Customers can now access best-in-class high-speed mobile broadband products via Bharti Airtel, India’s top telecommunications services provider, even in the most remote areas in India. According to the company, Airtel’s 4G network includes 297 cities and 35,674 villages.

In this article, we will take a closer look at how this telecom service provider has managed to develop Airtel network coverage even in the most secluded parts of the country and why.

Bharti Airtel’s Rural Development Strategy

Challenge/ Opportunity

Bharti Airtel was confronted with providing profitable service to rural parts of India. The following requirements need to be addressed by Bharti Airtel, in particular:

• It is estimated that the income of rural Indians is much lower than that of urban Indians. According to data from the Census Bureau, the average revenue per user (ARPU) for rural populations was often less than US$2 per month.
• As part of its network expansion strategy, Bharti Airtel sought to build a cost-effective promotion, sales, and distribution channel to promote its services and offer customer support.
• The huge potential that the Indian rural sector provided and Bharti Airtel’s unique capacity to handle it served as a counterbalance to these difficulties.
• Future development in the Indian mobile industry is predicted to be led by rural consumers, who represent almost 70% of the country’s total population (1.1 billion people), even though only 18.5 percent of the population has access to a mobile phone as of September 2009. The penetration of mobile phones in Indian cities has already surpassed 100 percent.
• Rural residents put a great priority on being able to communicate with one another. Contacting metropolitan or international family and friends sometimes necessitates a lengthy and sometimes perilous journey to the next town to use a payphone.
• According to several studies, higher mobile service saturation in rural regions might have significant socio-economic advantages for the rural population.
• Bharti Airtel is well-positioned to persist development with its stress on under-penetrated Indian areas and new income streams like 3G-enabled data services and pay-TV. With a significant presence in the largely unexplored rural sector (more than 27 percent share of the market as of September 2009), Bharti Airtel is well-positioned to continue growth, including its focus on under-penetrated Indian regions and new revenue streams such as 3G-enabled data services and pay-TV.

Providing connectivity in rural areas for Airtel is an exceedingly difficult undertaking, owing to many reasons, including low incomes of rural consumers, a geographically distributed population, and a public infrastructure that is less than optimal (i.e., roads, electricity, etc).

Alliances/ Partnerships

Bharti Airtel is concentrating on creative strategies to increase its presence in India’s rural regions, including the following:

• Bharti Airtel has entered into microfinance arrangements with Nokia and SKS Microfinance. Bharti provides discounted prices and subscriber identification module (SIM) cards to rural subscribers via these collaborations, while Nokia provides subsidized phones and SKS provides microfinance through these partnerships.
• To extend coverage into rural areas, Bharti Airtel is partnering with Vodafone (which owns 42 percent of the company) and Idea (16 percent of the company) via its joint venture, Indus Towers, to share passive infrastructure services. Bharti Airtel has cut its operational and capital expenditures by sharing infrastructure costs and consumption across various carriers.
• The Indian Farmers Fertilizer Cooperative Limited and Bharti Airtel have also launched a joint venture to provide agricultural fertilizer (IFFCO). To advertise and distribute Bharti’s goods, the company’s partnership, IFFCO Kisan Sanchar, uses IFFCO’s extensive rural presence (represented in 80 % of Indian villages) and widespread popularity within the rural agricultural community.
• The IFFCO Kisan Sanchar program offers subsidized phones and Internet connections at reasonable prices in rural regions. This service also aids Bharti Airtel in identifying and acquiring appropriate areas for the deployment of its cell towers. Additional services include voice-based updates on agricultural prices, farming practices, rural health programs, and “helpline” services, as well as other customized services.

Airtel’s initiatives to provide a fast network in rural areas include efficient infrastructure deployments, growing its distribution network through partnerships, and providing personalized content and prices to customers.

Strategy

To determine the economic feasibility of Airtel in villages (and the neighboring villages), Bharti Airtel first investigates factors such as the source of livelihood, the average income, and participation in regular commercial transactions or travel. The firm has devised a prioritized deployment plan based on the criteria that have been established.

