India saw its total mobile subscriber base go into decline in the second half of 2012, falling dramatically to 865 million by year-end. This was down from 934 million in June, delivering an almost 8% fall in just six months. The major reason for the decline has been the move by operators to delete inactive mobile subscribers from their databases. One operator, Reliance, for example, deactivated those subscribers that had not used their phones in two months; this operator removed a massive 20 million subscribers (or 13% of its subscriber base) in July alone. Other operators have been making similar cuts although not with such dramatic consequences. Of the 7 million ‘lost’ subscribers recorded for August, Bharti Airtel, Vodafone, and Idea Cellular – which between them account for around 68% of the total subscriber market – lost over 5 million subscribers.
The move to cut inactive subscribers indicates a major business shift by operators towards boosting Average Revenue Per User (ARPU) and away from the idea of simply adding subscribers to their networks. This is generally seen by the industry as a sensible business move that will see benefits flowing to both the operators and the customers.
It should be noted that the initiative was not totally from the operators’ side. In its regulatory role, the DoT had been asking operators to clear their databases of unused numbers as there is a crunch coming in the supply of mobile numbers. This is clearly a major factor in the changed approach. The government has also been stressing that it will make procedures for people to acquire a mobile number more stringent and therefore databases will need to be up to date.
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