Ronnie05's Blog

Indian Telecom Story (Part XXXV): Of 1 billion connected Mobiles, Burgeoning Dual SIMs and Distribution viabilities

Posted in Industry updates by Manas Ganguly on September 26, 2010

About an year or more back,I had written about a billion Indians connected through Telecom networks. That was a report by Gartner then.A recent report by iSuppli supports the year old theory of a billion subscriptions. Wireless subscriptions in 2014 expected to amount to more than 97% of the country’s population of 1.26 billion. Taking it further from the 652 million connections, the next 350 million mobile connections will really be scrubbing the bottom floor of the pyramid.

The age old axiom of growth from the rural markets is again coming afore. iSuppli has termed rural markets to be “significant and untapped market opportunity”. The other trend that seems to be catching on in Urban markets is that of multiple connections per person (112% mobility), which re-enforces the growth in Dual SIM handsets. Talking of Dual Sims, this has been a category that has seen a significant growth in the last 2 years. From being a “Chinese” handset identity feature, the Dual SIMs are now going mainstream. A recent report by GFK Nielsen, emphasizes the scale, growth and popularity of Dual SIM phones in India

• Dual SIM contributed to 23% of overall GSM handset sales in May.
• Dual SIM Market grown by 45% in 1St half of 2010.
• 2K – 3K price band Dual SIM contributes to 41% of overall dual SIM sales.
• Dual SIM market primary driven by Indian brands or Chinese brands.

• Micromax leads the market with a market share of 18.5% in terms of units share, followed by Spice 14.7%, G Five 12.8% & Maxx 11.6%

Once dismissed as a Fad which would fade away because of problems in quality and absence of strong market players, Dual SIM phones have now gone mainstream with Samsung, Nokia and Motorola beginning to consider Dual SIM handsets in their portfolio (a tad late maybe!)


Dual SIM markets in India have gone up by 45% in 6 months(December 2009- May 2010)

Dual SIM Market sizes as a %age of the Total Market in terms of Price Categories.

As discussed in an earlier post, the next 350 million will be a justifiably difficult segment in terms of viabilities versus realizations. With Call and Data rates scrapping the bottom, connectivity to rural millions will also not come at high ARPUs. In fact, that ARPU for the next 350 million will be about $1 or less. Thus the ability to collaborate and cut costs will be critical differentiators for Telcos. Towards this, Telcos would need to be open to new distribution and marketing paradigms based on collaborating with 3rd parties. Government of India under its rural empowerment program is piloting many such initiatives which offer the last mile connectivity. Similar arrangements of distribution such as Fertilizer companies or e-Choupal constructs will be important and critical for Telcos to incorporate and collaborate in terms of businesses needs.

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