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Lack of powerful content & spectrum issues bottleneck to mobile internet growth

03-September-2013
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Lack of powerful content & spectrum issues bottleneck to mobile internet growth

It was not long ago when cellular devices were fashioned to make calling and staying in touch easier. The mobile culture soon saw rush of cost effective plans and handsets that bought in the missed call culture and then the SMS culture. It is only in the last few years that mobile has seen immense technological growth, which made it an ecosystem in itself that now has TG, brands, measurement and security.

According to a report by eStatsIndia, mobile internet users in 2011 were 10 per cent of the total internet using population. Thus, out of a 74 million user base, almost 15 million users accessed internet through their cellular device. Also, the country had 17.59 million internet buyers in 2011, out of which there were six million mobile internet buyers and one million pure mobile internet buyers.

However, the past one year witnessed such a boost in the mobile ecosystem that consumption of data through mobile increased phenomenally.

As per the report, while internet users in India will witness a healthy growth to reach 151 million by 2014, mobile internet users will increase from 10 million to 32 million in 2014. The pure mobile internet users will also grow from two million at YE 2012 to reach six million at YE 2014. On an average 80 per cent of these mobile internet buyers are dual users and are not ‘mobile only’ or ‘pure mobile’ internet buyers.

In spite of mobile being in a nascent stage, the medium’s growth is testimony to its strong future. With a huge chunk of audiences referring to their mobile device as a primary screen for various purposes, the medium has exhibited immense potential. However, there are a number of issues such as spectrum, content services on offer and ARPU-related issues that hold the medium back.

Hurdles in the mobile ecosystem
Spectrum became a cursed word for not only mobile, but the entire Indian economy since the 2G scam. The mobile ecosystem has been witnessing hurdles, especially from telecom point of view, due to spectrum related issues.

“The regulators have provided limited spectrum to telcos and that too on bid prices, which are also set high, making the service access (data charges and speed) expensive for the end users,” said Manish Mishra, VP Business Development and Country Manager, BuzzCity.

Mishra pointed out that keeping in mind the current mobile penetration and data usage in the country, regulators need to widen the telco spectrum with reduced prices; it will surely be a catalyst to the growth of the overall mobile sector. “Although it may result in reduced revenues for the regulator, but with the growing demand of data services from the remotest places, a balanced approach can help meet expectations at both ends,” added Mishra.

Content on offer on mobile has been a major issue for a very long time now. Users often find it difficult to access free content on their devices. While they still can get general English and Hindi content online, there is a special demand for regional and niche content. Lack of an acceptable monetisation model does not encourage content creators as well to take up the medium, thus creating a huge need gap.

ARPU-related issues are mainly from the VAS end. “I guess it’s the voice ARPU that is decreasing and reportedly the ARPUs from VAS have been growing for majority of telcos,” explained Mishra.

Mobile is without a doubt the medium of future. However, the ecosystem is now in its trial and error phase and needs time to bloom. With the increasing number of mobile internet users, brands and mobile players will sooner or later come up with solutions, as such gold mines are never left untapped.

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