Indian Telecom Net Subscriber Growth Slow Down
The relentless growth rate of Indian telecom subscriber addition finally seems to be tapering off. After 12 quarters of double digit sub adds, most of it in the range of 15 million and above, net subscriber adds have hit a 6.67 million figure in July 2011, which is equivalent to the May 2007 level. The GSM net sub adds have tumbled from a 17.16 mln in November 2010 to 5.34 mln (excluding Tata and reliance numbers) in August 2011. That is a drop of 2/3rds in 10 months. This would be putting serious pressure on the revenues and earnings of Telcos.While they have started increasing tariffs to shore up profits, slowdown in new users may yet affect their revenues going forward. The total GSM users base to 611.75 million at the end of August 2011 and the total mobility figure topped 858 million even as tele-population stands close to 900 million at 892.55 mln. In an earlier report Informa Telecoms and Media had predicted the number of active mobile subscriptions in India to rise to 1.159 billion by the end of 2012 making it the largest mobile marketin the world eclipsing China. The Indian telecom market already has a higher subscription penetration rate (75%) compared to China(69%). However, from a revenue perspective, the Indian and Chinese markets paint a very different picture. Informa Telecoms & Media projects that by the end of 2013, the Chinese mobile market will be worth approximately US$107.5 billion, as compared to India’s mobile market, which is set to be worth approximately US$35.5 billion. China’s mobile data market by the end of 2014 will be worth more than the entire Indian mobile market. The intense competition dominating India’s mobile market has made its impact on mobile ARPU, which is on average nationwide now US$3, as compared to China where mobile ARPU is just over US$10. Informa projects that India’s mobile data market will be worth approximately US$9 billion in 2014, up from US$2.3 billion in 2008 as subscribers in urban areas increasingly use their handsets to access multimedia services, and utility type services such as mobile payments and banking become more widespread in rural areas and smaller towns.
Key strategic initiatives by Telcos in India now revolves around data services – the operator views non-voice services as being intrinsic to its growth strategy as its customer base continues to grow and as it seeks to offset the ongoing fall in voice revenues. The rising popularity of messaging services, future availability of 3G/DO services and strong growth of mobile Internet and broadband will boost mobile data revenues in India during the next five years.
Out of the total 858.37 Million subscribers, 601.73 Million subscribers were active subscribers on the date of Peak VLR for the month of July 2011. The proportion of VLR subscribers is approximately 70.65% of the total wireless subscriber base reported by Telcos. Ever since the introduction of MNP, roughly 2% (15.54 mln subs) of the mobile population have opted out of their older service providers to join others.
Data: Informa, COAI, TRAI