Bharti Airtel Shifts Focus to Mass Retail Channels to Win Subscribers in Home Broadband
India's second-largest telecom operator by market share, Bharti Airtel, is intensifying its efforts to gain ground in the domestic home broadband market by focusing on mass retail channels. The move comes despite the company experiencing a growing gap with rival Reliance Jio in this segment.
According to Gopal Vittal, Vice Chairman and Managing Director of Bharti Airtel, the main reason for their struggles so far is the disparity in customer acquisition strategies. Traditionally, the company relies on direct-to-customer sales through e-channels, which has resulted in lower-than-expected growth in this segment.
However, with recent experiments in 4-5 circles and notable success stories like Northeast and Orissa states, Airtel is shifting its focus to mass retail channels across India. "We've seen substantial gains that we are now neck-and-neck (with competition)," said Vittal during an earnings call with analysts. This shift is expected to propel the company's home broadband subscriber base growth in the coming months.
During the October-December quarter, Bharti Airtel added 674,000 home broadband subscribers through fixed wireless access (FWA) and fiber-to-the-home (FTTH) services. The total number of subscribers grew by 8% on a quarter-on-quarter basis and 27% year-over-year, reaching 9.2 million.
However, despite steady growth in these segments, Airtel continues to lag behind Reliance Jio in the home broadband market. In contrast, Jio posted remarkable sequential growth with an addition of over 2 million users during the October-December quarter.
As part of its expansion plans, Airtel aims to expand its points of presence and activate its existing fleet of home delivery engineers to reach more customers. The company also set a target to enhance broadband penetration in India by reaching 80-90 million homes from the current 45 million over the medium term.
On the financial front, Bharti Airtel reported a significant increase in revenue with an 8.8% sequential growth of Rs 45,129 crore during the October-December quarter. The company also witnessed a fourfold jump in net profit to Rs 14,781 crore during this period.
However, despite these positive results, CEO Gopal Vittal emphasized that the company will not be aggressively pursuing new investments in 4G capacity but instead opting for additional 5G radios as it expands into new markets.