Betting big on the quality of telecom services in the sector, telecom giant Bharti Airtel will invest Rs60,000 crore in the next three years. The company aims to upgrade networks and improve quality of services as competition intensifies in the sector. The company’s announcement on Monday came at a time when frequent call-drops are still not under control. The Government has been asking telecom operators to invest in network infrastructure to improve the quality of services.
As part of its ‘project leap’, which will entail investments of Rs 60,000 crore, Bharti said it would undertake a massive transformation of its network and will deploy over 70,000 base stations in 2015-16, making it the largest deployment in a single year since its inception.
Recently, Mukesh Ambani-owned Reliance Jio’s proposed entry into 4G also has further intensified the competition in the telecom sector to improve their revenues. Reliance Jio is likely to launch its cheaper and faster 4G-focused data services in first quarter of 2016. It has invested about $14 billion - partly to acquire 800 MHz spectrum in 10 circles and higher-bandwidth spectrum of 2300MHz/1800MHz in 22 circles.
As far Airtel’s move is concerned, the company will deploy over 1,60,000 base stations in three years, effectively doubling its presence from what it has currently on the ground. “Bulk of this investment will be on capital expenditure as over the last couple of auctions, we have bought a large spectrum and we are well covered in almost all circles. There are only a few pockets where we need to pick up more spectrum,” Bharti Airtel (India & South Asia) MD and CEO Gopal Vittal said.
The planned investment will be raised largely through cash accruals and includes the capex target of $2.2 billion for the current fiscal, he said. He added this fiscal, India’s capex is highest in the history of Airtel at about Rs16,000 crore. “We have seen improvement in quality of network in the last six months. I would like to reiterate that we are not where we need to be. There are locations and localities where we still struggle. We are working with all the concerned authorities,” Vittal said.
Telecom regulator Trai has said that there is no significant improvement in call drops and it will conduct another drive test in December to check the situation. The regulator had in June and July conducted drive tests in Mumbai and Delhi, which showed unsatisfactory network quality. Trai than convened a meeting of all telecom operators to improve quality of network.
To assess the improvement, Telecom Regulatory Authority of India (Trai) had undertaken repeat drive test in Mumbai and Delhi on September 27 and 28, 2015 to assess improvements, which also was found unsatisfactory.
Vittal said the challenge for operators is to get things right in problem areas like the lutyens and South Delhi, where bulk of call drops take place. He said Telecom Minister Ravi Shankar Prasad has been very helpful in letting the operators use government sites. Apart from that, there was support from NDMC but still, the problem areas need to be taken care of.
“Our large customer base covers rural, urban, homes and enterprises and we are obsessed about delivering an exceptional experience for each one of them so as to win them for life,” Vittal added.
The investment of Rs60,000 crore will be over and above the Rs1.6 lakh crore it has already invested in its active and passive network, spectrum, fiber, submarine cables and systems till date, Airtel said. “The comprehensive 10 point-programme under ‘project leap’ will enable the company to take a decisive lead in delivering a differentiated customer experience,” it added.
Airtel will expand its mobile broadband coverage to all towns and over 250,000 villages by March, and in three years, it plans to offer mobile broadband to over 500,000 villages in the country. To improve indoor experience, it will deploy a range of solutions including small cells, carrier aggregation solutions, wi-fi and the use of multiple technologies across different spectrum bands.
“Over a period of three years, we plan to deploy over 1,00,000 solutions through a combination of wi-fi hotspots, small cells and indoor solutions,” Vittal said.
Airtel will cumulatively deploy more than 550,000 kms of domestic and international fiber and will swap its legacy networks and base stations over a three year period and replace them with efficient technologies.
The company will also modernise its home broadband network by upgrading its copper assets through new age Vectoring Technology. This technology will enable Airtel to offer 50 Mbps speeds from its current 16 Mbps by 2016.