Indian telecom industry posted the sharpest monthly growth in January 2009 by adding 15.26 Million new subscribers on account of cheaper handsets and low priced services.
Indicating the probable recovery of the Indian economy, the telecom sector in India registered the sharpest monthly growth in terms of new subscribers during January 2009, with 15.26 Million new subscribers added in the month against 10.66 Million new subscribers added in December 2008.
According to the Telecom Regulatory Authority of India, the growth was driven by wireless segment which recorded 15.4 Million new subscribers in January 2009. With this, the overall telephone connections in the country climbed to 400.05 Million at the end of January 2009 from 384.79 Million at the end of December 2008. Moreover, the overall tele-density rose from 33.2% in December 2008 to 34.5% in January 2009. Reliance alone accounted for around 5 Million new subscribers.
The phenomenal surge in the number of subscribers during January 2009 is partly accredited to the entrance of Reliance Communications into the GSM segment with attractive discounted tariff for new subscribers. In fact, subscribers of other operators migrated to new entrant’s services for gaining the benefits offered by it.
Moreover, a big proportion of new subscribers belongs to smaller cities. These subscribers are mostly prepaid customers with lesser minutes of usage. With the introduction of cheaper handsets and low cost cellular services, the affordability of Indian customers substantially escalated, resulting into higher penetration of mobile services.
RNCOS, in its new research report “Emerging Rural Mobile Market in India”, says that the Indian telecom industry is greatly benefitting from the improvement in infrastructure and the introduction of more advanced technologies such as 3G and WiMAX. Rising demand for more hi-tech devices by the young population also supplemented the growth in the Indian telecom industry.
According to a Senior Research Analyst at RNCOS, “Telecom operators need to modify their expansion strategies by adding lucrative packages designed specifically for rural areas considering the fact that broadening of broadband and infrastructure development are their priorities to sustain the growth in future. With the auction of 3G licenses and entrance of new players, the competition in the industry will intensify and growth rate will continue to rise on account of high revenue from value-added services.”
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