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    BSNL and MTNL lag behind private telecom companies in connection sales

    Synopsis

    The surge in mobile connections by private operators boosted national tele-density to 75.51% in May this year from 73.33% a year ago.

    The surge in mobile connections by private operators boosted national tele-density to 75.51% in May this year from 73.33% a year ago.
    KOLKATA: Private telecom carriers sold over 48 million new connections between May '13 and May '14 while state-owned Bharat Sanchar Nigam (BSNL) and Mahanagar Telephone Nigam (MTNL) jointly lost nearly 10 million during the period, struggling to keep pace with their fleet-footed rivals, says an internal Telecom Commission memo seen by ET.

    Telecom Commission is the highest decision-making wing of the communications ministry. Though state-owned BSNL and MTNL still hold sway in the landline space with a combined market share of 77.04%, BSNL lost nearly 2 million landline customers during the period while MTNL barely managed to hold on to its 3.5 million-plus wireline connections as on May this year.

    BSNL, which desperately needs cash to upgrade its landline network, has been losing 1.4 lakh wireline customers every month. So much so, its landline customer base -- now roughly 18.2 million - has shrunk by 40% over the past decade.

    The TC memo observes that private telcos accounted for nearly 88% of total phone connections (landline and mobile) sold while the share of the two telecom PSUs had shrunk to 12.44% in May this year from 14.05% a year ago.

    Accordingly, net growth in total phone connections (landline and mobile) in the telecom industry is roughly 38.3 million, dragged down by the near 10 million combined connection losses suffered by BSNL and MTNL during the period under review.

    The dominance of mobile connections over landlines also continues; mobiles account for nearly 97% of total phone connections buoyed by reduced competition in the sector over the past four quarters which has allowed private mobile carriers to raise effective call rates by reducing free minutes, apart from growing data usage.

    According to the TC note, the spurt in mobile connections growth was propelled by market leader Bharti Airtel, Vodafone India, Idea Cellular and Reliance Communications, while BSNL and MTNL collectively lost nearly 8 mobile million connections between May '13 and '14.

    The surge in mobile connections by private operators boosted national tele-density to 75.51% in May this year from 73.33% a year ago, the note shows.

    Rural teledensity during the period has also improved to 44.45% from 41.7%, reflecting increasing share of new rural connections even as country's biggest telcos look beyond the urban markets for new customer acquisitions.
    (Catch all the Business News, Breaking News Events and Latest News Updates on The Economic Times.)

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    3 Comments on this Story

    Sachin hukeri2123 days ago
    Tie child with ropes of rules tenders, woman limited timeings to work and say him to run. What will happen?
    Romeo Here2174 days ago
    The decrease in land line connection is directly proportional to increase in mobile connection. so the logic of 40 % decrease over a decade is some what flawed.
    Amit2174 days ago
    They will never until they shed their Babugiri. MTNL has the highest amount of spectrum available with them. However, when you call a MTNL number 6 out 10 times you will get the message "Number is out of coverage area or switched off".
    The Economic Times