The telecom industry is in a tricky position right now. There are a few telecom companies that are fighting for the top spot, whereas others are busy carving their name in the survival list of the companies. We need not go into details of who’s who of this industry as that remains pretty much clear to anyone who’s been following the news headlines. However, what seems to be happening between Bharti Airtel and Reliance Jio is not only a rigorous competition of numbers but also a competition of quality, service, and retention. The telecom industry is guided by a few numerics, which include the Average Revenue Per User, easily the topmost chased metric in the telecom world, followed by subscriber base. However, one metric that has been often overlooked is active subscribers. But, now it seems with small spikes in ARPU and subscribers creating a massive ripple effect, this metric is more important than ever.
Top Spot of Active Subscribers Held by Bharti Airtel
As per the latest data released by the Telecom Regulatory Authority of India (TRAI), the Mukesh Ambani-led telecom company leads in the subscriber numbers, but when it comes to active subscribers, Bharti Airtel is at the top spot. Bharti Airtel currently boasts of having 346.95 million active subscribers, whereas Reliance Jio has 335.17 million active subscribers, almost 11 million less than the Sunil Bharti Mittal led telco. The situation that both the telcos are in is not new but has been persisting since the December of 2020. Also, it should not be mistaken as a mere coincidence but a carefully crafted and desired position by Bharti Airtel.
What Did Airtel Do Right?
Sunil Bharti Mittal and other execs in many interviews since 2019 and in 2020 have expressed that Bharti Airtel has always been seeking “high paying” customers rather than a huge volume of subscribers, which were low paying. At the same time, Reliance Jio’s strategy has been quite the opposite. With the launch of JioPhone, the Mukesh Ambani-led telco went after rural customers with cheap plans which were specifically targeted for this user base.
Whereas, on the other hand, Bharti Airtel did not make any attempt to go this way. Rather, the telco focused on doubling down on its broadband business, Xstream Fiber, and also introduced prepaid plans which were bundled with OTT services like Amazon Prime and were thus priced higher as compared to the competition. Not only this, Reliance Jio, long after its foray into the industry, did not make any efforts to introduce postpaid offerings, and even now, that department remains lukewarm for the telco. The only effort by Reliance Jio in the matters of high-paying customers came with the launch of JioFiber.
But given the pricing of the JioFiber plans, and the fact that it comes with a free month of usage for the subscribers and bundles DTH services in the same amount, points to a rinse and repeat in terms of strategy again geared towards numbers rather than weight and quality.
Who Needs to Learn What?
With all this being said, the picture is not all grim for Reliance Jio since it has still added more subscribers, around 19 million as compared to Bharti Airtel’s approximately 18 million subscribers. This just points to the fact that while Reliance Jio is adept at adding new customers to its network, Bharti Airtel is surely better when it comes to making them stick around.
It is obvious that both the telecom companies have little to learn from each other in some areas, but looking at the condition of the industry, which demands a higher ARPU, the path of Bharti Airtel looks more promising and resilient because the paying customers are going to be the active subscribers only. And, with a basket of premium goods in its portfolio, Bharti Airtel is likely to be pulling in more revenue numbers as Reliance Jio’s pie will be distributed among a larger volume of subscribers.
