India - an attractive market despite rock-bottom ARPU

India - an attractive market despite rock-bottom ARPU

India remains a fascinating mobile market. Recent growth has exceeded our expectations, and the regulator’s over-enthusiastic predictions for future market development seem less outlandish. Growth will largely come from rural areas going forward. For operators this means significant network investments and lower call charges in order to make mobile communications affordable for the majority of consumers. But can operators continue to perform in this environment beyond this initial acquisition phase? And as ARPU reaches new lows, will they be able to invest for growth? It seems that the answer is a resounding yes. This report provides an overview of this complex and exciting market.

Table of contents

Key messages

Ovum view

Market overview and trends

Mobile dominates the Indian telecoms landscape
GSM operators continue to lead with a combined 70% share of connections
Expansion and tariff cuts drive uptake
ARPU will continue to drop despite MoU increase
Regulatory impact – competition and growth
Handset market – distribution and brand

Operator analysis

Overview
It there room for consolidation and new launches?
Bharti Airtel
BSNL (CellOne/Excel)
IDEA Cellular
Hutchison India / Vodafone Essar
Reliance (Reliance Infocomm)
Tata Teleservices (Tata Indicom)

Table of figures

Figure 1 India mobile connections and growth, 2000–2006
Figure 2 India Mobile connections and growth forecast, 2005–2011
Figure 3 CDMA and GSM connections in India, 2000–2011
Figure 4 GSM connections by service area, 2006–2007
Figure 5 Connections by service area, 2003–2005
Figure 6 GSM connections by service area, 2006–2007
Figure 7 CDMA and GSM ARPU in India, September 2006
Figure 8 Overview of India’s main operators
Figure 9 Market share of connections by operator, 2003–2006
Figure 10 Blended GSM ARPU by operator, Q3 2006