Excitel to Reach Users Across 50 Cities by End of 2021
In early December 2020, Excitel revamped its broadband plans with Raina highlighting that the “response has been amazing” from its users. “Unlike the big telecom players that have their presence in Tier I cities, we want to serve the Bharat which includes the clustered Tier II and Tier III cities,” Raina said in an email interview. Raina highlights that the company aims to reach users in Tier II and Tier III cities with the “affordable” broadband plans. The revamped broadband plans unveiled by the company in December 2020, enables users to multiply their internet speeds at an “additional cost” of Rs 50 per month on annual plans. Excitel currently offers broadband plans with 100 Mbps, 200 Mbps and 300 Mbps speeds with the monthly plans priced at Rs 699, Rs 799 and Rs 899 respectively. The CEO of Excitel said that there was a “boom” in the demand for wired broadband service during the COVID-19 lockdown. “Pandemic has made people realise that wireline broadband is a basic utility like electricity, water and gas, every household that has entertainment, communication, education or work from home needs a broadband connection,” Raina said. “There was quite a big surge in demand post lockdown as well.” Further, Raina said that the demand has now “gone down” as compared to the lockdown days but the demand is “still higher than the pre COVID Days.” In late January 2021, the Telecom Regulatory Authority of India (Trai) in a report highlighted that Excitel Broadband has 460,000 users as of September 30, 2020. However, Raina said that the company witnessed a 55% growth in 2020, with Excitel achieving the 500,000 user mark “before the end of 2020.” The CEO of Excitel also said that the company has fixed the optical line termination (OLT) supply chain issues. “This situation arose mostly during the pandemic, when the country was in the state of lockdowns,” Raina said. “Most of the OLT devices are being imported from China, which lead to the delays in installation. But since the unlock-down happened and all our stocks have been refilled and the issue has been resolved.”
Excitel ARPU Between Rs 450 to Rs 500
Raina said that the “price should not be a limitation” for its users to “enjoy better technology” and that the average revenue per user (ARPU) “hovers” between Rs 450 to Rs 500. “The ballpark figure we are operating right now is Rs 500,” Raina said. “At this price we offer 100Mbps speed which is more than enough for all kinds of needs that a household of three for concurrent users would have.” Crucially, the CEO of Excitel said that the “biggest challenge” faced by the wired broadband service providers include the regulatory hurdles, lack of fibre infrastructure and right-of-way (RoW) issues. “The regulatory authority in India missed several opportunities to formulate a proactive broadband strategy that could help address the digital divide and boost the country’s economic growth,” Raina said. “The fact that less than 20% of the towers in India are backhauled compared with an average of 80% in countries like the US, China, and Korea emphasizes the need for an effective policy that gives due importance to fibre deployments.” Raina said that the “RoW charges vary from a few lakhs to Rs 1.5 crore per km across different states” in India. “With different states having different RoW policies, telcos are losing a significant amount of their infrastructure investment to municipal bodies across different states,” Raina said. In late January, the Trai released its Telecom Subscription Data as on November 30, 2020, with the data highlighting that the wired broadband subscribers hit 21.89 million. Motilal Oswal Financial Services in a report said that Reliance Jio along with “smaller regional peers” added 170,000 users each. In late November, the firm engaged in the financial services said that the broadband market “despite having huge market potential” faces challenges and “remains weak, with limited reach.” “The biggest reason for this is the capital-intensive and time-consuming nature of the business,” Motilal Oswal Financial Services said in a report in November. “Additionally, the lengthy process of acquiring approvals and permissions from the government increases the challenges faced by operators to increase their wired network reach.”
