Friday, 17 August 2012

Airtel maintains subscriber status quo

Airtel's revenue from its operations in Africa grew 31.5 percent, but the company continues to suffer a net loss in Africa in the quarter rose to INR 6.7 billion (USD 121.2 million), compared to a loss of INR 3 billion (USD 54.3 million) in the same quarter 2011. 

This is despite Airtel claiming that the number of mobile subscribers it has in Africa rose to 56 million from 46 million a year earlier (using Airtel’s criteria).

Airtel uses a 30-day activity criteria, as opposed to the more widely accepted measure of 90-day activity. 'Africa & Middle East Telecom-Week' mobile database reckons that, using the 90-day measure, Airtel had approximately 62.7 million subscribers at the end of June.

However, benchmarking Airtel's performance against the overall market suggests that Airtel had a 10.4 percent market share at the end of June 2012 - only 0.3 percent percentage points more than it had immediately after the acquisition of the Zain assets, and underlining the failure of Airtel's deep discounting strategy intended to win share aggressively and so stimulate its 'minute factory' model.

Airtel Africa Mobile Subscriber Market Share 2Q12 v 2Q10  
 Source: industry sources, Blycroft estimates c. Blycroft 2012

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