It has also been determined that the following best practices should be followed:

• Bharti Airtel has implemented a direct communication approach to advertise its value offer to rural clients, proven to be effective. Vans are utilized to reach remote regions, with workers on board who teach residents regarding mobile services and their use. To make its services more accessible, the corporation makes all of its promotional information available in local languages worldwide.
• For rural areas, the firm has established a shared phone service known as Public Call Offices (PCOs) to raise awareness of its brand and services among the population.
• Bharti Airtel Service Centers have been established to respond to customer inquiries and concerns, provide Airtel wireless broadband in villages, and serve as sales and distribution sites for the company’s products. These facilities employ individuals from the surrounding area and provide sales and customer support in their native languages.
• The Bharti Airtel network has already developed more than 18,000 service centers in rural India, which serve customers in more than 400 languages and dialects. The firm intends to extend its network in the future.

For each base station, Bharti Airtel monitors the money earned by each of them to guarantee that they are being used efficiently and profitably (instead of ARPU, which is viewed less appropriate in a rural context).

Success Factors

Even though Bharti Airtel does not disclose specific key performance metrics for rural areas, the following figures have been made publicly available:

• Since around April 2010, Bharti Airtel’s network has covered 440,000 townships in India, covering nearly 84 percent of the country’s entire population when combined with its metropolitan services.
• Since March 31, 2010, Bharti Airtel has gained 9 million new users, bringing its total customer base to 128 million. Rural consumers, according to Ovum, accounted for 60% of the company’s net subscriber additions in that quarter.
• Despite Bharti Airtel’s overall ARPU of only about $5, its mobile division earned approximately 30% in earnings before interest, taxation, depreciation, and amortization (EBITDA) and approximately 19% in earnings before interest and taxes (EBIT), indicating a healthy return on overall (such as significant rural) investments.

In 2010, Bharti Airtel focused its efforts on improving its performance in rural areas. In just a decade, they’ve made commendable strides.

A Particular Emphasis On Rajasthan

Airtel’s regional network umbrella includes all major urban, semi-urban, and rural regions and roads, tourist spots, and commercial centers. It has the largest network footprint, including even distant sites such as Myajlar–Jaisalmer, Jaisindhar Station–Barmer, Lagtala–Jaisalmer, and 20BD–Bikaner.

Airtel aims to build out more than 5,000 additional mobile sites throughout the area in FY 2019-20 as part of its networking transformation initiative, Project Leap, to increase network capacity and expand service coverage into rural and disconnected regions. This rollout equates to adding five additional Airtel mobile sites every day across the area.

With this planned expansion, the number of Airtel mobile sites in Rajasthan will increase by 20%, significantly improving the network experience for users. Airtel also intends to construct 600 kilometers of new optical cable in the area, bringing its total fiber footprint to 21,200 kilometers. The deployment of new fiber capacity will aid in the region’s expansion of high-speed data services.

Airtel was the first provider in Rajasthan to introduce 4G/3G services.

Airtel Trials 5G in Rural Areas

Airtel recently performed testing in remote regions of Bramanan village and claims to have reached a download speed of 200Mbps. Airtel conducted the 5G network experiment in this location using Ericsson’s 3GPP-compliant 5G radio.

The 200Mbps speed was obtained using a 5G FWA device that was 3GPP-compliant and was situated more than 10 kilometers from the test location. A commonly available 3GPP-based 5G smartphone was linked to the 5G test network, which produced more than 100Mbps across a 10-kilometer range as part of the testing.

Airtel is thrilled to have exhibited India’s first 5G network and the country’s first 5G cloud gameplay experience, in addition to conducting the country’s first 5G rural experiment.

Conclusion

5G will be a game-changer in terms of extending internet coverage to the last mile through use cases such as Fixed Wireless Access and contributing to a more equitable digital economy. Airtel will remain at the cutting edge of 5G technology and introduce additional India-relevant use cases to the market via collaborations similar to Ericsson’s.

We hope you have a clear understanding of how this telecom provider has successfully established its presence all over India. For more informative articles about network providers, keep visiting Selectra.