The Telecom Sector in India is in a state of flux, dominated by two fierce competitors, Reliance Jio and Bharti Airtel, while the underdog, BSNL, is making an unexpected comeback. Jio and Airtel have long battled it out as the market’s major players, but recent changes in pricing have shaken things up. With private telecom giants hiking their tariffs, BSNL, the state-owned company, has found itself as an affordable alternative, attracting many price-conscious consumers. This pricing shift isn’t just a minor adjustment, it has spurred a customer migration, putting BSNL in the spotlight and prompting the question: Can the state-run provider hold its ground against the giants?
When Prices Go Up, Customers Look Down
Why were consumers shifting in the first place? Price hikes. In July, Airtel and Jio raised their recharge prices, citing rising costs and the need for sustained investments in infrastructure. This move, however, didn’t sit well with their users. Facing more and more expensive mobile plans, many customers shifted to BSNL, whose relatively stable pricing became a plus point for those unwilling to spend more of their cash. As a result, Reliance Jio, Airtel, and Vodafone-Idea (Vi) all saw significant customer losses, while BSNL recorded a sharp rise in subscriptions. In a month of drastic change, Jio and Airtel lost 750,000 and 1,690,000 users respectively, while BSNL added nearly 3 million new customers.
In terms of market share, BSNL's share increased from 7.59% in July 2024 to 7.84% in August 2024. Meanwhile, private telecoms continued to experience a decline in market share. Reliance Jio, which had 40.68% in July 2024, dropped to 40.53% in August 2024. Bharti Airtel, which had 33.23% in July 2024, fell to 33.07% in August 2024. Similarly, India’s third-largest telecom operator, Vi, which had 18.46% in July 2024, decreased to 18.39%.
However, BSNL isn’t just winning users through competitive pricing, it’s also upgrading its service offerings. BSNL’s standout prepaid plan, priced at Rs 249, offers a generous 40 days of validity, beating Jio and Airtel's standard 28-day cycle. This plan not only provides 2GB of daily data but also boasts unlimited calling and 100 SMS per day, which are ideal features for cost-conscious users. Furthermore, BSNL is rolling out 20 new 4G towers in regions like Ladakh, which not only improves civilian connectivity but also enhances communication for the Indian Army in remote border areas. With these strategies, BSNL is solidifying its value proposition as a cost-effective, reliable option in the telecom market compared to its counterparts.
Airtel and Jio Plan to Hold Their Ground
While BSNL attracts customers through affordability, Airtel and Jio still dominate in terms of network speed, reach, and 5G capabilities. In response to BSNL’s growth, Airtel has been investing heavily in 4G and 5G infrastructure, even in smaller towns and cities, to retain high-paying customers and attract new ones. Notably, Airtel has been the only private player to increase its 4G and 5G customer base, adding 2.56 million users in July, even as Jio and Vi faced declines. Both Airtel and Jio are focused on expanding their higher-end services, hoping the 5G market will be a game-changer in maintaining customer loyalty despite higher prices.
The shift in consumer base has also revealed an interesting pattern of consumer behaviour. For many, price remains the deciding factor, especially among low-income and rural customers who are more likely to switch providers in response to price hikes. Airtel’s CEO even noted that the company has seen “SIM consolidation” at the lower end of the market, where customers maintain multiple connections but now are cutting back due to cost concerns. This phenomenon indicates a trend where subscribers might opt for BSNL as a secondary, cheaper connection to stay connected without overpaying.
The Problem of Keeping Active Users Engaged
In the case of telcos, it is important to hold on to active users, those users who use the network on a regular basis and pay for it, so that the revenue is sustained. BSNL has witnessed a healthy growth of active user base within its fold and has added 2.91 million active users in July alone. On the contrary, Airtel, Jio and Vi reported a decline in active users which indicates that BSNL is not only the brand for the price-sensitive customers but also for much more active users. On a weekly basis, data released by the Telecom Regulatory Authority of India (TRAI) exposed that mobile number portability requests increased tremendously as millions of people were in search of better deals; hence, a consumer base that is brand agnostic and appreciates value for money.
BSNL’s Technological Advancement: Speed of the 4G-5G Regime
This competition is fierce for BSNL, especially because it has one of the oldest structures, and it's only covering a few states with 4G when its competitors are deploying 5G. Overall, there has been an upward shift in BSNL’s customers with the inclusion of 4G services, however, it is still an underdog when it comes to the speed and reach of advanced services. Nevertheless, BSNL widened its base of 4G networks strategically into regions that were not connected. There is a demand from customers residing in these areas who though are not so tech-savvy, seek connections and availability.
The Ongoing Struggles in the Telecom Industry
The recent changes in the telecommunications sector in India point out the terrain is evolving in the sense of the customers who are price-driven and investors who are in for expansion purposes. While Jio and Airtel are present in the value service market, 5G-enabled and high-quality networks of BSNL assist the company’s growth in the low-end market. The war continues in the Indian telecom sector as operators change their approaches to sustain themselves in the market.
The Future of Inclusive Connectivity in India’s Telecom Sector
India’s telecom future is set for a shakeup as BSNL steps into the 5G game. While Jio and Airtel focus on premium urban markets, BSNL is likely to bring affordable 5G to rural and underserved areas, bridging connectivity gaps across the country. This move could redefine BSNL as a champion of accessible high-speed internet, adding fresh competition and variety to the market. As 5G spreads, the market will likely experience tailored options for all kinds of users, from price-conscious rural consumers to tech-savvy urban ones, making India’s telecom landscape more inclusive and dynamic.
Author: Kanika Jakhmola and Chirag Agarwal Illustration: Dhruv Garg
SOURCES
Economic Times
Business Today
Indiatvnews
The New Indian Express
