India's 4G mobile data subscribers are expected to rise to 820 million by the end of March 2022 - higher than in the last financial year (April to March) despite a Covid spike.
According to a CRISIL report, India's wireless-telecom subscriber base rebounded to 1.159 billion in January 2021 same as that to pre-pandemic levels after a falling to 1.140 billion in June 2020 following a massive churn during the lockdown, which saw reverse migration causing a labour crisis.
The research company said the pandemic slowed 4G subscriber additions to 12 million in the June 2020 quarter, with smartphone shipments probing new lows. There was a recovery in the quarters that followed, but growth in 4G subscriber additions remain below the pre-pandemic rate.
However, the March 2021 quarter would have been better because India’s 4G subscriber base is expected to have risen to 710-720 million in the fiscal year 2021.
The competition is set to intensify with the Big 3 telcos likely to use their freshly acquired airwaves to boost coverage and push the country’s remaining 250-to-300 million feature phone users to go 4G, said Crisil Research.
"Given the prevailing scenario, our bull case is 4G subscribers rising to ~820 million by the end of this fiscal, assuming restrictions last only for the current quarter. In the bear case, where lockdowns extend through the second quarter, we see that number reaching ~800-810 million" the rating agency said.
The acquisition of spectrum by telcos in the March 2021 auction has led to three major players — Airtel, Jio, and Vodafone Idea — almost achieving spectrum parity as they are now comparable in terms of MHz/million subscriber metric.
Additionally, over the last two years, incumbent operators like Bharti Airtel and Vodafone Idea have re-farmed the 3G spectrum for 4G use across a majority of circles, leading to significant 4G capacity addition.
Crisil ruled out price war, competition is expected to be indirect, in the form of tie-ups with smartphone manufacturers for low-cost phones, increased bundling of over the top (OTT) content, and lower entry points for upgrade customers.