x
3G/HSPA

Indian Mobile Revenues to Hit $37B

Indian mobile operators can expect to see continued robust growth in services revenues over the next few years, becoming a $37 billion market by 2012, according to new stats from Gartner Inc.

The research firm forecasts the Indian mobile industry’s total revenues will increase at a compound annual growth rate (CAGR) of 18 percent as the subscriber base reaches 737 million.

That would be an addition of 464 million subscribers over the next four years from the 272.71 million reported by operators for the end of May. (See India Adds 8.6M Mobile Subs in May.) The Indian government has set a goal of reaching 500 million subscribers by 2010.

Gartner notes the bulk of India’s telecom growth will come from rural markets, which operators are increasingly targeting since that’s where around 70 percent of the country’s 1.1 billion-strong population resides and telecom penetration lags well behind urban areas.

With tariffs among the lowest in the world and set to fall further as new operators boost competition, rural markets are expected to deliver a fourfold increase in subscribers, helping to push overall market penetration from an average of 19.8 phones for every 100 people in 2007 to 60.7 in 2012:

Table 1: India Population and Cellular Market Penetration, 2007-2012
2007 2008 2009 2010 2011 2012
Penetration (in %) 19.8 29.7 40 47.8 54.8 60.7
Population (in Millions) 1,135.60 1,151.60 1,167.50 1,183.30 1,199.00 1,214.50
Source: Gartner




Gartner points to local consumer durable and electronics companies entering the domestic mobile handset segment and the falling price of handsets as a growth driver -- one that’s already falling into place.

For example Videocon Group, a consumer durables firm that has received licenses to launch a new mobile operator, is planning to manufacture its own branded phones and has been trying to acquire Motorola's handset division. (See India's Videocon Plans Mobile Launch and Moto Device Biz Buyer?)

The vast majority of Indian mobile subscribers (90 percent) use prepaid services, and Gartner predicts the prepaid subscriber base will cross 683 million by 2012, compared with 53 million postpaid subscribers. Data revenues from the prepaid segment are projected to rise by a CAGR of 29 percent, with subscribers adopting data services more quickly than postpaid subscribers, who are expected to bring in revenues at a 22 percent CAGR.

It follows that an increase in revenues from value-added services will nudge down the percentage of revenues coming from voice -- from 89 percent in 2007 to 85 percent in 2012.

— Nicole Willing, Reporter, Light Reading

Be the first to post a comment regarding this story.
HOME
Sign In
SEARCH
CLOSE
MORE
CLOSE