India accounts for 12 percent of the world’s mobile connections, but just 2% of the world’s mobile services revenue, IT researcher Gartner said in a report.
Mobile connections in India will grow to 815 million in 2014, an 8 percent increase from 755 million connections in 2013, according to Gartner, Inc. The mobile services market in India will remain almost at the same level as 2013 at $19.2 billion in 2014.
The average revenue per user in India is around 150 rupees per connection per month. For CDMA operators like Reliance Communications and Tata DoCoMo, it is below 100 rupees per month.
“The mobile market in India is going through a rough patch, where voice average revenue per user (ARPU) is falling very fast, and the increase in data ARPU is not able to fully compensate for the decline,“ said Neha Gupta, senior research analyst at Gartner.
“If the prevailing market conditions do not change in the Indian mobile market, India will account for 12 percent worldwide mobile connections, but just 2 percent of worldwide mobile services revenue.”
One of the biggest challenges faced by Indian mobile operators is the growing appetite for over-the-top (OTT) voice services. Explosion in personal connected devices, such as smartphones and tablets, is driving consumer appetite for OTT communication. Examples of OTT services are WhatsApp, Viber, Google Hangouts, Skype etc..
“Mobile broadband provides a substantial revenue opportunity in India on the back of low fixed line broadband penetration. Packing and selling mobile broadband in small and affordable chunks is critical to uptake,” said Ms. Gupta.
Another area of opportunity is focusing on innovative mobile apps that help increase loyalty of the consumer, Gartner said. “These could go beyond the popular category of social and video apps to include utility apps such as. shopping apps. Apps that can provide high user-experience on low tech phones are likely to have higher traction than others. Operators that engage with popular content and service brands and bundle their apps and services with their data plans will drive consumer interest in mobile broadband.”