Airtel, Vi Might Bring 300 Million Feature Phone Users To 4G

Even though telecom operators have mapped out plans to offer 5G services by the end of 2021, the 4G user base is likely to increase in India. The user base is expected to touch 820 million in FY22 despite the competition getting fiercer among the three telecom players.

According to Crisil's new report, Reliance Jio, Airtel, and Vodafone-Idea are likely to use their newly acquired spectrum to increase the 4G coverage and might help telcos attract 300 million feature phone users. "India's 4G subscriber additions in FY22 will be more than in the last fiscal, despite the Covid19 second wave. Due to higher competitive intensity stemming from significant spectrum acquisitions by the big telcos in the March 2021 auction, leading to Bharti Airtel, Reliance Jio, and Vodafone Idea achieving spectrum parity in terms of the Mhz/million subscriber metric," the rating agency said.

The firm states that COVID restriction is limited to the first quarter of this financial year. However, the firm added that if the lockdown is extended until the second quarter, then there are chances that the 4G user base might stand at 800- 810 million.

Airtel And Vi To Take Some Steps To Migrate 2G And 3G Users To 4G

The research firm said that both Airtel and Vodafone-Idea have to take to steps to shift 2G and 3G users to a 4G network to decrease their network cost. Notably, both telecom operators are also refarming their 3G network to offer proper 4G services in the country. The firm added that all private telecom operators attract feature phone 250 to 300 million users to 4G services.

"With the recent spectrum acquisition, telcos are well-positioned to handle any surge in data traffic, leading to increased aggression by the players to gain market share," the rating agency said in a research report.

It is worth noting that Reliance Jio purchased 488.35 units of airwaves in all circles, while Airtel bought 355.45 units of the spectrum, and Vi acquired only 11.8 units of airwaves. Vi only bought spectrum in five circles for close to Rs. 2,000 crores, while Jio spent Rs. 57,123 crores for the spectrum and Airtel purchased that much spectrum for Rs. 18,699 crores.