Indian telecom companies added a whopping 7.34 mn users in June, 2007

The temporary slowdown in India’s celebrated telecom growth over the last couple of months due to government’s enforced verification drive is now history. The telecom sector is buzzing again—operators have added a record 7.34 million subscribers in June, the highest subscriber growth in a month so far, the country’s telecom regulator. More importantly, industry players also said that June’s growth in subscriber numbers was a global record. Going forward, the industry is also confident of maintaining the growth rate of 7 million plus new users per month.

GSM players accounted for over 71% of June’s record growth and contributed 5.2 million users to this fold while the CDMA operators added the rest. This has also resulted in the Indian cellular base crossing the 185-million mark.

However, despite record growth over the last 12 months, the fact is that less than 20% of the country’s 1.1 billion population own a telephone! “If the government extends its support in the form of good policy decisions, then the sector can increase the 7 million monthly figure to about 9 million,” said the spokesperson with a leading cellular operator.

Commenting on the record growth, the Association of Unified Service Providers of India’s general secretary S C Khana said, “The growth was driven by CDMA players who cut handset prices to less than Rs 1,000, forcing the GSM sector to follow suit. The competition that followed over the handset price wars resulted in record additions. With more cheap handsets set to come in, and as the network coverage increases especially in the C category circles, the growth rate will increase.”

A closer look at June’s figures tell an interesting story. At a time when all players are riding the cellular boom, public sector BSNL has registered negative growth in five of the 21 telecom circles where it offers services. The PSU added just 0.43 million new subscribers in June compared to 1.96 million additions by Bharti Airtel, 1.54 million by Vodafone-Essar and 1.2 million by Reliance Communications. At the same time, India’s largest cellular operator Bharti Airtel continues to outperform the industry—the company added 1.9 million users last month taking its total subscriber base to over 42 million.

While cellular growth is back on track, the broadband sector has failed to match the trend. Total broadband users totalled 2.52 million in June-end, with the addition of a mere 0.06 million new connections last month. Despite 2007 being declared as the Year of Broadband, the country has added just 0.47 million high speed internet users during the first six months of the year.

India had added a record 6.73 million subscribers in January this year, but the preceding months witnessed a slow down with growth remaining below the peak of 6 million per month for the next couple of months as the impact of stringent verification rules and capacity constraints began to show. This resulted in the subscriber additions falling to 5.96 million in February, 3.53 million in March and 5.38 in April, before picking up to touch 6.57 million in May.

Source:

• Telcos add 7.34 m subscribers in June - The Economic Times - July 26, 2007

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