Indian Telecom Industry In 2011


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This report gives the analysis of Indian Telecom Sectro in 2011, considering various parameters of Mobility

Indian Telecom Industry In 2011

  1. 1. 2010 Indian Telecom Industry in 2011 BY:- Siddhant jain 9595637843
  2. 2. SCOPE The wireless industry in India has shown unparalleled growth. This paper is an effort to present an insight into the future of the highly dynamic market. It takes into account the key drivers of mobility, such as ARPU, MoU, VAS, Data Cards, future trends in wireless internet, enterprise market and Convergence. ARPU and MoU With increasing number of subscribers, operators have to maintain QoS in order to Per second billing, increasing popularity of retain customers and fight the churn which dual SIM handsets and higher penetration in is expected up to 8-10% after the launch of C circles are the major contributors to the MNP, from 5-6%. Also decreasing AMPU continuously declining APRU and MoU. It is (average margin per user) has led to estimated that the blended ARPU for GSM increased focus on the revenue assurance and CDMA is expected to decline to `98 practices. and `60 respectively, WIRELESS INTERNET Wireless subscribers capable of accessing internet via mobile will grow from 149.03 mn in Dec’09 to 187 mn in Dec‘10 .With private operators rolling out 3G soon, the number of active wireless internet subscribers is expected to grow exponentially. The main driver will be the ability to get real-time while MoU for GSM and CDMA will fall to information on the move. 320 and 260 minutes respectively by Dec 2010. Data Card The effect of declining ARPU and MoU can be directly seen in operators’ revenue. The need for all-time connectivity, increased Operators are trying to increase subscriber growth in sales of laptops, growing base so that once their 3G services are businesses across various segments, ease launched, they can migrate the high end of use with plug and play, internet access customers to 3G, thereby currently even in the far-flung areas, download speed sustaining loss but expecting future growth (maximum 3.1Mbps) and flexible monthly in revenues. rental plans (from `49 to `2500) are the major driving factors for the data card
  3. 3. market. This segment is estimated to be services and to generate revenue and arrest worth `740 Cr in FY 2009-10. Most telecom falling ARPUs. operators have entered this market as they are focusing more on data. 3G will further The latest trend among operators and drive this market and give GSM players a Handset vendors is to have their own competitive edge over CDMA players. Sales mobile application stores, owing to their of data cards is expected to grow from 11 popularity and revenue earning potential. mn in ‘09-’10 to 20 mn by the end of 2011. These app stores not only provide a secure single point for customer to get all the latest MVAS mobile applications but also an opportunity for the operators, 3rd party application The 3G scenario in the future will be data providers, aggregators and mobile handset driven and with cheapest call rates in the vendors to coexist. The success of any App world, Indian operators will be focusing store would depend on the Application more on non-voice services as their main portfolio, developer community and the source of revenue. The MVAS revenue for customer awareness. FY’09-10 was `97.6 billion. MVAS currently contributes to 10% of operator’s revenue 3G will give an additional boost to the and is expected to reach `122 billion by the mobile gaming industry, with interactive end of 2010 and 158.6 billion by the end of games, multi player gaming and mobile 2011 thereby contributing to 20 % of gaming contests being introduced. Revenue operator’s revenue. from mobile gaming is expected to reach $250 million by the end of 2010. Mobile advertising is another source of revenue for the operator. At present, it is approximately $25 million and is expected to grow to $56.6 million in 2011. Advertising, which is majorly SMS and IVRS based, will see a shift towards video in the The major drivers for growth in MVAS will coming years. Mobile advertisement and be the increasing demand for mobile data content customization to a certain target connectivity, entertainment, personalized region, demography and behavioral data is content, mobile social networking, also being looked at as a source of revenue enhanced devices and low cost feature rich in both rural and urban areas. The diversity handsets. in languages and dialects in India creates a large potential market for regional content. Entertainment, especially music and cricket, AdRBT will be a major contributor in MVAS has always been highly popular in the revenue in the coming years. Indian VAS market and will continue to do so. However, operators will have to look at Operators are also focusing more on Rural other options like interactive Gaming, LBS, VAS, which is available in atleast 10 m-commerce, in order to differentiate their languages, providing ‘mandi bhav’ (market rates), health & weather info and services like regional CRBT. These services are
