Vodafone India has revealed that its customer base declined by 3 million quarter-on-quarter. The decline in its subscriber base shows the growing industry trend where customers are switching to different telecom operator.
The total operator base of Vodafone India now stands at 219.7 million and reflects the ‘SIM consolidation’ trend in the country. However, Vodafone says that the number of data users in the country has continued to increase. The telecom operator claims to have 77 million data users, out of which 30.9 million are 4G data users. Vodafone also confirmed that it added 4,900 4G sites during the quarter. Despite decline in its user base, Vodafone India managed to retain high-value customers at lower price. Its contract ARPU declined by 20 percent while prepaid ARPU declined by 28 percent during the quarter.
The service revenue also declined for the company by 22.3 percent and it reflects cuts introduced to both domestic and international mobile termination rates in prior quarters. The company is facing strong price competition from incumbent players like Bharti Airtel, Idea Cellular and newer player such as Reliance Jio.
“This pricing pressure was mitigated as customers consolidated spending onto a single-SIM following the increased penetration of ‘unlimited’ offers, which have now been adopted by 29% of our prepaid customer base,” Vodafone said in a statement.
If the impact of MTR cuts is excluded, Vodafone says its service revenue declined by 9.6 percent on a sequential basis. The local currency revenue excluding MTRs declined 0.2 percent quarter-on-quarter. The silver lining is that Vodafone’s data traffic increased by 57 percent during the first quarter of financial year 2019. Vodafone expects its merger with Idea Cellular will be completed by the end of August, reports Telecom Talk.
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“Our network investments have created a strong platform to capture this data demand, and we continue to have the leading or co-leading network NPS scores in 14 out of 20 markets including India,” stated Vodafone.
Vodafone is currently the second largest telecom player in the country and is said to be making progress securing necessary regulatory approvals for the planned merger of Indus Towers into Bharti Infratel. The proposed merger has already received approval from the Competition Commission of India (CCI) and SEBI. The deal is expected to close early next year.