Wednesday, 28 October 2015 21:35

Mobile subscribers in India close to 1 billion, and growing fast


Mobile subscribers in India now number almost 1 billion with mobile penetration in the country now predicted to reach 100% in the next five years.

A report from telecommunications analyst firm, BuddeComm, says India’s mobile subscribers werealready at 970 million in March this year, with growth running at steady 7% a year, and representing a current mobile penetration of 77%.

The report author, BuddeComm Senior Analyst Asia, Peter Evans, says that after a major hiccup in 2012, India’s mobile market has sorted itself out by this year and he’s predicting the country’s mobile penetration will likely reach 100% by 2020.

According to Evans, the overall economic impact of mobile technology in India amounted to approximately US$115 billion in value-added terms in 2014, representing an economic contribution of around 5.5% of the country’s GDP for the year.

Looking forward, Evans says mobile broadband was set to grow exponentially throughout India, driving digital inclusion and economic growth for India’s consumers and businesses.

“Into 2015 4G and other data services were shaping as a key battleground. The entry of a new operator Reliance Jio into the market was expected to see even more intense competition in an already hotly competitive market.”

Key highlights of the report show that by mid this year (2015) there was already considerable progress in the roll-out of 4G services in India:

•    Bharti Airtel was operating a TD-LTE network

•    Bharti had also launched a trial FDD LTE network in 20 cities

•    Aircel had launched 4G services

•    Vodafone was planning to launch 4G in Calcutta, Mumbai and Delhi by December 2015

•    Reliance Jio was set to introduce its 4G network by the end of 2015

•    Idea Cellular was reported to be set to launch LTE services in January 2016

•    BSNL was preparing to launch 4G by March 2016.

On the regulatory front, Evans says there were positive signs of a market improving on the back of restructuring, and figures from the TRAI showed that Mobile Number Portability (MNP) was working well.

“The process of auctioning spectrum was also working well – despite criticism that the reserve prices had been set to high. The removal of the cap on foreign investment in the telecom sector was yet another strong signal to the market of the government’s intentions.

“The telecom market was still waiting on regulatory guidance with respect to mergers and acquisitions, however; this was important for the process of market consolidation to continue,” Evans writes.

Evans also says that the fixed-line market in India, which had grown strongly over a number of years, began experiencing zero and then negative growth in 2014, with fixed-line subscriber numbers standing at around 26 million by early this year.

With less than 3% fixed-line penetration, India had nevertheless achieved a “remarkable national coverage”, with 99% of the population having some form of access to a telephone, Evans said.

“The heavy investment in telecoms infrastructure over the last decade or so, plus a number of key regulatory initiatives that have combined to see India’s huge population delivered at least some level of telephone service.”

In terms of the internet and online access, Evans says there have been a number of efforts by the government to promote broadband internet throughout the country; broadband development had long been languishing, but there was new hope for a serious expansion phase in this segment of the market.

He reports that by early 2015 there were around 15.5 million fixed broadband subscribers in India, describing it as “a lowly penetration (by population) of slightly more than 1%.”

“Meanwhile, mobile broadband was finally having an impact on the market and in the medium term this was expected to lift broadband penetration significantly. By March 2015 there were already more than five mobile broadband subscribers for every fixed broadband subscriber.”

Evans observes that, although still facing serious functional and regulatory challenges, there is much that is positive to be found in India’s telecom industry.

He says sweeping reforms introduced by successive governments over the last decade or so have dramatically changed the nature of telecommunications in the country.

“A number of factors have been responsible for the amazing growth in India’s telecom sector; apart from the obvious booming economy and the rapid expansion in the country’s middle class, the growth drivers include low tariffs, low handset prices and most notably a highly competitive market created by the government and the regulators,” Evans concludes.


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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).



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