India has been growing step by step to become a world superpower, but the growth will be further augmented if each Indian could be connected to the world. The mobile phone has proved itself as an effective means to connect the globe, especially since now it comes packed with internet features. A study by Gartner states that the mobile connections in the country will rise to 27.3 percent this year to cross 660 million.
This rise will also increase the Mobile service revenue to attain $19.8 billion till the end of 2010, accounting for almost 19.7 percent from last year. It forecasts that the aggregate mobile services revenue would cross $23 US billion by the year 2014. Such a rise would maintain India on the second position after China, in the world’s largest wireless market league.
“The arrival of new players in the Indian mobile sector has led to fierce competition which has sustained the strong subscriber growth we saw in 2009,” commented Neha Gupta, senior research analyst at Gartner. “Furthermore, with mobile penetration standing at 44.5 percent at the end of 2009, there is still ample room for growth in 2010 and beyond.”
The Gartner study reports on the mobile penetration, which currently stands at 55.9 percent in 2010 and is anticipated to reach 72.5 percent in 2012 and 82 percent by 2014. This shall occur due to reasons like service provider shifting highly to rural markets and low priced handsets. The report further foresees the Indian mobile industry attaining double-digit rates by 2012.
“The increase in competition in the Indian mobile market has led to price wars which have in turn led to a decline in voice Average Revenue per User (ARPU), and we expect this trend to continue as service providers increasingly shift their focus to rural areas,” Gupta further added. “Expect a dramatic decline in growth of voice revenue from 2010 until the end 2014, although this will be balanced by increased revenue from data services which will significantly contribute to the overall growth of mobile services in India.”
The report goes on to state that even though the industry is portraying growth, competition has increased as well. This has resulted in many network carries reducing their prices which in turn affect the overall revenue. Research analysts contemplate that in the next 18 months there would be some consolidation taking place. They anticipate such a circumstance due to the upcoming introduction of 3G services which make network carriers branding themselves with the quality and variety of service rendered rather than the current price scenario.
The government auction of 3G and Broadband Wireless Access licenses which has just concluded made quite a few service providers empty their pockets leading to rise in the net debts on an industry level. They although anticipate higher operating cash flows from growing subscriber base and revenues to counter attack the debts.
Users may garner additional information on the report from the official Gartner website. The study is entitled ‘Forecast: Mobile Services, Worldwide, 2005-2014, 2Q10 Update’.