NYT : India Is World’s Fastest Growing Cellular Market

Saturday, September 16, 2006

India has become the fastest-growing cellular market in the world, adding a net 5.9 million cellular subscribers in August, the Cellular Operators Association of India said this week.  The gain outstripped China’s increase of 5.19 million subscribers.  Large areas of India remain too poor or remote to have cellphone service, even though the middle class is growing in many cities.  As poverty slowly eases, the explosive growth in cellphone use is expected to continue in this nation of 1.1 billion people.  Factors like low calling charges and cheap handsets are also behind the subscriber gains.  India’s charges per minute are said to be the lowest in the world, as service providers offer deals that include a lifetime of unlimited incoming calls for a one-time fee of 1,000 rupees ($21.75)…..India currently has more than 123 million mobile phone subscribers, well behind the 430 million in China, and it is not expected to catch up for many years…..

According to specialists, the next growth spurt will come when mobile service becomes widely available in the villages.  To further this trend, the telecommunications regulator, the Telecom Authority of India, is considering a proposal to allow rival companies to share infrastructure. “Then, a hundred flowers will bloom,” said the authority’s chairman, Nripendra Mishra, borrowing a famous phrase from Chairman Mao Zedong…..The Finnish cellphone maker Nokia recently introduced a mobile handset model costing the equivalent of $43.50, its lowest price globally for the handset, in partnership with Reliance Communication, one of India’s largest telephone service providers.  Subscribers are responding to offerings like the Don’t Stop Mobile plan of Tata Teleservices, which includes a handset and unlimited talk time for two years for just over $30…..For the service providers, though, the competition-driven decline in tariffs is squeezing revenue. India has the lowest average revenue per user in the world, and analysts say they expect revenue to fall further. So the rival companies are offering additional features like text messaging, ring tones and video downloads to entice subscribers to spend more…..

Reference : http://www.nytimes.com/2006/09/15/business/worldbusiness/15cell.html?_r=1&ex=1315972800&en=0403a2d517eece9b&oref=slogin

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