Indian Telecom Industry:CDMA subscriber base reaches 50 million mark

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CDMA vs. GSM? – Which is more ubiquitous? Well, the obvious answer is GSM, but this answer may not be that obvious few years down the line – CDMA is quickly catching up with GSM; and the subscriber base (for CDMA) in India has already surpassed 50 million fixed and mobile device users.

As per the report from CDG,

  • 50 million subscriber growth reached this milestone only four years after the technology’s introduction to the market, while it it took GSM more than ten years to reach the same number.
  • CDMA growth rate exceeds than that of GSM on a monthly basis (5% vs. 4,1%).
  • With up to 2.01 million net subscriber additions in June 2007, CDMA2000’s 5 percent growth rate exceeded that of GSM, at 4.1 percent,.
  • Reliance Communications and Tata Teleservices, are among the top 20 fastest-growing operators in the world.
  • CDMA2000 is quickly becoming the technology of choice for emerging markets.
  • Reliance has embarked on one of the largest CDMA2000 network expansions on the planet—with plans to reach more than 20,000 towns and 300,000 villages.

cdma gsm market share
Key reasons behind this growth are:

  • Availability of very low-end (VLE) handsets – There are currently 45 VLE CDMA2000 devices from 14 suppliers available below US$50 in wholesale price.
  • Rapid expansion of the CDMA2000 networks into the rural areas of India to deliver state-of-the-art telephone and broadband Internet access
  • Price gap between 2G GSM low-end handsets and 3G CDMA2000 handsets has narrowed to only $4 USD

[Source: CDG]

To add to this, BSNL is also pursuing it’s CDMA strategy very strongly (after it faced capacity crunch in GSM segment)

Summary of Indian Telecom Subscriber base

Overall, the total number of telephone subscribers in India has reached 225.21 million (i.e. 22.5 crore, and the overall tele-density now stands at 19.86). Here is the breakup:

  • Total wireless subscriber base stands at 185.13 million
  • Total wireline subscriber base is 40.09 million

Of the 7.34 million wireless (GSM, CDMA, WLL-F) subscribers that were added in June,

  • GSM additions were 5.2 million, and
  • CDMA accounted for 2.1 million.

Teledensity in India

  • Teledensity in India is low with 50 per cent of the area and 40 per cent of the population not covered by the service providers.
  • To connect the unconnected, the operators needed to invest around Rs 50,000 crore per year
  • CDMA operators are demanding MNP (mobile number portability) while GSM operators are opposing that. [source]

I do see an increasing demand for CDMA phones – they have more packaged features (FM radio/music player) and are available at a very cheap price (in local colorful flavors).

Having said that, CDMA may not be the ‘executive phone’, but definitely has a strong appeal for the ‘Bottom of Pyramid‘ segment.

What do you think? If you use GSM, what will make you switch to CDMA?Apart from the price/value benefit, does CDMA has a better network quality/coverage?
Or will you prefer dual mode phones (Spice Telecom has already launched dual mode cellphone) ?

Please share your comments.

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, Image credit:india-cellular

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