We recently analysed the balance sheets of Airtel and Idea. The outcome was not surprising. One of the biggest chunks of operating costs is spelled “Power & Fuel”.
Mobile operators around the globe are faced with the problem of reducing ARPU because of fierce competition. The biggest challenge for operators is to rapidly enhance their existing infrastructure while remaining profitable.
One way to improve profitability is to reduce the costs of operations of the network. On analysis of the balance sheets of Airtel and Idea, we found that “Power and Fuel” forms the biggest chunk in the network operating costs.
Refer to the charts below for details of the distribution of network operating costs for Airtel and Idea (FY 2006 – 07).
Added to the actual cost of grid power and fuel for generators, the environmental impact of today’s mobile networks is enormous. Most of the electricity doesn’t come from renewable energy sources like wind or water.
In India alone, 2 billion litres of diesel fuel are burned annually just to power the diesel generators needed to keep Base Stations running.