Total mobile services revenue in India is projected to grow at a compound annual growth rate (CAGR) of 12.5 per cent from 2009-13 to exceed USD 30 billion, according to Analysts Gartner.
The India mobile subscriber base is set to exceed 771 million connections by 2013, growing at a CAGR of 14.3 per cent in the same period from 452 million in 2009.
This growth is poised to continue through the forecast period, and India is expected to remain the world's second largest wireless market after China in terms of mobile connections, it said in a report here.
''The Indian mobile industry has now moved out of its hyper growth mode, but it will continue to grow at double-digit rates for next three years as operators focus on rural parts of the country,'' said Madhusudan Gupta, senior research analyst at Gartner.
Growth would also be triggered by increased adoption of value-added services, which are relevant to both rural and urban markets, he added.
Mobile market penetration is projected to increase from 38.7 per cent in 2009 to 63.5 percent in 2013. Gartner said this growth is primarily attributed to the operators increasing their focus on the rural market, local consumer durable and electronic companies entering the domestic mobile handset segment, and lower handset prices.
The Indian mobile connection market continues to be dominated by prepaid subscribers. Prepaid connections accounted for more than 93 per cent of all mobile connections in 2008 and it is expected to grow to more than 96 per cent of the connection base by 2013, surpassing 741 million versus 312 million in 2008.
The postpaid subscriber base will exceed 29 million subscribers by 2013, grow at 2.5 per cent from 23 million in 2008.
The churn rate in India is 53.2 per cent in 2009, and despite a maturing market, the ratio is expected to increase to 59.6 percent in 2013.
Gartner said the revenue from data services will significantly contribute to the overall growth of mobile services in India , with a CAGR of 16.8 per cent from 2009 to 2013. Prepaid subscribers are expected to adopt data services faster than the post-paid segment. The bulk of revenue will continue to come from voice services. However, with the increased growth in data services, the percentage of revenue coming from voice will reduce from 89 per cent in 2008 to 86 per cent in 2013.
Gartner predicts a significant drop in average revenue per user (ARPU) as the bulk of new subscribers will come from rural areas, that are dominated by prepaid subscribers.
Also, voice tariffs will decline substantially in 2009 as new operators join the market. Growth will be triggered by increased adoption of value-added services, which are relevant to both rural and urban markets.
However, the bulk of new connections will come from data cards and multi-SIM use. Voice usage will increase steadily, but data usage will grow more strongly with the increased consumption of value-added services.
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