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Will 3G Launch Revitalise India's MTNL
MTNL recorded its best ever third-quarter figure for net additions in the three months ending 31s t December 2008, Q3 of its 2008/9 financial year. The gain of 229k took its total customer base over the 4m mark to 4.07m at the end of the quarter. MTNL is one of the smaller operators in India, the world's second largest mobile market by customer numbers, and it had an end- quarter national market share of just 1.2%.
Of course, MTNL is not a nationwide operator; in fact it only offers services in the metropolitan areas of Delhi and Mumbai. However, even within these two markets its presence is limited. Its larger operation is in Mumbai, but its customer base of 2.13m puts in fifth place out of seven, with only the troubled BPL and the newly-launched IDEA having fewer customers. It had 12.5% market share at the end of the quarter. In Delhi its share is even lower at just 9.7%, and with 1.94m customers it is the smallest operator in the city.
The Delhi operation is growing a little faster than that in Mumbai, with an annual growth rate of 33.9% in the capital compared to 29.2% for Mumbai. Both saw improvements compared to the year-earlier rates. On aggregate, the company grew by 31.4% in the twelve months to 31st December 2008, up from 22.0% in the previous calendar year. In terms of technology, MTNL's customer base is dominated by GSM with 95.9% of its connections, with the remainder on CDMA.
However, the company recently became the first Indian operator to launch 3G services, and this is set to change the composition of its customer base. It could also trigger a surge in the size of its customer base, of course, depending on how quickly its competitors (are able to) come to market.
Moreover, the uptake of 3G services may well have an impact on ARPU figures. In Q3 08/09, contract ARPU stood at an average of Rs. 244 per month, down 4.7% compared to the same quarter of the previous year, while prepaid ARPU was down 30.9% to Rs. 123. However, with cumulative revenues of Rs. 6,481m so far in 2008/9, the company looks set to improve on the Rs 8,364m recorded in the previous financial year.
Posted to the site on 11th February 2009
This article was extracted from The Mobile World Briefing, the weekly newsletter from The Mobile World.
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