A Kotak Equities analysis shows around 60% of active mobile subscribers are connected with the top three players, indicating the quality of subscribers. The average revenue per minute per month per subscriber is two times that of the rest of the pack. More surprisingly, the combined Ebitda of the 12 players in FY12 was negative despite over three years of operation. The only segment where the rest of the pack has a higher contribution than the top-3 is in non-voice revenues, which is due to the internet dongle business of RCom, Tata Teleservices Ltd and Sistema.
Duplication of networks, more focus on urban and suburban markets, inefficient asset turn and the aggressive bidding in 3G and BWA auctions have affected the revenue metrics of the rest of the pack. So, the poor economics and debt-laden balance sheet may see some of them get out of the business by selling out.