India’s mobile services market will reach Rs.1.2 trillion in 2013, up 8 percent from 2012 revenue of Rs. 1.1 trillion, according to Gartner, inc. Mobile connections will grow to 770 million in 2013, an 11 percent increase from 712 million connections in 2012.
“The mobile market in India will continue to face challenges if average revenue per unit (ARPU) does not grow significantly,” said Shalini Verma, principal research analyst at Gartner.
Currently, even though India accounts for nearly 12% of worldwide mobile connections, only 2% of mobile services revenues will come from India in 2013. According to Gartner, Indian telecom operators are faced with two major challenges – growing their profit margin in the face of intense competition and successfully competing with over the top service providers, such as Facebook and WhatsApp.
While social and video apps are doing extremely well in India, Ms. Verma said it is time to look beyond these and deliver apps that can have a sustained business model. Operators need to insert themselves into the value chain of these new apps and services. According to data published by the telecom regulator, at the end of February India had 892 million telephone connections out of which 861.7 were in the wireless category.
What are Operators up to?
Operators like Vodafone and Bharti Airtel have gotten creative with data pricing already. For instance, Airtel has launched data sharing plans that allows customers to share unlimited data usage amongst two of their friends or family members or among 3 of his own devices. Vodafone has sachet pricing for Internet plans.
They will also not want a share of revenues from the App ecosystem. Vodafone recently partnered with Irish telecom software firm Aepona to open up APIs. The partnership will open up new revenue streams for Vodafone as third party developers begin using Vodafone APIs to provide solutions and apps for Vodafone consumers.
Nearly 15 million smartphones were shipped in India in 2012. The number grew 35% year over year. Overall, 221.6 mn mobile phones were shipped between January- December 2012, according to a report by Cyber Media Research.
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