Bharti Airtel, India’s largest mobile operator, recently announced plans to spend INR600bn (almost $9bn) over the next three years to upgrade its fixed and mobile networks under its new Project Leap program. But as it tries to widen its lead in its home market, it may be preparing to pull out of many of the African operations it acquired from Zain in 2010, perhaps with a sale to Orange.
Project Leap will see Bharti doubling the footprint of its mobile network, with a particular focus on urban LTE, WiFi and rural expansion. It will also deploy a fiber-to-the-home network and will harness a combination of fiber, small cells and WiFi to improve indoor coverage. This is very poor in many parts of India and limits the operator’s ability to offer premium services, especially to enterprises.
“Our large customer base covers rural, urban, homes and enterprises and we are obsessed about delivering an exceptional experience for each one of them,” said Gopal Vittal, CEO of Bharti Airtel India & South Asia, in a statement. “We are confident that this new initiative will deliver a truly differentiated customer experience and reinforce our commitment to build a future-ready network.”
The company will deploy more than 160,000 base stations over the next three years, using new compact Single RAN designs which will reduce power consumption by up to 70%. It will double its current macro footprint, plus adding 10,000 hotspots and small cells indoors. By March 2016, it says it will provide mobile broadband coverage to every town in India and 250,000 villages, with a further 250,000 villages added by the end of 2018. It says it will connect every small and medium enterprise either with fiber, vectored copper or LTE in the same period.
Also on the carrier’s mobile shopping list are some of the emerging technologies that will make sense of all this infrastructure – SON (self-optimizing networks), SDN (software defined networking), location aware planning tools and customer experience management (CEM) solutions.
“We are confident that Project Leap will help Airtel build a smart and dynamic network that will significantly improve the quality of both voice and data services across the length and breadth of the country,” Vittal said.
One way to pay for all this, and to enable Airtel to support far better QoS and ARPU at home, is to sell some or all of its 17 sub-Saharan African subsidiaries. It has already indicated its desire to leave four of the markets it acquired from Zain – Burkina Faso, Chad, Congo Brazzaville and Sierra Leone. Earlier this year, it said it was in exclusive talks with Orange about those assets, which would fit well into the French giant’s footprint. Orange is one of the most active externally based operators in Africa, but has been rationalizing its presence around Francophone north and west regions, while exiting some countries where it has limited market share, such as the eastern territories of Uganda and Kenya.
No update has been given on the progress of talks, but the need to sell will be more urgent in light of Project Leap, and of widening losses in Airtel’s African region. These were $124m in the third quarter of 2014, but leapt to $170m in the same period this year, while revenues fell from $1.14bn to $967m amid tough currency and market conditions.