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With 1.3 billion Indians to serve, the telecom space is a very promising place to be: Gopal Vittal, CEO, Bharti Airtel

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At the fourth edition of the annual ‘Google for India’ event, Gopal Vittal, CEO, Bharti Airtel  emphasized on the importance of digital, given the fact that digital delivers a 12- 14% incremental reach over television.

Speaking about the disruption in the telecommunication space over the last two years, Mittal said, “It has been a rollercoaster ride in the last couple of years. This was an industry that had 8 players from 14 players a couple of years ago.  If you look at most of the large markets around the world, they typically have between 2 and 4 players in our industry. So an 8 player market is clearly not a sustainable situation.”  He gave full credits to the new entrant Reliance Jio which came in and helped in fostering consolidation. “It’s been a massive structural shift but the silver lining in all of this has been that we are down from an 8 player market to a 3 player market effectively. Therefore, 95% of the market is being served by these 3 key players. With 1.3 billion Indians to serve, this is a very promising place to be. Also, given the health of the sector, from a demand side, there has been a massive surge. We have seen the consumption of data jump 14x on our network in just two years.”

Talking about challenges in the space, he said, “The flip side to this is the requirement of massive capex. If you look back over the last two years, we have invested 24000 crores each year. The spectrum investment over the last five years is about a 100000 crores. So capex and spectrum investment have gone up dramatically and the reason is simple that with this kind of demand, you need to create that capacity.”  He also spoke on the challenges that telecom companies face in terms of network performance owing to rapid growth. However, in a market which has been very turbulent and has come at the expense of revenue, Vittal claimed that they have actually grown market share over the past few years and this has been an opportunity for them, considering the large population that needs to be served by the 3 key players.

 

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