Vodafone Idea Should Keep Focus on 4G Only

Vi must focus on expanding its 4G subscriber market share. The telco has got some amazing prepaid plan offers for its customers, but it doesn't have as many 4G subscribers as it would like. In Q1 FY23, Vi only added 0.9 million new 4G customers. It is a very slow rate, and the telco needs to figure out something to fuel growth.

Highlights

  • 4G is going to be the biggest chunk of revenue contributor for the operators from the mobile consumer services.
  • Talking solely in terms of 4G, Jio and Airtel are way ahead of Vi in the business.
  • Vodafone Idea is way ahead of BSNL in the 4G game, but when all the possibilities are assumed, there's one where BSNL eats up the 4G market share of private telcos, mostly of Vi.

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Vodafone Idea

4G is going to be the biggest chunk of revenue contributor for the operators from the mobile consumer services. While telcos are working their way toward rolling out 5G networks, their focus would not hinder from 4G at all. It would take more than half a decade to make 5G (with respect to consumer mobile services) a significant play for the telecom operators to earn major revenues. That said, Vodafone Idea (Vi), which has been recognised by Opensignal to deliver the best download and upload speeds in India through its 4G network, needs to work further on 4G. It is because just better download and upload speeds don't form the basis of a good consumer experience. There are other things such as 4G availability and coverage, along with the network performing well on different verticals such as online gaming and video streaming. These are the areas where Vi is not ahead of Jio and Airtel.

Talking solely in terms of 4G, Jio and Airtel are way ahead of Vi in the business. The capex spending of Jio and Airtel is more than where Vi is at, and Vi still has many legacy network users. Vi needs more 4G users on its subscriber pool as soon as possible. It will not only help with the average revenue per user (ARPU) goals of the company but would also give something positive for the investors to look at.

BSNL is Coming with 4G; Vi Should be Alert

Bharat Sanchar Nigam Limited (BSNL) is going to officially roll out homegrown 4G networks soon. It will be interesting to see how the performance of BSNL's 4G is. But in terms of optics, it would be a challenging time for Vi investors who would look closely at what the consumers of India are choosing. To be fair, there would be no competition between the 4G network of BSNL and Vi.

Vodafone Idea is way ahead of BSNL in the 4G game, but when all the possibilities are assumed, there's one where BSNL eats up the 4G market share of private telcos, mostly of Vi. This is because the users would now get the option of either switching to Airtel, which offers the services at the same tariffs but is considered a more premium network, or going to BSNL, which offers lower tariffs and could be a good option for a secondary SIM.

Well, whatever it is, Vi must focus on expanding its 4G subscriber market share. The telco has got some amazing prepaid plan offers for its customers, but it doesn't have as many 4G subscribers as it would like. In Q1 FY23, Vi only added 0.9 million new 4G customers. It is a very slow rate, and the telco needs to figure out something to fuel growth.

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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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