According to Gartner, cellular data services will account for 20.5 per cent of total cellular service revenues in 2008, equivalent to Rs 147.6 billion. Overall, India’s mobile services market will grow by a compound annual rate of 28.3 per cent during the next five years to touch Rs 718 billion in 2008.
Last year, wireless data services accounted for 5.4 per cent of cellular service revenues in India; a large chunk of which came from SMS traffic.
“India’s unified licence regime has given an impetus to growth. Regulatory constraints are being eased in response to unrelenting market pressures, creating ideal conditions for a dramatic new phase of growth, investment and consolidation,” said Gartner.
In the context of the attrition of voice ARPU (average revenue per user), operators need to re-focus on cost control and margin enhancements.
Gartner maintains that if operators have to look towards mobile data services to improve business profitability, they will need to evolve to higher speed, higher capacity networks for voice and data services. Gartner vice-president and research director Geoff Johnson said: “A more positive outlook for IT, telecommunications and networking in 2004 has caused many enterprises and suppliers to review their stringent cost-cutting approaches of the recent years and begin to focus on growth again.”
Gartner India principal analyst (telecom) Kobita Desai said: “Indian cellular operators are realising that voice-only services are not generating adequate revenues and are exploring ways to offer more value-added services to increase ARPU.”