The year 2019 was perhaps the most chaotic time for the telecom industry in India. A sector that once boasted a dozen players had been hit with a brutal price war, leaving the giants of yesterday bleeding. At the centre of the storm was Bharti Airtel.
By early 2020, the company that used to be the market leader reached its bottom, posting a staggering net loss of ₹32,183 crore for FY20. To appreciate the depth of that crater, one needs to look back to FY16—the year before Reliance Jio entered the fray—when Airtel enjoyed a profit of ₹6,893 crore. The industry’s average revenue per user (ARPU), a key telecom metric, had collapsed from ₹126 to a measly ₹74.3.
It was against this backdrop that promoter Sunil Bharti Mittal came to then-CEO Gopal Vittal with an offer: Let me focus on raising the money. You focus on the company.
That division of responsibility helped Vittal plan the next moves that would set the company on a new course. “Reliance came in with the announcement of a capital investment which was more than what Airtel had invested over its entire existence of 20 years,” Vittal recalls. “They had infinite reserves of capital. The question for us was: How were we going to play differently?”
Vittal’s answer was a radical clean-up act that flew in the face of traditional telecom wisdom.
For decades, Airtel had been celebrated as a “minutes factory”—a high-volume game where every customer, even those paying just a few rupees, was a win. “But that doesn’t work when you’re playing against a player which has larger reserves and larger capital,” says Vittal.
So, he pivoted. Overnight, Airtel shed 40 million customers.
Those users, Vittal says, were largely low-spending subscribers who clogged networks, stressed call centres and contributed little revenue.
“India is a market where about 40 percent of customers account for 70 to 80 percent of revenues,” Vittal says. “And about 250 districts out of roughly 770 account for almost 70 percent of industry revenue.”
Instead of spreading capital thin, Airtel concentrated its resources in those districts and among those customers.
The company doubled down on network quality for high-value users. It also made another counterintuitive decision: Charging more.
Taking a premium on price required something else—building an aspirational brand. Airtel redesigned how it appeared everywhere: Stores, marketing, customer service and partnerships. Content deals with companies like Amazon, Netflix and Apple reinforced that premium image. A heavier push into postpaid customers helped lock in higher-spending users.
Free or ultra-cheap data pushed millions toward smartphones, leading to an explosion in data consumption. A lot of businesses—from food delivery and ride-sharing to digital payments—began building on top of those 4G networks. But the economics was punishing for telecom companies as all of this did not translate into higher revenue.
That forced operators to borrow heavily. Yet, Vittal saw a structural logic emerging from the chaos.
Before the disruption, India’s telecom sector had 10 players. But the distribution of spectrum was lopsided. “The top three players had 75 percent market share, but only 25 percent of the spectrum,” Vittal says. The rest sat fragmented among smaller operators.
The industry, he believed, was destined to consolidate. “You needed perhaps three (private) players.” That is what India has today: Reliance Jio, Bharti Airtel and Voda-Idea (Vi).
The crisis forced another internal reset at Airtel.
Traditionally, Airtel judged its operating units on three metrics: Revenue, margin and market share. But when industry revenue collapses, two of those metrics—revenue and margin—inevitably turn red.
“Which means every day, people feel like losers,” Vittal says.
In response, he shifted the internal scoreboard. With revenues unpredictable and margins under siege, Vittal told his team to ignore the noise and focus on two things they could control: Frugality and market share.
The results? Airtel’s market share has climbed from about 30 percent in 2016—a lifetime high then—to roughly 41.5 percent today.
One of Airtel’s most controversial bets was its decision to skip the expensive 700 MHz spectrum band and the “standalone” 5G mode favoured by its rivals in the 2022 auction.
To many in the industry, the decision looked like a gamble, with questions on whether the company risked falling behind rivals if it skipped the low-band spectrum that offered wide coverage.
Inside Airtel, the calculation was different. Low-band spectrum such as 700 MHz travels farther, improving coverage, but offers relatively limited capacity for carrying large volumes of data. Mid-band spectrum—where Airtel concentrated its holdings—provides far greater capacity, the kind required for the explosion of data traffic on smartphones. Vittal says: “Ultimately, the question is: What is the experience the customer gets?”
By avoiding the 700 MHz band, Airtel sidestepped tens of thousands of crores in additional spectrum costs and the need to deploy thousands of power-hungry radios that would have raised operating expenses. The company instead doubled down on strengthening its mid-band spectrum holdings and improving network performance where most data traffic flows.
The move reinforced a principle that, Vittal says, has guided many of his decisions. “You respect your competitors. But you obsess over your customers.”
Another example is Airtel’s AI-driven spam detection network, which flags suspicious calls and blocks fraudulent links in real time. According to the home ministry, fraud on the Airtel network has dropped by about 70 percent after the system’s deployment.
Vittal’s philosophy around AI is that it should either get you more revenue or reduce cost.
