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Ericsson Mobility Report: February 2013 (Summary)

Posted in Mobile Data & Traffic by Manas Ganguly on February 20, 2013

Total number of net adds for Q4, 2012 accounted 140 million.

Ericsson- Mobile subs by region Q4, 2012

In terms of new subs/net adds, China leads the fray with 30 mln subs, followed by India (11 mln), Bangladesh (9mln), Indonesia (8 mln) and Nigeria (5mln).

Mobile subs have grown around 9% y-o-y and 2% q-o-q

Mobility Penetration Q4, 2012

In Q4, mobile broadband subscriptions1 grew ~125 million to 1.5 billion, reflecting a 50% year-on-year increase.

There is continued strong momentum for smartphone uptake in all regions. Approximately 40 percent of all mobile phones sold during 2012 were smartphones, compared to around 30 percent for the full year 2011. Only around 15-20 percent of the worldwide installed base of mobile phone subscriptions uses smartphones, which means that there is considerable room for
further uptake.

data Traffic World Wide

By the end of Q4, 2012, Global mobile penetration reached 89% totalling 6.3bln connections- However, actual number of subs is around 4.4 bln, since many users have multiple connections

GSM/GPRS/EDGE subscriptions grew ~44 million and WCDMA/HSPA grew ~70 million. Together these technologies represent ~80 percent of total net additions. LTE subscriptions grew from 14 million to 57 million. GSM/GPRS/EDGE + WCDMA/HSPA + LTE accounted for 90% of the global mobile net adds.

World wide data traffic continues a healthy uptrend and shows significant and stable growth. Data traffic has doubled Q-o-Q Q4, 2012 versus Q4, 2011 with a 28% quarterly growth between Q3, 2012 and Q4, 2012.There are variations in data consumption patterns across geographies and maturity of markets.

ericsson-mobility-report-infographic

Source of data and Infographic: Ericsson Mobility

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Indian Telecom Story (Part XXI): Over Capacity and Shake-out ahead!

Posted in Industry updates by Manas Ganguly on December 13, 2009

September 2009-The Indian telecom sector touched the 500 million subscriber base mark. Close on heels of that achievement, the DoT (Department of Telecom) reported on 12th December that average urban teledensity in India has now crossed the 100 per cent mark as per latest figures released by the department of telecom (DoT).

Urban India accounts for close to 70 per cent of India’s 500 million cellular users and over 75 per cent of the telecom operators’ revenues. The larger implication is that the country’s beleaguered mobile operators, whose revenues and profits had dipped over the last two quarters due to the savage tariff war, will now have to increase their spending as they seek to sustain the current growth rates from rural India. Even as urban India enjoys telecom penetration along the lines of developed nations, the teledensity in rural areas is only at 18 per cent, DoT data reported. 100 per cent urban tele-density is not in terms of real customers, but it reflects multiple SIM ownership. If multiple SIMs were discarded, urban teledensity would be at 80 per cent, as per operators’ internal data.

The DoT reported Himachal Pradesh to be enjoying the highest urban teledensity at 219 per cent, followed by Kerala at 156 per cent, Delhi (154 per cent), Chennai (143 per cent), Mumabi (125 per cent), Andhra Pradesh (121 per cent), Karnataka (116 per cent), while Rajasthan and Punjab have a little over 104 per cent each. Average urban penetration could go up 140 per cent within the next two years as over a fifth of residents in these zones were in the lower income bracket where mobile phones continued to remain an aspirational product. The DoT data also reveals that in nine states, the urban teledensity is less than the 100 per cent. For instance, Madhya Pradesh and Maharashtra has only about 76 per cent teledensity, the lowest for urban India, followed by North East and Assam (77 per cent).

The intense price war in the telecom space over the past couple of months, which has plunged tariffs to an all time low and is eating into the operating margins of Telcos — of even half paise per second — has resulted in a record growth of 15 million plus customers signing up for mobile connections every month.

