17 WWW.ECONOMICTIMES.COM Companies Airtel Gears Up for Battle to Protect ARPU

Kalyan.Parbat @timesgroup.com Charging Up

Kolkata: is bra- Airtel also looks to cing for a gruelling battle to monetise tower assets in 5 protect its average revenue per African markets — having user (ARPU) and maximising already done so in 10 out revenue market share (RMS), of 15 it is present in as the telecom market leader tries to weather the brutal im- Telco to pact of Reliance Info- generate comm’s free services that it additional calls “predatory” and expects ` to continue through March. 4,080 cr The company is also looking to beef up to monetise tower assets in five war chest African markets — having al- ready done so in 10 out of the 15 Co’s ARPU in it is present in — to generate an the just-ended additional up to $600 million quarter fell 8.4% `. sequentially ( 4,080 crore) to beef up its war ` chest as the price war with Mu- to 172 kesh Ambani-controlled Jio is expected to escalate. “With predatory pricing unle- ashed by an operator, it’s going to be an ARPU game going for- with innovative “bucket plans ward, and all about maximising that deliver value and lock the RMS in an industry that will see right ARPU customers” into its rapid consolidation over the network and grow RMS, which next 12-15 months,” managing would be the key performance director for & South Asia metric, going forward. Airtel’s Gopal Vittal said on Wednesday, ARPU in the just-ended quarter without naming Jio. fell 8.4% sequentially to `. 172. He expects the total number of Brushing aside analyst con- telecom players to “shrink ra- cerns about plunging data re- pidly in the short-to-medium venue yields at `. 50 per GB, hit term” as smaller operators are by Jio’s freebies, Vittal said likely to increasingly struggle there’s adequate data elastici- against the Big 4 of Airtel, Voda- ty in the market, which can still fone India, and Jio pave the way for greater data in rolling out comparable bro- consumption, and in turn, help adband networks and also face maintain ARPU levels. bigger financial challenges. Vittal ruled out the immedia- Vittal was speaking on an ear- te possibility of Airtel unvei- nings call a day after the com- ling an aggressively priced pany reported a 55% fall in to take on Jio, as- third-quarter net profit to `. 504 serting that such a device is un- crore — its worst in four years likely to appeal to serious data — amid a first ever on-year re- customers and will primarily venue drop, hit by the impact be sought out by people looking of Jio’s free services and partly for cheap data. Jio’s parent Re- due to demonetisation. liance Industries is believed to Analysts said No. 3 Idea, be working on an ultra-cheap which is expected to report re- 4G feature phone to attract mo- sults shortly, could perform a re subscribers at the lower end. lot worse than the market lea- The market leader’s global fi- der, with most estimating a net nance head, Nilanjan Roy, said loss, which will be the first ever the telco’s consolidated capital in the telco’s history. expenditure guidance for fi- Vittal said Airtel’s immediate scal 2017 will likely be a tad be- objective would be coming up low $3 billion. Handset Makers Seek Localisation Incentives

Budget sops will help achieve the govt’s Make in India objective, say cos

Gulveen.Aulakh @timesgroup.com GETTY IMAGES New Delhi: Mobile-phone ma- strengthen the manufactu- kers operating in India are loo- ring base. Tax holidays and du- king up to next week’s Union ty exemptions on capital goods Budget for localisation incenti- imports are other items on the ves to help achieve the govern- wishlist of companies that are ment’s ‘Make In India’ objecti- potentially at the vanguard of ve and to overcome demand efforts to make India an export disruption concerns brought hub for electronics. about by recent currency cont- Mobile phones are at the fo- rols and imminent changes in refront of Prime Minister Na- the indirect-tax structure. rendra Modi’s ‘Make In India’ “A ten-year tax holiday for lo- initiative, and tangible locali- cal mobile manufacturers, sation for the industry has led continued diffe- companies and in- rential duty Budget 2017 dustry lobby-gro- structure to enco- ups to seek similar urage enhanced local manu- incentives for related pro- facturing in India and an in- ducts. Industry expects local crease in incentives under the manufacturing to feature pro- Merchandise Exports from minently of the Union budget India Scheme (MEIS) scheme agenda ahead of the proposed to five percent from the cur- implementation of the Goods rent level of two percent wo- and Services Tax (GST), uld go a long way in making which is billed as the biggest India an export hub,” said Ri- tax reforms in independent tesh Suneja, Group Chief Fi- India. The Budget follows the nancial Officer at Lava. demonetization initiative an- Suneja echoes the sentiment nounced Nov. 8. of an industry that requires Furthermore, the industry policy support to make mobi- wants the February 1 Union le-phone handsets cheaper in Budget to redraw electronic- Asia’s third-biggest economy, waste norms which put the onus where the government is see- of managing end-of-life electro- king to draw capital in indu- nic products on producers – so- stries as diverse as electronics mething the industry believes is and defence equipment to regressive and arbitrary.