Bharat Sanchar Nigam Limited (BSNL)’s growth doesn’t seem to be on the right trajectory. If you are someone aware of what has happened in the Indian telecom industry in the last decade, you know about the downfall of BSNL. From being one of the most prominent telecom players in the country, BSNL has been reduced to a negligent operator whose existence doesn’t serve many fruitfully. Yes, an argument can be made about how BSNL is a positive presence for people living in rural areas where private telcos don’t want to go. Regardless, in core business language, it is running on losses and will continue to do so as long as it can’t upgrade to 4G and give consumers what they want. BSNL’s 4G launch has reportedly been delayed again to next year due to issues with the procurement of homegrown 4G equipment and technology. Delays are killing BSNL’s opportunity to make an impact with 4G. Consumers will soon start shifting to 5G; at least, those who can pay more will. While 4G would be a relevant connectivity medium for years to come, most of the users on 4G would be low-paying customers. This would hurt BSNL’s opportunity of making big revenues. Achieving scale is not an issue in the Indian market. The issue is getting a return on investment out of the low-paying customers at scale. That’s what the private telcos are trying to change by increasing the tariffs and positively pushing the average revenue per user (ARPU) figure. Things would only worsen for the state-run telco from here. The consumption pattern for consumers is definitely going to change with newer technologies and faster networks coming into play. BSNL can’t play catch up all the time with the help of relief packages.
Is the Indian Government at Fault in BSNL’s Failure to Launching 4G Sooner
It is partly the fault of the Indian government as well, which has enforced BSNL to stick with the homegrown technology. Maybe it wasn’t the best decision to go with homegrown technology when things were already delayed to a painful extent. BSNL could have switched to 5G with homegrown technology. The more delays there are in launching 4G by BSNL, the more the telco’s growth would be hindered.