With 13 telecom firms are jostling for space in the Indian market and three more companies are due to launch services by next year, there is case of over capacity. The problems of overcapacity created are mainly due to unregulated lending, new licensing norms and excess vendor financing. The sector could likely see a shakeout, which may help it regain its lost glory. Overcapacity is a characteristic of bubbles, and at the national level, overcapacity implies wasteful deployment of national resources (like spectrum) and just offers falling tariffs temporarily.” Analysts too have derated the telecom stocks post the country’s biggest tariff war that brought down call rates. And, that’s not the end. Along with new capacity, competition is expected to rise as new players with deep pockets make a line for what was till last year, one of the India’s fastest growing sectors. The same trend was witnessed in the aviation sector, which has now nose-dived from its peak in 2007. Markets tend to be merciless in working out the sector overcapacity. Greater the overcapacity, the greater the short-term pain. But, this is the market’s way of separating the efficient from the inefficient, and restoring balance. The efficient usually emerge stronger from the test and are unchallengeable

The sector’s woes began when the government handed out new licenses to players in 2007, despite not having enough spectrum. The government wanted licence payments and competition, but it has created overcapacity, which will eventually lead to consolidation. Banks too have added fuel to the fire through indiscriminate lending. Banks and vendor financing is encouraging overcapacity in the sector, despite the fact that new players’ plans look unsustainable in the long-term.If that continues to be the case, there may be some bankruptcies in the sector within two years from now. The current scenario, with 10-11 players, is unsustainable and a reflection of poor government policies, an aberration which would correct itself. Analysts view that market with 5-6 players is ideal in the Indian context.

The final word:
It may be more logical to promote investments in telecom infrastructure, encourage rural penetration, get into data services and rural broadband rather than focus on market structure and price wars.

Digital Dividend: The future in Mobile Communications

Posted in The Technology Ecosystem by Manas Ganguly on October 18, 2009

The govt of India, Telecom  Regulatory Authority of India (TRAI), Cellular operators association of India (COAI), Association of Unified Services Providers of India (AUSPI), Broadband wireless consortium of India (BWCI) and may industry apex bodies are single minded persuing three point agendas in the Indian telecom ecosystem.

1. Mobile Penetration

2. Lowering the costs associated with mobility / Allowing population to go “mobile”

3. Bundling services for the masses through mobiles.

According to studies by Telecom researchers and consultants, Thrust in rural telecom sector can increase GDP by $520 billion in next 8 years. ALso, a 10% increase in broadband penetration can deliver a 1.4% growth in GDP. Currently it is the best available opportunity of bringing 70% of Indian Population who love in far scattered rural areas to the mainstream. Thus the necesssity of a communications model which will reach out to the remotest rurak citizen at lowest capital and operational costs.

As with many other countries, Spectrum limitation and exponentially growing telecom subscribers are putting a lot of pressure on the existing spectrum (900/1800 MHz). The 2.1 and 2.5/2.6 GHz spectrum will have utilities more in 3G and higher end technologies. It is here, that a parallel innovation promises a lot of help. Traditionally TV spectrums have been very wide because of the fact that most of it is analogue. With the coming of Digital age, a large amount of spectrum will be freed up in case of switch over from analogue to digital signals. Digital compression technologies and coding systems make it possible to squeeze much more information into a radio signal than in the case of analogue technology.

Digital DividendDigital broadcasting is roughly six times more efficient than analogue, allowing more channels to be carried across fewer airwaves.The surplus spectrum not required for the Digital transmission is called the Digital Dividend.

  1. It is approximately 70% cheaper to provide mobile broadband coverage in the 698-806MHz band than at 2100MHz.

DD 2

      2.     Lower the spectrum, more the coverage per BTS, in effect reducing the number of BTSs required for an area coverage, which reduces the capex costs.

DD3

Both the reasons considered, a 700 MHz is twice the coverage of 3500 MHz at roughly 20% the cost. Indian Government willing, the Digital dividend could be the next step in connecting the masses in India and reaching out to them with information, technologies that would empower them and allow them to become “mainstream”.

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