Sarin looks to Indian subscriber growth

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Arun Sarin, chief executive of Vodafone, on Tuesday outlined the scale of the growth opportunity the company has in India, where he earlier this week concluded a deal to gain control of Hutchison Essar, the country’s fourth largest mobile operator.

“The deal in India is not about increasing average revenues per user (ARPU). In a few years mobile penetration in India will grow from 13 per cent to 40 per cent – that is around 550m subscribers,” Mr Sarin said, speaking at the sidelines of 3GSM World Congress in Barcelona.

“ARPU on everything will decline over the next few years but we are doing things such as sharing networks with Bharti Airtel to reduce costs,” he said, referring to a deal he recently struck with the company to share 70,000 telecoms towers.

Mr Sarin, who looked elated by his recent victory in the bidding battle for Hutchison Essar, said he was planning to build the network further into rural areas.

He also said he had plans to bring more entertainment and information services to India, as well as mobile banking and money transfer services.

He reiterated hopes that Essar, an Indian conglomerate that holds 33 per cent of Hutchison Essar, would remain a long term partner in the mobile company.

“I am very eager for Essar group to be part of the company in India. I like to have a local partner and the Essars are very welcome to stay,” he said.

“They have some choices. In two or three weeks we will make them an offer that will be identical to the one we made Hutchison, to sell their stake. But my great hope is that they stay in the company.”

Mr Sarin said the senior management of Hutchison Essar was likely to remain in place.

Mr Sarin also indicated that he was looking for further network sharing deals across the world to help reduce costs.

Many mobile operators are looking to either outsource the running of their networks or share infrastructure with rival operators to make savings. Mr Sarin said he preferred network sharing as this gave the company a “certain level of control”.

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