Indian Telecom Story (Part I): Up Up and Away!

Exhibit 2

Exhibit 1

Exhibit 3

Exhibit 4

In Q 4 , 2007 India became the fastest growing telecom sector in the world leaving China, US, Indonesia and Pkaistan behind. In fact Indian telecom market added a subscriber base that was equal to the new subscribers of China and US combined. The pace of sub adds has not slowed. Refer to exhibit 4 for details.

In the first quarter of 2008, India surpassed US as the second largest wireless market in the world. It eneded the year with354 million mobile subscribers (both GSM and CDMA combined). In penetration terms, mobile penetration is close to 35%. The September 2008 figures for teledensity was 72.5% for urban areas and 12.7% for rural areas. This figure of 354 million would go to 741 million by 2012 (COAI/TRAI estimates). Thus, the telecom market in India is going to steam ahead at 100 million new subscribers for the next 4 years unabated. That is 25% CAGR. Refer to exhibit 3 for details

At $.02 per call, Indian consumers get the lowest mobile tariffs in the world. (Refer to exhibit 2 for details). Incidentally, the minutes of usage is also amongst the highest in the world. (Refer to exhibit 1 for details.)

Only some time back, the market leader in the Telcos, Airtel (33% market share in India) was voted amonst the 25 most valuable telecom service provider brands. If the top 25 list of telco service providers be drawn by subscribers, BSNL, Idea, Vodafone India would also feature in them!

The next 100 million and three more hundred millions would be rural additions. There seems to be no doubt on this fact as far as TRAI, DOT, Ministry of Telecom and the Telcos are concerned. However, all is not pink in this booming industry. In the next part of this blog, we will examine ARPU trends and Infrastructural bottle necks in this sector.