Increased data usage fuels growth of mobile market

by CXOtoday Staff    Mar 03, 2010

South Asian countries including India are characterized by low mobile penetration rate, and have presence of cluster of operators. These markets, under growth phase, are experiencing a downward pressure on average revenue per user (ARPU). Therefore, telecom service providers are unleashing attractive packages to add value to mobile data services to stave off ARPU decline.

"Although the customers are benefiting from the declining call rates and innovative tariff plans, low calling rates are pressurizing the mobile operators, due to the decline in revenue margins" says Lokeshwari Nautiyal, Frost & Sullivan senior research analyst.

Though India has the highest subscription growth rate in the low penetration South Asia market, there is the huge untapped market in the region and is expected to translate into high subscriber growth rate between 2009 and 2015. Most of increased base will be on prepaid services resulting in further rise of prepaid subscriber percentage in these countries.

"High uptake of services such as MMS, mobile web browsing, call conferencing, call forwarding, call waiting, mobile banking, and access to other data services are enhancing the outlook for mobile data services market," adds Santosh Kumar Sinha an industry analyst.

Intense competition has prompted participants to decrease tariffs, in order to acquire or maintain their market share. To acquire subscribers, operators are launching new schemes and plans with low call rates. With the decline in tariff and handset prices, affordability of the customer is increasing, irrespective of the income of the customer, significantly boosting mobile subscription growth.