After listening to Nira Radia and Ratan Tata’s conversation where Ms Radia explains to Tata about Airtel alleging that Anil Ambani is forging subscriber numbers to amass spectrum. The TRAI woke up and conducted an audit of Active / Real Wireless Cell Phone Users across India and the findings have taken everybody by surprise.

The active wireless user base in India (477m) is 70% of the actual reported subs base (682m). Here is the real perecentage of Active Subscriber base for each operator,

  • Bharti Airtel (89%)
  • Idea (incl.Spice, 88%),
  • Vodafone (75%),
  • RCom (67%),
  • BSNL (59%),
  • Aircel (59%).
  • MTS  Sistema’s 46%
  • Etisalat 45%
  • Videocon, Unitech and S–Tel are 44%, 39%, 31% and 24% respectively.
  • Tata Tele’s active sub percentage is 45%. The company has clarified that its active subs base is not comparable as it uses  7 days of data vs. 30 days by all others in the industry

India’s real mobile penetration is 40% (vs. reported 58%). New operators are struggling, as evidenced by very few active subs.  Bharti & Idea managements are conservative in accounting for their subscribers.

Thus we expect that the change in telecom minister is likely to result in speedy resolution of outstanding regulatory issues such as 2G spectrum pricing, M&A guidelines, and future of new entrants who have got spectrum but have not rolled out services. Regulatory changes should be positive for incumbents.