seen any thing wrong in this move. If Jio don’t have any Talk time plan, why should other are restricted to continue the same? Max user are having 2 SIM these days, one is Jio and 2nd one if of old player. Since Jio do not have any Talk time plan, every body recharging Jio SIM and using older players SIM just for incoming calls. Older players are not here for charity, they have invested money in this business and must be there in the market. It is beneficial for customers too in future. Monopoly is not… Read more »
Jagannath
November 2, 2018 11:37 pm 11:37 PM

+1

Manoj Singh
November 2, 2018 9:01 pm 9:01 PM

They’re giving unlimited validity talk time top up

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Jagannath
November 2, 2018 11:38 pm 11:38 PM

Regular top up does not work on Jio for calls n data.

Manoj Singh
November 2, 2018 8:57 pm 8:57 PM

You are wrong, they have unlimited validity talk time top up also.

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Vipin
November 4, 2018 1:32 pm 1:32 PM

The talktime balance can only used for International calls and for International roaming calls. It cannot be used for local calls. Also, inorder to use the talktime, you should have any active plan on your number. If the plan expired, you cannot do even these calls too using the talktime.

saket kewate
November 2, 2018 10:16 pm 10:16 PM

but you cant use it for calling to local/std number… once validity stops, outgoing doesnt work

Jagmohan Rattan
November 2, 2018 9:46 pm 9:46 PM

Try use that core balance making calls and sending sms’s then come here and comment

Rajnish | Agra
November 2, 2018 9:08 pm 9:08 PM

Can these unlimited validity talktime be used for anything?
Once my Jio plan expired, I recharged with this 20rs plan but it is just useless.

Plan recharge is compulsory in jio.

Jagmohan Rattan
November 2, 2018 8:03 pm 8:03 PM

+1

Sayak Roy - Kolkata
November 2, 2018 7:16 pm 7:16 PM

Exactly

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