Vodafone Idea’s Loss is Jio’s Gain

Vi is the only private telco offering 4G services which has been losing active subscribers. Jio has clearly gained the most out of Vi’s loss while Bharti Airtel has also seemed to benefit marginally. BSNL is going to launch 4G services soon and it might further impact Vi negatively if BSNL manages to deliver a decent 4G experience.

Highlights

  • Right now, there are only three telecom operators in India who offer 4G network services.
  • TRAI data suggests that Reliance Jio and Vodafone Idea had 324.52 million and 256.32 million active users in the month of January 2021.
  • Vi needs to increase capex soon.

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Vodafone Idea

Right now, there are only three telecom operators in India who offer 4G network services. These companies are Vodafone Idea (Vi), Reliance Jio, and Bharti Airtel. Bharat Sanchar Nigam Limited (BSNL) is in the process to roll out 4G networks. The thing is, Vodafone Idea is the only private telco that has been continuously losing active subscribers for months now.

TRAI (Telecom Regulatory Authority of India) data suggests that Reliance Jio and Vodafone Idea had 324.52 million and 256.32 million active users in the month of January 2021. One year later, in January 2022, Jio had 368.53 million active users, while Vodafone Idea had only 228.81 million active users.

This is a sharp fall on Vi’s end while Jio has gained a lot. Bharti Airtel also gained marginally as it had 335.77 million active users in January 2021, which increased to 349.99 million in January 2022. BSNL saw a marginal decline from 61.40 million active users to 58.64 million in one year.

Jio and Airtel Gaining Vi Customers

Vi is the only private telco offering 4G services which has been losing active subscribers. Jio has clearly gained the most out of Vi’s loss, while Bharti Airtel has also seemed to benefit marginally. BSNL is going to launch 4G services soon, and it might further impact Vi negatively if BSNL manages to deliver a decent 4G experience.

Vi has been facing cash flow issues for a long time now. Not being able to raise money through the market has impacted the telco’s growth further.

If Vi needs to self sustain, the telco needs another tariff hike along with external fundraising. Vodafone Idea has not been able to match the capex levels of Reliance Jio and Bharti Airtel. Further, Jio offering cheaper tariffs than Vi has pushed people to opt for Jio more than Vi.

The government is expected to return bank guarantees worth Rs 15,000 crore to Vi and Rs 7,000 – Rs 8,000 crore to Airtel.

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Tanay is someone with whom you can chill and talk about technology and life. A fitness enthusiast and cricketer, he loves to read and write.

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