Bharti Airtel Ltd plans to phase out its 3G service in two years and upgrade all subscribers using the service to faster 4G networks in a move that will help India’s largest telecom operator save on costs and improve user experience.
The company plans to migrate all its 3G users across the country to 4G services, based on the VoLTE communication standard, over the next few months, a person with direct knowledge of the matter said.
The entry of Reliance Jio Infocomm Ltd, with its all 4G network, in September last year, has accelerated the end of 3G in India. The ubiquitous availability of cheap 4G-enabled devices has also made it easier for companies to plan a complete shift to a 4G-only network.
“What we need is that every base site that we have, we need to add a new technology so that the rollout that we are doing currently is almost entirely on 4G. Our 3G rollout is over and I would say 3G in anyway in 2-3 years, we will have to shut it down. Our 3G network will also shift to 4G. And these are mostly software switches,” the person cited above said, requesting anonymity.
The VoLTE standard reduces cost of operations and offers better customer experience, according to telecom experts.
An Airtel spokesperson said the company believes “that 3G networks will get phased out in India well ahead of most countries in the world”.
“All new smartphones being shipped today support 4G (along with 3G) and given that 4G technology is much more spectrally efficient compared to 3G, the progression to 4G will be logical for operators. We would, however, not like to comment on speculation regarding our network plans,” the spokesperson said.
Indian operators invested significantly in 3G network and spectrum from 2010 to 2015. Slow uptake of 3G in India means a lot of that investment has not been fully recovered. From a subscriber standpoint, they are mainly concerned about the quality and speed of data connectivity and not the underlying technology.
Globally, some operators such as Verizon and Telenor have considered shutting their 3G networks to simplify their network architectures. However, this has happened in countries where 3G networks have been operational for a long period of time—about 15 years—and the operators have recovered costs. In some countries such as Indonesia and Thailand, 3G continues to be a focus area even as 4G has been introduced.
The fundamental reason to have VoLTE is that when a customer is on a 4G layer and if he keeps dropping from 4G to 3G or to 2G, and going back, the experience is not great.
“We would ideally like to keep the customer on the same technology. For that, you need a ubiquitous 4G layer across the country, which is what we are trying to build right now. Once you have that and if you have VoLTE, then the voice runs on the same 4G layer. Otherwise, I have data running here and the moment I make a call, I slip back to 3G and then I go back to 4G,” the person cited above said.
Currently, Airtel offers VoLTE-based services only in Mumbai.
During a conference call with investors to discuss the company’s June quarter earnings, Airtel’s India and South Asia chief executive Gopal Vittal had said that with 4G attracting more users and 2G still holding up, it is 3G telecom networks that will shut down first in India. Airtel had not decided on shutting its 3G network yet, Vittal said then.
Despite the availability of high-speed 3G and 4G services, 300 million Indians are still on 2G networks, primarily to make voice calls. With low 2G tariffs and cheap devices, demand for such services is expected to remain until 4G devices come at a price point that can match 2G handsets. This has started to happen with the launch of Jio’s 4G-enabled feature phone and Airtel’s tie-up with device maker Karbonn to sell 4G smartphones at Rs1,399 each.