Big Interview: BSNL’s here to compete

Indian telecom services market is not for the faint-hearted. Only the fit can survive and operate. Many have perished, sold off their assets and some have even landed at insolvency courts. As the bloodbath continues over profitability and subscriber acquisition, the sector consolidates to three private and one PSU operator (BSNL).
Amid all pressure points, thePSU  stands up to the challenges thrown by Reliance Jio and the like. The hurdles are not limited to just external competition. Itis more acute internally as well. The challenge of a huge and aging two lakh workforce, absence of lucrative circles of Delhi and Mumbai, lack of spectrum, grand social commitments without any return, only make the situation go from bad to worse.
But these factors don’t deter the ever-optimistic CMD of BSNL to plan for a pan India 4G roll out and sign agreements for 5G services. From a severely loss-making era to an EBIDTA- positive phase, the PSU has been able to stand tall because of the leadership and continuous efforts. A little over three years into the role, he has made the PSU a  market, service and customer-oriented organisation. The soft-spoken CMD can be credited for being a tough taskmaster in transforming the lethargic attitude of the employees with a ‘service with a smile’ approach and introducing a corporate culture. BSNL will compete, says Anupam Shrivastava, CMD, BSNL during a conversation with Anjana Das
Do you think 2019 fiscal will be the year when telcos will start returning to profit? Or the hangover of Jio’s free and cheap offers will still haunt along with cut in IUC rates, making the industry sinking further in losses?
The fiscal year will be interesting for all telcos, including BSNL. With consolidation taking place, there will be a scenario of 3 private+ 1 (BSNL) PSU operator. This should stabilise the tariff, therefore further downslide in topline revenue would not be there. However, to return to the revenue figure of September 2016 quarter in wireless segment, I feel it should take 5 to 6 quarters more.
How do you read TRAI’s new criteria and definition of Significant Market Power (SMP) under Predatory Tariff order, which evoked strong reactions from top three incumbents and now has been stayed by TDSAT till further hearing?
BSNL feels in order to determine Significant Market Player (SMP), wireless voice and data services may be taken as one product and wireline voice and broadband services as another. Relevant factors for assessing SMP should be same as given in section 19 (4) of Competition Act 2002. In addition, for wireless voice and data service, spectrum in one particular band and total cumulative holding of the spectrum in LSA should be taken into account. To access predatory pricing, TRAI may adopt similar process of CCI.
BSNL has just started 4G services. When can we expect 4G VoLTE services from it? And for that does the PSU need to tie up with compliant handset manufacturers?
We are expecting 4G VoLTE services to start by middle of this year. BSNL has started dialogue with handset manufacturers to make them compliant for the same. We have taken a conscious decision of procuring only 4G SIMs henceforth.
BSNL has withstood competition well in the last one and half years. Is the net profit dream still elusive or round the corner?
BSNL has been matching tariff by tariff, plan by plan in all the segments. BSNL had a turnaround in FY 2014-15 and in FY 2015-16. In FY 2016-17, it continued to remain EBITA positive. However, with disruptive practices in the industry, there was erosion of topline in the last fiscal year. It may take one or two financial years for BSNL to become profitable.
What drop in data and voice prices do you expect this fiscal from the current tariff level of Rs 21 per 1GB data?
There has been a paradigm shift in usage tariffs, which is becoming more and more data centric. It is expected that an average smartphone user will be using up to 11GB data/month by 2022. Therefore, as data usage volume keep on increasing, the price will come down.
You have brought BSNL to a strong position today than it was three years ago. What challenges are you facing now?
There are many challenges to lead a big PSU with legacy of being a government department, which has to not only face stiff competition from outside but also has to address many issues from within. The landline segment is a big pain point, despite BSNL having the biggest market share. With the tariff war in mobile segment and high expectations in enterprise business, it’s really a challenge for BSNL. Also with such a large workforce and average age of its employees between 53-54 years, keeping them motivated is also difficult.
BSNL is acquiring subscribers at par with private operators due to agility of the company and your tariffs. How will you continue with this?
BSNL has not only withstood the pressure but has consolidated its position in last 3 years. The market share has increased from 7.96 per cent on March 2015 to 9.4 per cent on January 2018 in wireless segment. As BSNL is not in Delhi and Mumbai and if we exclude it then corresponding increase in market share has grown from 8.65 per cent as on March 2015 to 10.2 per cent on January 2018. In March 2018, we provided 4 million gross connections. We have been MNP positive since last 3 financial years with more than 7 lakh net positive each year in 2016-17 and 2017-18.
The PSU under your stewardship is well placed for the new order in the telecom space. How is the emerging situation of three private and one PSU combine operators can be beneficial BSNL?
3+1 scenario should stabilise the tariff. BSNL has already invested in expanding its 4G network so the main strategy would be to keep on increasing the market share. This would help BSNL to increase its topline.
Are we looking at a situation where BSNL becomes one of the top three players?
With large volume of additions in mobile connections day by day, BSNL definitely aspires to be amongst top three players.
You enjoy support of the telecom ministry as a PSU and also as the CMD. You are very popular among your over 2 lakh employees. Do all these adulations help in taking the PSU forward or does it put an extra pressure?
CMD is the face of the organisation for the administrative ministry, its employees and also for its entire customer base. Popularity per se has both the dimensions, as it makes your work somewhat easier but at the same time, it gives the additional responsibility of ensuring that the expectations of all the stakeholders are met. I hope that all concerned should be satisfied with the performance in the last  three years.
Your market share is improving in wireless, may be fixed line needs some similar boost from the management where you are still a leader.
BSNL is putting equal efforts in ensuring the growth of wireless business, wireline business as well as in enterprise business segment. On one hand, we are upgrading the technology and backhaul and on the other hand we are putting efforts in improving quality of service delivery. In the present era of super competition, sales and marketing efforts deserve a special focus attention by any telecom operator.
The government recently announced synergy between the 8 telecom PSUs. What are the benefits you are looking at?
This is definitely a great initiative with many benefits like of cost optimisation by sharing of training infrastructure, land and building etc. Also, Government of India’s dream project ‘Smart Cities” can be implemented well, if all work in a consortium.
Five years from the current fiscal does it have possibility of upgrading itself to a Navratna company from the current Miniratna? When should your main shareholder start getting dividend from the PSU?
BSNL is shouldering the responsibility of government projects as they are not only crucial but sensitive in nature and also time bound. We hope that BSNL should be in a position to declare dividend in the shortest possible time in future.
Describe your three key practicing policies, which have helped you to revive BSNL?

To revive a loss making PSU, you have to take along everyone - the employees, unions, management, the board and even the customers. Regular monitoring, timely decisions, freedom to bring and implement new ideas are few of our management practices, which helped in bringing back the past glory of the PSU to some extent.