Commerce Dashboard

Go Back

Reliance Jio, Bharti Airtel, Vodafone Idea target MSMEs for future growth

IBEF:  June 10, 2021

Telecom key players in India including Vodafone Idea (Vi), Reliance Jio, Bharti Airtel are focusing on medium and small-scale enterprises (MSME) for digital services, due to by a greater number of revenue options available with the MSMEs as compared to established organisations who have fixed providers for network services.

In Annual Report of FY21, Jio highlighted MSMEs as the core of the Indian economy, which quickly adapts to emerging industry requirements.

The company stated in the report, “JioBusiness is enabling MSMEs to be more efficient by offering enterprise-grade voice and data services, devices and digital solutions.”.

Industry analysts estimate that with the strengthening of the mobile customer segment, MSME sector is expected to be the revenue generator in the post pandemic period.

Mr. Rohan Dhamija, partner and head of India and the Middle East at Analysys Mason, said, “The retail segment comprises ~ 20 million SMEs (or kirana stores). At present, they are highly fragmented and focusing on digitising their business and this is the area where telcos can focus by offering them cloud based enterprise solutions.”

There are ~ 58 million MSMEs in India, which contributes ~ 30% of India’s GDP and attributes to 40% of exports.

Key player, Airtel is also focusing on MSMEs by providing them with B2B solutions for its enterprise customers. Airtel has collaborated with National Small Industries Corporation (NSIC) to offer MSMEs with solutions like toll free calling, cloud solutions, network security, corporate mobile plan bundles, etc.

 

At present, ~ 10% of a telco's revenue is generated from the enterprise segment. Analysts estimate this share to increase to 20%-30% in the next couple of years, driven by the MSME sector.

 

As per a Mumbai-based analyst, ”At present, a mobile customer on a Rs. 200 (US$ 2.74) plan may have enough data who would not want higher tariff. However, the small business owner might opt for a higher Rs. 1,000 (US$ 13.71) plan to meet the business requirement.”

Other player, Vi's offerings to the MSME segment include-scalable connectivity, remote working, security, and customer engagement – end point security, cloud telephony, G-Suite, location tracking solutions, security and fixed line connectivity solutions.

Players from non-mobility business of telecom, such as Tata Teleservices, have restored their emphasis towards MSME. In May 2021, as per a press release, to cater to the MSME segment, Tata Sons plans to restart its telecom unit Tata Teleservices in a new avatar called the Tata Tele Business Services (TTBS).

TTBS plans to offer services including call monitoring, intelligent call routing and an option for a dashboard to examine the number of inbound and outbound calls. The service would cater to industries dealing with large number of customers such as SMEs, fintech, ecommerce, banking, insurance, manufacturing, etc.

Mr. Mahesh Uppal, director at Com First, a telecom consultancy company, said, "As we progress to an extended use of data services, the opportunities and potential of MSMEs keep of rising. MSMEs would require more data service as they plan to increase operations. And telcos are focusing on tapping this opportunity.”

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.