BSNL, MTNL lose to private players in MNP race

Net outgo is 5.84-lakh subscribers for the former, 55,605 subscribers for the latter

Mobile Number Portability (MNP), launched by Prime Minister Manmohan Singh amid much fanfare in January this year, is hurting the Bharat Sanchar Nigam Ltd (BSNL) and the Mahanagar Telephone Nigam Ltd (MTNL) as the number of subscribers leaving these two state-run telecom companies is far higher than those opting for their mobile services.

According to the latest government figures, so far the BSNL has lost 9.33 lakh subscribers to private players due to MNP, while only 3.49 lakh users joined it. Therefore, the net outgo for the BSNL so far has been over 5.84-lakh subscribers. Similarly, in case of the MTNL that operates in Delhi and Mumbai circles, 67,198 of its subscribers opted for private players, while only 11,593 switched to its services under MNP, resulting in net outgo of 55,605 subscribers.

No longer at top

From being the top mobile operator a few years ago, the BSNL has been gradually losing its position in the Indian mobile market that is adding over 1.5-crore subscribers every month. With 9.28 crore subscribers, the BSNL is currently placed at fifth position with just over 11 per cent market share. In May 2011, it added 8.23 lakh new subscribers. The MTNL also seems to be losing the race in the two metros where it has 55-lakh subscribers and is adding just over 25,000 new subscribers every month. Compare this with market leader Bharti Airtel, which has almost 20 per cent market share with 16.70 crore subscribers and is adding almost 25-lakh new subscribers every month.

Clearly, both the BSNL and the MTNL are losing out to private operators. First they saw rapid decline in their landline connections as mobile revolution started picking up 6-7 years ago; and now MNP is creating more problems for these two firms.

Drop in market share

In March 2008 the BSNL had a market share of 80 per cent in landline market and 15.64 per cent in mobile market (24 per cent in overall telecom market), which fell to 73.71 per cent and 11.53 per cent respectively by December 2010 (14 per cent overall). From reporting a healthy profit of Rs. 3,009 crore in 2007-08, the BSNL reported a loss of Rs. 1,822 crore in 2009-10.

The same has been the case with the MTNL — from 65 per cent market share in Delhi and 78 per cent in Mumbai in landline in March 2008 to just 55 per cent and 64 per cent respectively by December 2010. In case of mobiles, its market share has declined from around 10 per cent in Delhi and 14 per cent in Mumbai to 7 per cent and 8 per cent respectively by December 2010.