Mobile industry dials wrong number

India to fall well short of its target of 100 mn subscribers by December 2005.

India's mobile users population is well below the projections. The Telecom Regulatory Authority of India (Trai) in March 2003 had set a target of 70 million mobile subscribers by March 2005 and 100 million by December 2005.

With just six months to go, telecom service operators say it will be a miracle if the number manages to touch 70 million "" 30 per cent short of the target.

In May 2005, the country's total mobile subscriber base (GSM, CDMA and WLL) was close to 56 million. "This is not exactly a slowdown "" we are still adding over 1.5 million subscribers a month. One must seek answers from the operators," Trai Chairman Pradip Baijal said.

The Cellular Operators' Association of India, the body representing all GSM players, had set an internal target of 80 million subscribers by the year end.

"This required an addition of 2.75 million new subscribers (both GSM and CDMA) a month. However, India has been averaging just about 1.5 million new subscribers per month. At current rates, we are likely to finish with 65-70 million subscribers by December," said COAI Director-General T V Ramachandran

The upshot is clear: Though India still continues to retain its position as the "fastest growing mobile market in the world", the mobile boom has started petering out with the urban markets reaching saturation. All operators, except BSNL, have a token presence in the rural segment.

In 2005, the average monthly growth for the country's GSM operators was about 3.5 per cent, down from 4.01 per cent in 2004.

For the CDMA players, the average monthly growth slipped to around 3 per cent from 4.21 per cent in 2004.