Bharti Airtel Limited, popularly known as Airtel is an Indian multinational telecommunication service provider, the second-largest network operator in India and fourth-largest in the world having a subscriber base of 439.84 million and a presence in 18 countries across South Asia and Africa. Its telecom service portfolio includes such as fixed, mobile, International Long Distance (ILD), National Long Distance (NLD), Very Small Aperture Terminal (VSAT), internet and network Solutions. Airtel is the first operator to operate in all 22 telecom circles across the country with a market share of 28%. Let’s get into Airtel and its success story.
Pioneering the business model
The asset-light business model that almost all telecom operators use today is the gift of Airtel to the Industry. Airtel introduced the business model where it outsourced all the business operations except sales and finance and marketing which Airtel believes to be its core competency. Airtel focuses only on Customer Acquisition and Retention and business expansion. All other business processes like hardware, network management, billing (and other backend services), value-added services and even managing the telecom infrastructure, are outsourced. The IT support is outsourced to Amdocs and hardware equipment is provided and maintained by Huawei, Ericsson, and Nokia Networks. Similarly, transmission towers are handled by Bharti Infratel and Indus Towers.
Airtel not only pioneered this type of business model but also mastered it. Having seen Airtel’s success, almost all other telecom operators followed the suit. This model is not only responsible for Airtel being the fastest growing company but also being the most innovative one since the sole focus is on customer experience and business development.
Competing with a formidable rival: Jio
In a war to control India’s booming mobile service market, Airtel seemed to be in a precarious condition in the face of a juggernaut unleashed by Mukesh Ambani. The rollout of Jio, not only knocked Airtel from the top position but also shrank the industry to three players from more than 12 players that existed before Jio’s entry. Airtel struggled to add subscribers after Jio managed to lure in more than 300 million (a quarter of the total subscriber base) subscribers offering free calls and cheap data.
Also Read: Reliance Jio – The History And The Historic Launch
The initial setback suffered by Airtel has not deterred the expansion plans of Airtel. Bharti Airtel is ahead of its arch-rival Jio in terms of many usage metrics. An Airtel user consumes 16 GigaBytes of data per month and voice usage stands at 1,006 minutes per user per month whereas the same figures are 12 GB and 776 minutes for Reliance Jio. Average Revenue per User (ARPU) stands at INR 162 for Airtel and INR 145 for Jio.
Airtel has introduced several apps and add-on digital services to provide access to OTT content and digital TV. These were developed for more active user profiling, primarily 4G users. Jio already had more than 30 apps like Jio Meet, JioSaavn, My Jio, JioTV, etc. The big push for Airtel came with the launch of music streaming service Airtel Wynk and Airtel Digital TV. Other apps that pushed user engagement and acquisition were:
| Music Streaming | Wynk (100 million+ downloads) |
| TV | Airtel Xstream (126 Million downloads) |
| Video Conferencing | Blue Jeans |
| Cloud Service Partnership | Google Cloud and Amazon Web Services |
| Home Broadband | 2.6 million |
| Telecom Subscriber Base | 321 million |
| ARPU | INR 162 |
This vast web of digital services created by Airtel will help in creating a user base that Airtel aims to monetize through product partnerships. Airtel is known for out of box thinking just as it introduced a bundled plan with in-built life insurance cover, in partnership with HDFC bank. More than 165 million users are active on the digital service web of Airtel.
Expanding into uncharted territory to fuel growth
Airtel plans to leverage the network of touchpoints across Airtel Stores, distributor network, and telecom subscribers. Airtel plans to build its payments bank as a connecting point across its app universe. Airtel’s Payment bank is among the top three in the space with an added early mover advantage. Though Jio has also partnered with SBI for Jio Payments bank, it is almost invisible in the market.
In B2B market, Airtel plans to offer tech solutions to enterprises. Presently 21% of its revenues are coming from enterprises by offering communications and cloud services to them. It is looking forward to offering customer service solutions and security services also. This includes Airtel IQ, an omnichannel solution for businesses to integrate services.
As a cloud service provider, Airtel has long-standing customer engagements and now Airtel is focusing more on providing these solutions to Small and Medium Businesses.
Acquisition of startups
Airtel has trodden carefully and has certainly taken baby steps in its approach towards startup acquisition. The Airtel Startup Accelerator has acquired small stakes (in range of 10%) in some companies like HR tech enabler Vahan, ed-tech firm Lattu Kids, and AI company Voicezen. Airtel also partnered with Akash educational services, which is the only consumer-facing edtech initiative.
The onset of new technology: 5G
With 5G approaching mankind at a rapid pace, it remains interesting to see how will Airtel manage to survive in the market at a time when it is still coping with massive debts. On the other hand, its arch-rival Jio is more than ready for a 5G spectrum with zero 2G-3G solution and a host of 5G startups in its kitty. Though the environment seems to be more conducive for Airtel’s competitors, successful data monetization strategies like growing the smartphone user base beyond the current 60% can help Airtel build a holistic revenue stream.
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