Small towns, rural mkt keep mobile telephony buzzing

With mobile telephony growth in the metro cities and the A-class circles reaching saturation, cellular growth over the last 12 months have been largely driven by subscriber additions in smaller towns and rural markets.

The Indian cellular market has witnessed an average growth of 3.5 per cent per month during the last year. While the growth remains impressive, a geographical break-up reveals that this rate has been propped up by category B and C circles.

According to data compiled by industry bodies and the department of telecommunications (DoT), C and B category circles have shown an average monthly growth of 6.5 per cent and 4.23 per cent, against 2.49 per cent and 3.14 per cent for the Metros and A-class circles, during the last 12 months.

Category C comprises states which have an average of 85 per cent rural population and the same account for 75 per cent in category B states.

For instance, in the month of September, B-Circle states, which include Orissa, Bihar, Assam, the Northeast and Kashmir, added close to 850,000 subscribers, compared with 3,50,000 in the Metros and 4,80,000 in A circles.

"Category C circles have outperformed the national and other category averages for percentage growth over multiple quarters, in terms of both GSM and CDMA customers. Consequently, we can contest the claim that areas with higher rural populations or lower economic status are not attractive for investment in telecommunications infrastructure," the Trai had in its latest report.

The telecom regulator has also said rural markets have sufficient purchasing power to drive up subscriber growth. This was indicated by the fact that both rural and urban areas had same number of middle to high income households, while the penetration was 25 times lower in former, Trai said.

According to the DoT data, the number of middle-to-high-income rural households in India were at 21.16 million, while it was 23.22 million in urban India. India calling

Cellular market has witnessed an average growth of 3.5% per month during the last year

C and B-category circles have shown an average monthly growth of 6.5% and 4.23%, against 2.49% and 3.14% for the metros and A-class circles, during the last 12 months

Category C comprises states, which have an average of 85% rural population and the same account for 75% in category B states