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Monthly net GSM subscriber addition rate inched up to 6.53 million net additions in September 2011, against 5.34 million in August 2011. Addition rates are likely to remain depressed in the medium due term due to the saturated urban market and difficulty in rural penetration
With the festive season in progress, monthly net subscriber addition rate inched up to 6.53 million net additions in September 2011, against 5.34 million in August 2011. This is lower than the first quarter of 2011-12 average of 9.86 million and the yearly average of 13.61 million for 2010-11.
Subscriber addition rate is likely to remain depressed in the medium term as (a) operators have difficulty in growing in a saturated urban market; and (b) building up volume in rural markets will require time & effort in enhancing marketing and network infrastructure. These are the observations made in a report released today by BRICS Securities Limited.
Idea maintained the lead in net additions among incumbent operators though net additions for all declined a month-on-month basis. It added 1.74 million subscribers in September 2011 against 2.33 million subscribers in August 2011. This is due to new circles contributing 28% of new subscribers. Idea has 13% market share in the total subscriber base.
Bharti’s subscriber base in India touched 172.8 million, as monthly additions declined to 0.94 million in September 2011 against 1.15 million in August 2011. Of the subscribers added, 74% were in circles where Bharti has a 3G license. Subscriber additions for Vodafone dropped to 0.85 million in September 2011 against 1.13 million in August 2011.
Uninor added 1.92 million subscribers in September 2011, highest among GSM operators against 0.35 million in August 2011. The increase in subscriber additions were from Uttar Pradesh (East and West), Bihar, West Bengal and Maharashtra circles, where it added 1.65 million subscribers in September 2011 against 0.15 million in August 2011. New cellular operators have been struggling to make significant subscriber addition.
The draft new telecom policy 2011 signals easy exit policy and license surrender—it is expected that new operators will revisit their business plans when the policy comes into effect. Incumbent operators will be able to gain revenue market share in spite of weakening subscriber market share. Decline in competitive intensity is expected to lead to tariff hikes. Regulatory uncertainty may recede with the new policy and with the adoption of 3G services, operators may be able to post incremental revenue.
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