TRAI Data shows how far behind Vodafone Idea is in 4G deployment

Even as Vodafone Idea announce big initiatives to expand their network and increase 4G speeds, new data released by telecom regulator TRAI shows that the telco has been left far, far behind by rivals Bharti Airtel and Reliance Jio in 4G expansion over the last one year.

While both Bharti Airtel and Vodafone Idea started off their 4G expansion on an even keel, Airtel has put a surprising amount of distance between itself and Vodafone Idea in recent months.

According to TRAI data, both Vodafone Idea and Bharti Airtel had around 1.25-1.30 lakh 4G cell-sites as of December 2017, which was about 30% of what Reliance Jio had at the time (4.2 lakh).

Over the next one year, Airtel added around 1.13 lakh new 4G cell sites to end 2018 with around 2.43 lakh LTE sites. By then, it had 38% of the number of 4G sites that Reliance Jio had (6.46 lakh).

However, during the same one-year period (2018), Vodafone Idea added only 43,000 4G cell-sites. In other words, its addition was only 38% of the number of new 4G cell-sites installed by Bharti Airtel.

While part of the reason may have be the uncertainty related to getting the final nod for the merger of Vodafone and Idea — which finally came through only in August 2018 — the pace of expansion has been dismal even after the merger was complete.

In the nine months since the merger was completed, Vodafone Idea added less than 9,000 new 4G cell-sites, according to TRAI data. During the same nine months period, Bharti Airtel added 1.12 lakh new 4G cell-sites and Jio added 1.55 lakh new 4G cell-sites (eNode-B).

As of the latest three-month period for which figures are available, Bharti Airtel now has almost twice as many LTE cell sites (3.27 lakh) as Vodafone Idea (1.76 lakh).

Looked at another way, Bharti Airtel has increased its cell-sites to 44% of Jio’s number, while Vodafone Idea has fallen to 23.6% from about 30% in December 2017.

In other words, while Bharti Airtel has narrowed the gap between itself and Jio in terms of share of total 4G base stations, Vodafone Idea has been losing share.

The only silver lining in Vodafone Idea’s numbers is that the company has started growing its 4G base stations again in the latest quarter, after keeping it largely static for the previous nine months. In the three months from April-June this year, Vodafone Idea added around 8,100 new 4G cell-sites, compared to just 800 new ones in the previous six months.

While this was an improvement compared to previous quarters, it was still a far cry from the nearly 36,000 new eNode-Bs that Airtel added during the same three months and the 46,000 4G sites that Reliance Jio added.

The exact reasons for the startling underperformance is not clear, but it most likely has to do with the rejigging of Vodafone and Idea’s cell towers.

Vodafone Idea has, since it got the green signal in August last year, been busy de-duplicating its network by removing excess base stations from across the country.

Since the company had two each of 2G, 3G and 4G networks in most places, its first priority was to merge each of these two networks into a single network and to remove any excess equipment.

In most cases, the company did not need to remove equipment, and has successfully integrated both sets of equipment into a single network with enhanced capacity. In other areas, it has been able to simply take one set out and move all its subscribers to the other.

Secondly, even without adding many towers, the company has also been able to increase its network capacity over the last one year by merging the spectrum of Vodafone and Idea networks.

By pooling two sets of spectrum together, the company is estimated to have doubled its 4G capacity over the last one year, even though it has increased the number of cell-sites by only around 13%-14% during the same period.

Moreover, unlike cell-site expansion, pooling spectrum together does not increase the company’s operating expenses.

Given the huge benefits arising of the spectrum and network merger — and the effort and management focus required to carry it out — the company is likely to have put the matter of installing new 4G towers on the back-burner for now.

The integration, however, is likely to get over in the next six months, after which Vodafone Idea too will have to keep adding new towers to increase its network capacity.

Still, in terms of sheer capacity and size, Bharti Airtel has managed to leave its immediate competitor far behind over the last one year, going by TRAI’s numbers.

In anticipation of the coming network expansion, Vodafone Idea recently raised around Rs 25,000 cr from stock investors by selling fresh stock, most of which was purchased by its promoters Vodafone Group and Aditya Birla Group.