  4. 4. available at `15 per month, while the VAS challenges hindering the growth of LBS in services are available at higher price in India is the lack of awareness. So market urban areas. Since the next wave of growth leaders are now focusing on creating is expected from this segment, VAS awareness and educating the mobile users vendors will be focusing more on providing on the concept of LBS introducing newer new services to cater to this segment. devices with navigation capabilities. They These applications in VAS are reducing the need to have focused marketing campaigns digital divide between rural and urban besides showcasing live demonstrations of sectors. the service at various touch points (shopping malls, concept stores, airports IVR systems in local language would be etc) across the country. more popular in the rural scenario. ENTERPRISE MOBILITY Social networking, blogging, browsing and streaming on mobiles will see an There will be an adoption of enterprise exponential increase. In Q1 2010, around mobility technologies and applications to 14.5 mn users accessed social networking increase business efficiency and to deliver sites via applications on mobile and around an enhanced level of customer experience. 30 mn via mobile web browsers. Out of the Enterprises are adopting IP total users, Orkut and Facebook users were communication i.e. IP telephony, unified 14.4 mn and 8mn respectively. The main messaging and voice mail for their voice drivers are the tie-ups between operators solution. The market has grown by 7.3% to and social networking sites, availability of `2200 Cr in FY 2009-10 and is expected to cheaper smart phones, popularity of social grow to `2467 Cr in 2010-11. networking sites, innovative pricing model like pay per site and network coverage even in rural areas. LBS is expected to be the next killer application, which will help cater to a variety of needs including public safety, consumer and enterprise services etc. So telecom operators, handset vendors and GIS companies are now focusing on paid Low cost broadband and cost effective VoIP services like traffic updates, navigation, are driving this segment. point of interest (POIs), location based advertising etc. LBS is expected to cost Audio-video conferencing industry between Rs `100 to 500 a month for continues to be on a growth trajectory and corporate users and Rs `30 to `100 for has become a popular mode of individual users. communication in the enterprise segment. Revenue from this segment increased by Even a subscriber having a very basic 15.2% during FY 2009-10 to `265 Cr and is handset can subscribe and enjoy these expected to exceed `335 cr in 2010-11. The services, as many of these application use major drivers for this growth are SMS and USSD platform. One of the main
  5. 5. Outsourcing, offshoring, globalization, Operators are looking at services like IPTV, mobile workforces and telecommuting. 3G WebTV and MobileTV. They have already and WiMAX will be favorable for High started working on mobisodes, which are definition videoconferencing (HDVC). This mobile episodes, formatted for mobile will also enable the BPO industry to explore phone users. These are relatively shorter in high quality video-based call centers and length i.e 3-5 minutes. Mobile TV is at a hire “work from home” agents. Education very nascent stage in India. Initially it will and healthcare segments will also show an cost around `1.2 for GPRS and content inclination towards visual collaboration charges of 10 paise per KB, to completely technologies. download and watch a mobisode. We will be seeing variety of pricing model like:- pay Convergence per view, daily/monthly rental etc to cater to Telecom operators will focus more on the different need of users. providing bundled services to its subscribers CONCLUSION in order to increase the stickiness. One of the major applications will be Regional content, mobile internet, location- based service, Mobile TV, and M-commerce M-Commerce: - Mobile will become an will emerge as applications of the future. important means of providing remote Enterprises will explore the VAS market to financial and commercial services with a increase the stickiness of the subscriber. 3G maturing MVAS market and support of RBI will play a crucial role in shaping the for mobile banking services. wireless industry and providing triple play M-commerce focuses on banking the services. unbanked person. The various services that can be used with m-commerce are m- banking, m-shopping, m-ticketing, m- marketing, m-entertainment etc. But at present m-Payment market is still at its infancy with the current daily transaction in the range of 5-10 million. Reserve Bank of India is also taking initiatives to promote m- commerce, as it has increased the limit on daily fund transfer per customer and transactions involving purchase of goods/services to `50,000. Although there is a restriction for operators in becoming M- Banking associates. Media convergence will be another service provided by the telecom operators. Presently operators are providing a service in which a subscriber can record a T.V program on their DTH via their mobile.