Question : Market Share of BSNL and MTNL

(a) the details of increase in number of mobile users in the country during each of the last three years and the current year State/UT-wise including Uttar Pradesh and telecom company-wise;

(b) whether Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL) have been incurring losses and in comparison to Private Telecom operators, their share in market is quite less during the said period and if so, the details thereof and the reasons therefor;

(c) the market share of the telecom companies including BSNL and MTNL during the said period State/UT-wise;

(d) the measures taken by the Government to promote competition among BSNL, MTNL and these private telecom operators;

(e) whether the entry of a private sector telecom company in the telecom sector has accentuated the possibility of more losses to BSNL and MTNL and if so, the details thereof, State/UT-wise; and

(f) whether the Government proposes to further strengthen the network of public sector telecom companies across the country and if so, the details thereof and if not, the reasons therefor?

THE MINISTER OF STATE (IC) OF THE MINISTRY OF COMMUNICATIONS &
MINISTER OF STATE IN THE MINISTRY OF RAILWAYS
(SHRI MANOJ SINHA)

(a) The service Area wise and the company-wise details of increase in number of mobile telephone connections in the country during each of the last three years and the current year are given at Annexure - I and II respectively.

(b) The details of losses incurred by Mahanagar Telephone Nigam Limited (MTNL) and Bharat Sanchar Nigam Limited (BSNL) during the last three years are as under:
(Rs. in crore)
<pre>
Financial year MTNL BSNL
2015-16 2006 4859
2016-17 2971 4786
2017-18 2971 4785*
</pre>
* financial figures of BSNL for 2017-18 are provisional and unaudited




Major reasons for losses to BSNL and MTNL are as follows:

• One time upfront cost of spectrum for 3G and BWA (Broadband Wireless Access) required to be paid in 2010 for the amount of Rs.11097.97 crores by MTNL and Rs 18500.38 crores by BSNL which has eroded their reserves. MTNL had to take loan to meet this expenditure. This has created financial stress on both PSUs.
• Both the Public Sector Undertakings (PSUs) are also burdened with salary payments of the legacy DOT (Department of Telecommunications) employees, who are now working as absorbed employees in these PSUs.
• The market dynamics have changed in last 5 to 6 years in telecom sector because of the entry of more number of operators, which have garnered major market share and put a lot of pressure on the revenues of these PSUs.
• Both the PSUs could not invest timely in upgradation of their infrastructure.
• BSNL is providing telecom services in non-profitable areas like remote and hilly regions in various states e.g. Himachal Pradesh, Uttarakhand, Jammu & Kashmir, North East, Chhattisgarh, Andaman & Nicobar Islands and Lakshdweep Islands.
• Both the PSUs have to follow the prescribed guidelines and procedures which sometimes leads to inherent delays in taking decisions.
• MTNL is providing its services only in Delhi and Mumbai Service Areas unlike other major Telecom Service Providers (TSPs).

(c) Service area wise market share of the telecom companies including BSNL and MTNL during the last three years and the current year are placed at Annexure III to VI.

(d) to (f) It is a fact that entry of a new operator in the market has resulted in intense competition among all operators, with the existing operators also offering voice and data service at competitive rates. The resultant fall in tariff has an impact on the revenue of some of the telecom operators including BSNL and MTNL. However, both the PSUs are taking all steps to remain competitive. The details of measures taken by the PSUs for strengthening network and benefiting consumers are given at Annexure-VII.