DoCoMo doubles profit, Bharti shrinks

Nicole McCormick
29 Apr 2010

In a sign of shifting fortunes in the two markets, Japanese biggest cellco has doubled earnings while profit has fallen at its Indian counterpart.

NTT DoCoMo has announced net income of 75.4 billion yen ($799.5m) for the March quarter, up from 34.2 billion yen a year earlier.

The latest profit figure was void of 2G network amortization costs and boosted by lower handset subsidies.

It said operating costs were 7.6% lower, although sales were also down 2.5% to 1.04 trillion yen, thanks to the increased take-up of discount services.

In turn, ARPU fell 6.3% to 5.35 yen in the year to end-March.

“Competition among operators remains intense in areas such as acquisition of subscribers and further improvement of service offerings,” said DoCoMo. Full-year profit grew 4.9% to 494.8 billion yen, on 2.5% lower revenues of 1.042 trillion yen.

Meanwhile, Bharti Airtel’s results are showing the effects of the country’s robust price competition.

India’s largest mobile operator posted March quarter earnings of 22.39 billion rupee ($503m), down 8% from 20.55 billion rupee a year ago.

Revenue was up 2.3% to 100.55 billion rupee, thanks to 8.8 million mobile net additions in the quarter, but average mobile rates per minute declined 25%, and ARPU fell 28% year on year to 220 rupee.

“Every quarter is tough, every year has been tough,” Akhil Gupta, deputy CEO of parent company Bharti Enterprises toldBusiness Standard.

“But, very clearly, last year, in terms of the intensity and irrationality, has perhaps been the toughest.”

Gupta reportedly believes that India’s debilitating tariff war is now over.

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