Indias Mobile Connections to Exceed 771 Million by 2013 from 452 Million in 2009
Total mobile services revenue in India is projected to grow at a compound annual growth rate (CAGR) of 12.5 percent from 2009-2013 to exceed US$30 billion, according to Gartner, Inc. The India mobile subscriber base is set to exceed 771 million connections by 2013, growing at a CAGR of 14.3 percent 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.
“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 will also be triggered by increased adoption of value-added services, which are relevant to both rural and urban markets.”
Mobile market penetration is projected to increase from 38.7 percent 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 percent of all mobile connections in 2008 and it is expected to grow to more than 96 percent 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 percent from 23 million in 2008.
The churn rate in India is 53.2 percent in 2009, and despite a maturing market, the ratio is expected to increase to 59.6 percent in 2013.
Data revenues driving growth
Revenue from data services will significantly contribute to the overall growth of mobile services in India, with a CAGR of 16.8 percent 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 percent in 2008 to 86 percent in 2013.
Expected changes in the Indian Telecom landscape
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.
Additional information can be found in the report “Forecast: Mobile Services, Asia/Pacific, 2004-2013 which can be found on Gartner’s Web site at http://www.gartner.com/DisplayDocument?ref=g_search&id=986221&subref=simplesearch
Gartner, Inc. (NYSE: IT) is the world's leading research and advisory company. The company helps business leaders across all major functions in every industry and enterprise size with the objective insights they need to make the right decisions. Gartner's comprehensive suite of services delivers strategic advice and proven best practices to help clients succeed in their mission-critical priorities. Gartner is headquartered in Stamford, Connecticut, U.S.A., and has more than 15,000 associates serving clients in 11,000 enterprises in 100 countries. For more information, visit www.gartner.com.
Comments or opinions expressed on this blog are those of the individual contributors only, and do not necessarily represent the views of Gartner, Inc. or its management. Readers may copy and redistribute blog postings on other blogs, or otherwise for private, non-commercial or journalistic purposes. This content may not be used for any other purposes in any other formats or media. The content on this blog is provided on an "as-is" basis. Gartner shall not be liable for any damages whatsoever arising out of the content or use of this blog.