India generates 40% of Vodafone's mobile usage volume

India generates 40% of Vodafone's mobile usage volume

Indians clearly love to talk. Close to 40% of the mobile usage volume of Vodafone, the world’s largest cellular operator, is now generated by its Indian arm, Vodafone Essar.

Vodafone operates in about 30 countries globally. An analysis of the Vodafone group’s results for the quarter ended December 2007 reveals that globally, the company clocked about 115.7 billion minutes of usage, out of which India accounted for 43.3 billion minutes.

In fact, India single-handedly accounted for the group’s increase in its minutes of cellular use. Consider this: Globally, for the Vodafone group, the mobile voice usage volume rose by 10.9 billion minutes during the quarter-ended December 2007. India has contributed 86% of this increase. Put simply, cellular usage volumes increased by 9.4 billion minutes in its Indian entity alone.

This is despite the fact that Vodafone Essar operates only in 16 of the country’s 22 telecom circles. Vodafone Plc has a majority stake in Vodafone Essar. India, the world’s fastest-growing mobile market, has also delivered on all other parameters.

The country contributed 39% of the 10.8 million subscribers that Vodafone added during the quarter. In fact, India added more subscribers (4.2 million) during the last quarter than the whole of Europe combined (3.1 million). India became Vodafone’s largest market in terms of number of subscribers during the September 2007 quarter.

In revenue growth too, India tops Vodafone Group’s performance. “Year on year, total revenue growth for the quarter (ended December 07) was 56%....,” the company said, while presenting its results on Thursday.

Egypt came a distant second, registering a 31% increase in its total sales for the quarter-ended December 2007, when compared with the corresponding period in 2006. These refer to percentage increases in revenue, and not absolute numbers.

With regard to its global operations, the Vodafone Group classifies India in its EMAPA, Eastern Europe, Middle East, Africa, Asia Pacific and Affiliates, group, “India accounted for most of the increase (in EMAPA), with Vodafone Essar generating a 71% increase in customers year on year, adding 4.2 million customers in the quarter.

The total customer base (in EMAPA) reached 112.0 billion, surpassing Europe for the first time, and included 39.9 billion customers in Vodafone Essar in India, making it the largest operator by customers within the Vodafone Group,” the statement said.

Vodafone has also explicitly spelt out its plans for India, “Earlier this month, the department of telecommunications allocated spectrum to Vodafone Essar in six additional circles. The group anticipates launching operations in these circles later this calendar year, providing a national footprint and enabling it to benefit from the rapid penetration growth in rural areas,” the statement added.

For Vodafone PLC, India also offers the highest potential for expansion as its tele-density is only about 23%. This is because most other countries, where Vodafone operates currently, are reaching the saturation point. Switzerland has a tele-density of about 97% followed by Germany (80%), US (80%), France (80%), Turkey (70% plus) and Romania (70% plus).

When Vodafone acquired the majority stake in Hutch a year ago, India accounted for its third-largest customer base after Germany and the US. In September 2007, within a span of just a few months after the acquisition, India moved ahead of Germany to become the company’s largest customer base.