The second layer is the “work plan”, a horizontal digital stack that manages how the company buys, builds, pays and serves. Each of the 80,000 field associates is on this platform. When a technician fixes a broadband connection, an AI model at the back-end watches the video of the repair to authenticate the job quality instantly.
Finally, there is the channels layer, which ensures that whether a customer walks into a physical store or opens the app, the experience is identical and seamless. This entire stack was built using open-source software, keeping Airtel’s IT costs at a fraction of the global industry average.
“Our IT cost as a percentage of revenue is only 1.6 percent. For telcos around the world, it varies between 5 percent and 12 percent,” says Vittal.
AI is the silent engine that drives growth in this for the telecom company. “AI is at the heart of everything we do,” emphasises Vittal.
To be sure, ARPU is rising across the industry on the back of increasing internet adoption and data consumption by rural subscribers. “The industry ARPU is expected to rise by ₹20-25 to reach ₹225-230 by the end of this fiscal, assuming tariffs remain stable. Around 55 to 60 percent of the incremental ARPU is expected to come from rural subscribers,” says Anand Kulkarni, director, Crisil Ratings, in a note.
Airtel, however, leads in ARPU. In the third quarter of FY26, Airtel reported ARPU of ₹259 compared to ₹213 for Jio and ₹186 for Vi.
During an investor call on February 26, Mittal raised the ARPU expectations to ₹350. “I remain hopeful that we will get to ₹300, but adjusting for inflation. We have a new slogan to say an ARPU of ₹350 would be the most appropriate ARPU in today’s time frame,” said the founder and chairman of Bharti Enterprises.
“The first port of call (for capital allocation) is the core telecom business,” Vittal says. “If you’re not doing well there, you have no right to do anything else.”
“Growth is also not a concern—wireless growth will be supported primarily by ARPU expansion.”
Airtel has been expanding into adjacent industries that leverage its data. In lending, Airtel has facilitated ₹6,000 crore in loans by using its data to identify creditworthy customers and using digital tools to keep collection costs low.
On February 13, Airtel Money got a licence to operate as a non-banking financial company. The new subsidiary will be funded with an investment of ₹20,000 crore to be infused over the years. Airtel will hold a 70 percent stake in the venture, while the promoter group, through Bharti Enterprises, will provide the remaining.
Another area is cloud. Airtel has been running its own cloud infrastructure for years to power internal applications. The system now holds roughly 250 petabytes of data and operates more than 10,500 servers. It has begun offering that infrastructure to enterprise customers through cloud regions in Delhi, Mumbai and Chennai.
The data centre business is perhaps the most ambitious “new” bet. Airtel currently holds about a 10 percent market share in the space, but with a massive build-out across Mumbai, Chennai and Hyderabad, it is aiming for 1 GW of capacity and a 25 percent market share.
Airtel also has interests in cybersecurity. On February 20, it launched a cyber threat research centre in a partnership with leading cloud security provider Zscaler.Bharti has built a strong professional management team, which has allowed it to execute projects effectively, says Axis Capital’s Malhotra, who tracks Airtel. “Its diversified operations within Airtel in India and overseas, as well as at the group level, allow it to cross-pollinate capabilities as it enters new businesses. For example, when it acquired Zain’s Africa operations in 2010, it leveraged the strength of the Indian management team.”
Vittal recalls how when Godrej Consumer Products’ Executive Chairperson Nisaba Godrej joined the board in 2021, she wanted to visit and see how the frontline work happens. She returned struck by the sense of ownership among employees interacting directly with customers, says Vittal.
This ownership culture is cultivated through daily rituals. At 9 am daily, every Airtel store team discusses what went well the day before and also the “lousy stories”—what went wrong and how to structurally fix it.
Vittal himself leads from the front, travelling two days a week to meet frontline workers. “Decision-making becomes faster when you’re connected to what’s happening on the ground,” he says.
The second thing that defines the Airtel culture is rigour, says Vittal, which means refusing to accept averages. Rather than analyse performance across a handful of regional units, Airtel divides the country into roughly a million micro-markets and measures network quality in each one. Even its infrastructure is scrutinised at granular levels. The company tracks the profitability of every single tower across its network of roughly 3,40,000 towers.
During the recent round of succession in 2025, when he handed the CEO reins to Shashwat Sharma and took on the role of executive vice chairman, there was no disruption. “That shows Airtel is an institution,” Vittal says.
For him, the hallmark of 2025 wasn’t just the healthy financials (with a net debt-to-Ebitda ratio of less than 1.5 against the 2.5 that’s considered a respectable figure for the sector globally), but also the confidence to step into cloud and lending.
In his new role providing group-wide oversight, Vittal is ensuring a clean division of labour. Just as Mittal once backed him, Vittal is now allowing the new CEO to focus on the core Indian telecom market while he focuses on the allied “future” businesses.
“For the India business, I’ve said: You focus on the core and let me work directly with some of the leaders of these (new) businesses, whether it’s cloud or data centres or lending.”
The leadership may have changed. The strategy hasn’t.
First Published: Mar 31, 2026, 14:54
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