Telecom Market Lookout

The Great Indian Opportunity..!!

India is at the second-largest position in Telecommunication Market and has the third highest number of internet users in the world. In Between FY 07-16* India’s telephone subscriber base expanded at a Compound Annual Growth Rate (CAGR) of 19.5 per cent to 1,022.61 million and tele density to 80.98. The wireless segment (97.46 per cent of total telephone subscriptions) dominates the market, while the wireline segment accounts for the rest. Urban regions account for 58.58 per cent of telecom subscriptions, while rural areas constitute the remaining.

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Like the rest of the industry, the service provider segment globally, and in India is undergoing a transition thanks to emerging technology trends. The change especially in India is closely associated with other factors that include social, economic and political.

From a technology perspective one of the most talked about trends today is the Internet of Everything (IoE). Expected to create $19 trillion in value over the next 10 years, this gives service providers a tremendous opportunity to create value for both enterprises and consumers. According to Cisco figures, IoE is estimated to create business value of up to $511 billion over the next decade in India. This includes $394.4 billion in the private sector and $116.2 billion in the public sector.

The other opportunities for service providers are the increase in Machine-to-Machine (M2M) connections and proliferation of mobile devices. As indicated by the Cisco Visual Networking Index Global Mobile Data Traffic Forecast for 2014 to 2019, there will be 5.3 billion mobile users as well as 11.5 billion mobile-ready devices, including 8.3 billion personal mobile devices and 3.2 billion M2M connections by 2019.

The Indian telecommunication services market will likely grow by 10.3 per cent year-on-year to reach US$ 103.9 billion by 2020.

Driven by strong adoption of data consumption on handheld devices, the total mobile services market revenue in India is expected to touch US$ 37 billion in 2018.

Smartphone subscription in India is expected to increase four-fold to 810 million users by 2021, while the total smartphone traffic is expected to grow 15-fold to 4.5 exabytes (EB) per month by 2021.

India' has the second largest mobile subscriber base in the world. According to Telecom Regulatory Authority of India (TRAI), the total telecom subscriber base in December 2015 stood at 1.04 billion, out of which 1.01 billion were mobile subscribers and 25.52 million were wireline subscribers.

According to a study by GSMA, smartphones are expected to account for two out of every three mobile connections globally by 2020 making India the fourth largest smartphone market. Total number of Fourth-Generation (4G) enabled smartphone shipments in India stood at 13.9 million units in the quarter ending December 2015, which was more than 50 per cent of total shipments, thereby surpassing number of Third-Generation (3G) enabled smartphone shipments for the first time.

The broadband services user-base in India is expected to grow to 250 million connections by 2018, according to GSMA.

India added the highest number of net mobile phone subscriptions of 21 million during the fourth quarter of 2015.

International Data Corporation (IDC) predicts India to overtake US as the second-largest smartphone market globally by 2018 and to maintain high growth rate over the next few years as people switch to smartphones and gradually upgrade to 4G.

In spite of only 5 per cent increase in mobile connections in 2015, overall expenditure on mobile services in India is expected to increase to US$ 21.4 billion in 2015, led by 15 per cent growth in data services expenditure.

The Indian telecom sector is expected to generate four million direct and indirect jobs over the next five years according to estimates by Randstad India. The employment opportunities are expected to be created due to combination of government’s efforts to increase penetration in rural areas and the rapid increase in smartphone sales and rising internet usage.

India will emerge as a leading player in the virtual world by having 700 million internet users of the 4.7 billion global users by 2025, as per a Microsoft report. With the government’s favorable regulation policies and 4G services hitting the market, the Indian telecommunication sector is expected to witness fast growth in the next few years.

Exchange Rate Used: INR 1 = US$ 0.0148 as on July 11, 2016.

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