India’s mobile market will take its first steps toward long-overdue consolidation
The market is much too crowded, with 17 mobile licensees, leading to extreme price competition and erosion of margins. The regulator’s intention to reduce SMS interconnection and roaming charges might be the final catalyst driving consolidation. Pyramid Research has found that large and small markets alike tend toward a three-to-four nationwide operator competitive environment. We expect initial consolidation to take place between 3G and non-3G license holders or for operators to seek alliances to achieve nationwide coverage.
The 'local' handset makers will make their presence felt
The handset market has long been dominated by multinational vendors such as Nokia Corp. (NYSE: NOK) and Samsung Corp. , but the rise of the local vendors can’t be overlooked. Chinese vendors such as Huawei Technologies Co. Ltd. , ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) and Coolpad have been doing significantly better in recent years in China and India, and their low-cost smartphones will give them an extra boost in sales in 2012, both in Asia and abroad. Other vendors, for example, i-Mobile of Thailand and G’Five/ Micromax in India, are also some notable names coming out of the region, with G’Five entering the top five in India. They will continue to excel in their respective markets based on their understanding of the market, brand and low price strategy. The success in the local markets will also enable them to venture out to regions where the demand for low-cost and entry-level intelligent devices is rising.
Service providers will make cloud computing central to their growth strategies
Cloud computing has been a source of discussion for several years, but we’re now beginning to see the signs that it will become central to operators’ growth strategies in 2012, particularly in more saturated markets where growth in traditional services is waning. We see cloud computing becoming important among Hong Kong’s players, and Chinese operator China Telecom announced the introduction of its eSurf cloud computing service in 2012, giving further weight to the cloud computing trend in the region. With national broadband plans underway in Singapore, Australia, New Zealand, Malaysia, among others, cloud computing will only see its importance rise.
We will witness the beginning of the end of WiMax in Asia
Asia has long been considered an important test bed for WiMax technology, with local governments like the Taiwanese government putting political muscle behind the technology and licenses being awarded throughout the region. 2012, however, might be the year that marks the beginning of the end for WiMax. Operators in Taiwan and Malaysia are opting to use LTE instead of WiMax (or asking permission of regulators to make the switch), and the majority of BWA licensees in India, considered by WiMax proponents as an ideal market for WiMax, are opting for LTE. Waning operator support will also translate into declining vendor support and higher prices for the technology and, most importantly, the price of end-user devices, which ultimately determine a technology’s success.
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- Pyramid's Top 2012 Trends (free registration required)