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Airtel takes a big leap, doubles subscriber gap with closest rival - Sathish - 02-20-2009

Bharti Airtel, India's largest telecom company in terms of subscribers, claimed it has doubled the gap with its nearest competitor.

Speaking to Business Standard, Bharti Group Chairman Sunil Mittal said, "Even at this time of slowdown, we continue to move ahead. We have about 90 million subscribers now and we have widened the gap with our nearest competitor from 10-12 million to over 25 million."

He further said, "Now, it is not market share but the revenue share which is the main indicator. In revenue, we lead with a 30 per cent share of the market.''

The company is also prepared to roll out its much-awaited third generation (3G) services in six months from the allotment of the spectrum, he said.

Auction of the spectrum has been deferred indefinitely to the next financial year on account of unresolved issues pertaining to the reserve price of each block and the number of blocks to be auctioned. While the Department of Telecom (DoT) had recommended a reserve price of Rs 2,020 for pan-India operations, the Ministry of Finance had asked to double the price.

Commenting on this, Mittal said, "The auctions will have to have a reasonable price to get a nice response. And the government holds the right to cancel the tender any time. If the reserve price is reasonable, then we will do it (bid) everywhere...We have ample funds and if required, we will borrow. Rolling out of the of 3G spectrum will require large amounts of money."

However, he said that the company had no plans to raise funds at present, even as the government recently eased the norms of foreign direct investment in the country.

"It is good to have a policy that is easily understandable. But, since we have no plans to raise funds, we are neutral about this. It is good to have clarity, it allows foreigners to have clear understanding about how to invest in the country." Unfazed by the entry of new telecom operators and the expansion of CDMA players in the GSM market, Mittal said, "The new operators will have to make large investments. We will see how that happens. Our brand is strong and our tariffs completive. The new GSM players just increase the market size, which is good for the development of the ecosystem." He also clarified that the company's plans for a foreign acquisition were on the back burner. " Foreign acquisition is not on the radar right now. Since market valuations are low, companies are not willing to sell. We have been on the lookout for acquisitions in the last 2-3 years but nothing has worked out so far." Mittal further said that the company would not be looking at developed countries for acquisition since the potential for growth is limited in these countries. Bharti is also bullish about its DTH business which was launched in October last. "The response to DTH has been very good. We have expanded to 92 cities. We add about one lakh customers a month. We have over 3 lakh subscribers now."