Mobile operators in India added 10.35 Million new users despite the adverse economic conditions by attracting users with lower call rates and low cost handsets.
The Telecom Regulatory Authority of India (TRAI) stated that in November 2008, Indian mobile operators added 10.35 Million new subscribers, marginally lower than that recorded in October 2008, as reported by Reuters. However, the good news is that it successfully maintained its positive growth amid economic downturn.
At the end November 2008, total wireless subscriber base in India was recorded at 336.08 Million, 49% up on YOY basis. During January-November 2009, the subscriber base rose about 44%, adding 102.45 Million new subscribers.
Bharti Airtel, the leading mobile operator in November 2008, added 2.72 Million new subscribers. As a result, its subscriber base expanded by 82.9 Million.
The major factor that governed the increase in the number of wireless users is the lower call rates. In India, the call rates are around 1 cent per minute. Thus, a larger number of people are shifting from fixed-line to mobile phones. This pushed the fixed-line user base to 38.05 Million in November 2008 from 38.22 Million in October 2008.
Currently, Indian mobile operators are attracting new users by extending their infrastructure to cover smaller villages and towns that are still largely untapped and thereby, increasing mobile penetration in these regions. Additionally, low cost of handsets is also supporting the growth of mobile industry.
As TRAI is expected to review the termination charges, further decline may be seen in telecom tariffs. When a subscriber of an operator (say Airtel) calls the subscriber of another operator (say Vodafone), then the first operator pays termination charge to the second. At present, termination charges are 30 paise a minute. Hence, with the reduction in termination charges, call rates are obvious to fall.
According to a Research Analyst at RNCOS, “The Indian mobile market is registering significant growth despite the global financial recession. In this economically tough phase, factors like large customer base and lower penetration level are supporting the mobile market. The penetration rate of nearly 33% indicates the immense potential the country’s mobile market has.”
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