India will continue to be the fastest growing country in the Asia Pacific (APAC) region next only to China, with cellular services estimated to reach $25.61 billion by 2011. The industry would register an 18.4% growth per annum through 2007-2011. Its revenues stood at $8.95 billion in 2006.
The growth would be catalysed by Vodafone's entry, a fall in telecom tariffs, and emergence of inexpensive handsets.
The revenues from data services will outpace voice revenue growth and contribute 22% by 2011 from the 9.6% in 2006, according to a study by global research and analyst firm Gartner.
Gartner also projects cellular market penetration to increase to 38.6% by 2011 from 12.7% in 2006. The overall penetration would be driven mainly by an increased focus on the rural market, aggressive promotions by the operators, and handset bundling schemes.
By 2011, around 58% of the rural population and 95% of the urban population would be mobile.
“With more marginal users forming the bulk of the addressable market, low service costs and inexpensive handsets will help unlock the inertia and facilitate adoption of mobile services," Madhusudan Gupta, senior research analyst, Gartner said.
Call rates have reduced significantly to about 2.6 cents per minute. However, this remains high compared with fixed-line rates at 0.9 cents per minute, he said.
Gartner expects prices to drop, which will help in further lowering the entry barrier.
The mobile penetration in the rural market is at 2%, which represents an immense opportunity for the cellular service providers. Handset manufacturers are therefore concentrating on launching sub-$25 mobile handsets, the study said.
Businesses are expanding into India's smaller towns and cities where fixed-line connectivity is limited or non-existent. Enterprises will use mobile services for intra- and inter-company communications, while mobile players might offer services to corporates at charges that might not be related to distances.
The mobile growth in the Indian market is on an upward trajectory, and robust growth will continue until 2011. The market is forecast to grow 23% per annum during the five-year forecast period, to exceed 462 million connections.
The Indian market is driven by pre-paid connections, which accounted for over 84% in 2006, and are expected to grow to around 93% of the total connection base by 2011.
|
Content Guide
