Hitender Kumar, Aircel’s circle business head for Bihar
With a teledensity of only 55 per cent, Bihar is amongst the most challenging telecom circles in the country. Despite this, Aircel has managed to turn EBITDA (earnings before interest, taxes, depreciation and amortisation) positive in the circle, with Bihar now contributing around 5 per cent to the operator’s revenues. In an interview with tele.net, Hitender Kumar, Aircel’s circle business head for Bihar, talks about the company’s performance, key growth drivers, challenges and plans…
How has Aircel performed in the Bihar circle?
In this hypercompetitive industry, Aircel has been the fastest growing telecom brand in Bihar. We have gained 1.7 per cent revenue market share in just two years, which speaks volumes about our innovations with our products and services. The past nine months have been very exciting as we have added a sizeable 3.5 million new customers to our network, which has helped us turn EBITDA positive on a year-to-date basis.
How are Aircel’s strategies for this circle different from those for the rest of the country?
Bihar is an extremely challenging and price-sensitive market. For us, the focus has been on network modernisation and the launch of value-for-money products. We have made significant investments in our network, but our tariffs are still the lowest in the country. We have been upgrading various interfaces to IP interfaces, and this has significantly helped us improve network efficiency and enhance the customer experience. We have also invested in network software upgrades, which has helped us modify the network based on the traffic and subscriber behaviour. We are adding 2G and 3G sites wherever necessary. On the product front, we are constantly innovating with pocket-friendly packs and catering to specific customer requirements to make Aircel the most affordable brand in Bihar. For instance, we have launched a night pack, a one-day pack, a weekly pack, a fortnightly pack, a monthly pack and an SMS pack.
What are some of the recent initiatives taken by Aircel in the circle?
We have launched unlimited calling and data offers starting at Rs 13. We have entered into various partnerships, such as with Micromax as a technology partner to launch the industry’s first 3G music smartphone, Canvas Beat. We have rolled out unified pricing for 2G and 3G customers. We have launched Aircel 3G Mornings, a trial 3G offer, which allows customers to access unlimited 3G data in the morning hours. We have introduced Paper Recharge, an industry first that gives an online shopper the option to buy a data recharge pack priced at Rs 602 with 7 GB data, and a pack priced at Rs 402 with 3 GB data and Rs 100 talktime from Snapdeal. We are in talks with other e-commerce vendors as well for similar deals.
What are the challenges that Aircel faces in the circle?
The challenges for Aircel are the same as those for the entire industry. Any competition is an opportunity to grow. We need to be profitable, and deliver the best experience and products to our customers. The entry of new players in the 4G market will work as a catalyst for 4G subscription and usage uptake. We see players as complementing forces to boost mobile broadband growth. But with more consumers getting on to the 4G network, 4G speeds have come down to 3G. I think the real uptake of 4G is still some time away.
The rural internet market is still primarily driven by 2G and we want Aircel to become a gateway to 3G for them. For the urban masses, we will focus on delivering a high speed 3G experience. We are also strengthening our network to ensure seamless connectivity and will work on offering bucket plans to our customers.
What are your short- and medium-term revenue targets for the circle? How do you plan to expand your operations here?
The market remains hypercompetitive due to the entry of a new player. However, with competition, we also see an opportunity to grow. Our short- and medium-term targets are to achieve double-digit year-ending growth. We are still innovating in the 3G space where we believe there is still a lot of room for innovation. The penetration of 3G devices has grown to 32 per cent and 3G subscribers comprise 55 per cent of Aircel’s overall data users. Around 53 per cent of mobile data is spent on video and audio services, 22-25 per cent on social networking and 20-24 per cent on other services. Aircel is taking the lead in driving mobile internet uptake with its “Be Online with Aircel” initiative. Data consumption by Aircel customers has seen a dramatic increase over the past few years. Our unmatched offerings have helped us record 74 per cent 3G data revenue growth and 76 per cent consumption growth in 2016. We are aiming to maintain and build on these figures
