The Indian mobile market will reach 1.36 billion connections (SIMs) in 2020, according to a newly released report by Analysys (News - Alert) Mason.
“The Indian mobile market: forecasts and analysis 2011–2020,” indicates that this market will grow at a CAGR of 5.9 percent and of these connections in 2020, 3G and 4G technologies will account for 57.1 percent and 10.7 percent, respectively.
Unique mobile user penetration will reach 54.0 percent in 2020, and this increase is attributed to affordability constraints in rural areas – the research indicated.
Analysys Mason also noted as part of their research that 30 percent of SIMs are inactive presently – which has led to a significant loss to operators. The report suggests operators focus more on customer retention as compared to customer acquisition so that they can optimize their spend on sales and distribution.
“Operators need to understand the multiple-SIM phenomenon and inactivity drivers in emerging markets in order to evaluate their true revenue potential,” said Sourabh Kaushal, lead consultant at Analysys Mason. “The current market structure has resulted in a high proportion of multiple SIMs and inactive users, which camouflages the country’s actual teledensity and makes it difficult to evaluate the market’s true revenue opportunity.”
The report also shows that adoption of 3G services is expected to be limited until 2012, because of expensive 3G data plans and the high cost of entry for 3G enabled handsets.
This scenario is expected to change after 2013 however, with operators migrating 3G-capable handset users to 3G networks.
According to Kunal Bajaj, director at Analysys Mason the decreasing or flat voice ARPU has led non-voice ARPU to become critical for driving revenue growth and notes that in order to drive adoption of value-added services, operators need to control the entire user experience throughout the customer lifecycle process.” “In addition, operators need to ensure user loyalty by tracking customer usage behavior and suggesting possible upgrades or other relevant applications and services,” Bajaj said.
Anuradha Shukla is a contributing editor for TMCnet. To read more of her articles, please visit her columnist page.
Edited by Stefania Viscusi