In 2015, Sivakumar Kuppusamy had a plan. Zurich-based entrepreneur Kuppusamy and his team would take on a crumbling telecom industry and become the first to sell to the 500 million Indians who were yet to come online. To do this, he set up India’s first ever consumer-facing mobile virtual network operator (MVNO) called Aerovoyce.
The idea was simple—get Indian telecom regulator Trai’s (Telecom Regulatory Authority of India) attention. To this end, Kuppusamy set up Adpay Mobile Payment India Pvt. Ltd in Chennai, a mobile payments company and the parent company of Aerovoyce. He knew that Trai was reconsidering MVNO licensing in India after its failed effort to push the communications service in 2008. And as Kuppusamy had hoped, Trai’s renewed efforts in 2016 paid off, and India was open to consumer-facing MVNO businesses for the first time ever.
Aerovoyce, in April 2017, managed to launch its first fibre broadband service through a tie-up with BSNL. It also launched voice and data services under its own brand name in December 2017, with rates starting as low as Rs 79 ($1.1) per month for 1GB daily data, coupled with unlimited calls.
Today, Aerovoyce is live in the Tamil Nadu circle. But things seem bleak. MVNO has no takers. Consumers want none of it. Aerovoyce has just about managed to launch a commercial business out of Chennai. Before they can pick up, though, MVNOs are facing multiple crises. Their average revenue per user (ARPU) is falling. There’s no comprehensive regulation. Taxes are skyrocketing. Established operators are giving it the stink eye. And if all of these weren’t enough, there’s an acute shortage of high-quality spectrum.
All in all, ouch.
If this weren’t enough, as of May 2017, 61 companies with a telecom background have acquired MVNO licenses from the Department of Telecommunication (DoT). The licenses were handed out almost a year after the DoT approved the entry of MVNOs in India. More companies have applied for licenses but they’re yet to be approved.
But wait. If MVNO has tanked, beyond Kuppusamy and his team, is anyone affected? And if so, why is DoT still doling out licenses? Does India even need these right now?
Solid precedent
Kuppusamy, to his credit, was onto something. A graduate from Salem, Tamil Nadu, he found his footing in Zurich, Switzerland, working with big telecom players such as NTT Docomo, SWISSCOM, and others for 18 years. He wanted to, to use this football World Cup’s favourite catchphrase, bring it home.
