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Mobile Revolution in India

Posted on Wednesday, Apr 11th 2007

By Sujai Karampuri, Guest Author

We have seen the Mobile Revolution in India. It is still happening. There are enough indicators to suggest that Mobile penetration will exceed 400 million subscribers in India in the next few years. Let’s pause and go back a few years, say 2001. Could any analyst predict that we would have 200 million subscribers by end of 2006? Could anybody in the industry predict that we would be adding more than 5 million subscribers a month?

The growth of mobile penetration is mind-boggling and is quite dramatic. It came about because of some of the factors listed below. Note that it is always easy to look back and analyze why it happened. That’s what I am doing here.

Key Factors for this explosion

* Late start
* Cheaper equipment
* Innovative and Bold Deployment Strategies
* Population

First, India embraced cellular when 2G systems were already deployed in most parts of the world. Having completely skipped 1G because of late start, India went straight to the superior 2G systems. Most of the lessons learnt by the European deployments could be transferred to India.

Second, India embraced GSM nearly eight years after it was taken up in Europe. Most of the equipment had already become very cheap by then. This allowed for mass deployment in the country.

Third, India embraced certain bold strategies- like that of Airtel which has outsourced complete network deployment to Ericsson and management of networks to IBM. However, a note of caution here- they were quite stupid not to have implemented sharing of tower infrastructure right from day one. They seem to have woken up quite late on this.

Fourth, with a billion people anything you do seems to pick up volumes.

All these factors put together has resulted in mind-boggling and dramatic mobile penetration in India.

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3G would be soon coming to India by 2008, I heard, after of course our defence ministry releases the band it requires.Though TRAI , is giving pressure for faster deployment of these services, it also wants to control the content which shall be distributed and shared.
Penetration of 3G will definitely take some time, lets say 3 years when 3G handsets become cheaper and the service wont cost much

Pawan Sahay Wednesday, April 11, 2007 at 5:15 AM PT

Sramana,

Do you think that there is a potential for IDEAL SCREEN in Mobile ?. What Can be done for the ideal Screen when Mobile is kept under stand by mode.


mahesh

Mahesh Wednesday, April 11, 2007 at 7:02 AM PT

The growth of Indian mobile use comes as no surprise. When I was working at a Europe telco in 2001 I recall seeing analyst reports stating that European mobile penetration would peak at 20%!

Even in Africa mobile demand is massively out-stripping network capacity. The Indian market is ripe for mobile telephony demand and I’ve no doubt the growth will continue until the market reaches saturation at something around the 60-75% mark, allowing for the 25% of the population living below the poverty line.

Vodafone expects mobile penetration to exceed 40% in India by 2012.

The capital intensive nature of the telephony business will mean that as the subscriber base continues to grow, the marginal costs will fall enabling cheaper and cheaper handsets and calls, further pushing out expansion.

The key issue will be whether the networks can cope with the level of customer services needed for extremely large subscriber numbers.

Matt Rogers Wednesday, April 11, 2007 at 9:11 AM PT

Mahesh,

Define Ideal Screen.

Sramana

Sramana Mitra Wednesday, April 11, 2007 at 10:35 AM PT

The penetration of these services like GPRS is not much in India. and also not many people are accessing internet through mobiles. Like in other countries where mobile blogging and surfing is a very frequent activity.

manish Wednesday, April 11, 2007 at 11:28 AM PT

The data to provide a meaningful GPRS service doesn’t exist in India yet, Manish. That’s why I suggested a Navteq Concept arbitrage earlier. Sramana

Sramana Mitra Wednesday, April 11, 2007 at 11:51 AM PT

Definition of Ideal Screen in Mobile.

Ideal screen of the Mobile. It is the one when mobile is kept under no operation mode similar to Screen saver of PC which gets activated after few minutes when there is no activity using keyboard, mouse etc.


mahesh

Mahesh Wednesday, April 11, 2007 at 11:31 PM PT

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