10 interesting facts about India’s telecom sector

In a wide-ranging report covering the growth of the telecom sector in the country, the Telecom Regulatory Authority of India has credited the ultra-low cost of handsets and low tariffs for the boom in the telecom sector.

According to the report, titled ‘Telecom Sector in India: A Decadal Profile’, the subscriber base in India, which stood at 943.49 million in February 2012 as against 28.53 million in April 2000, is skewed in the favour of urban India. It said urban teledensity in the country was 4.4 times that of rural density.

Here are 10 interesting findings of the report:

1. Available international comparisons show that India has the second largest number of telephone subscribers in the world (among 222 countries), accounting for 12 per cent of the world’s total telephone subscribers. It is also one of the fastest growing in terms of telecom subscribers.

2. Mobile tariffs in India are the second lowest in the world after Bangladesh. Countries with the highest mobile tariffs include Austria, Venezuela, Greece, Portugal, Australia, Japan, Spain, Switzerland, France, and Brazil.

3. Mobile phones accounts for nearly 96.6 per cent of the total telecom subscriptions, and more than 95 per cent of wireless connections are prepaid.

4. Around 431 million wireless subscribers in India subscribe to data services. This implies that 48.26 per cent of total wireless subscribers are capable of accessing data services/Internet on their mobile phones.

5. Wireless phones dominate the market in India and the wire-line phone segment constitutes merely 3.4 per cent of the total subscriber base.

6. The telecom sector has received on average 8.2 per cent of total inward FDI between 2000–01 and 2010–11. Most of the FDI has gone to the cellular mobile segment.

7. The share of telecom services (excluding postal and miscellaneous services), as a percentage of the total GDP of the country, has increased from 0.96 in 2000–01 to 3.78 in 2009–10.

8. From 2001 to 2011, the total number of telephone subscribers has grown at a compound annual growth rate (CAGR) of 35 per cent. The comparable rates in the 1980s and 1990s were 9 per cent and 22 per cent, respectively.

9. GSM continues to be the dominant technology for wireless phones with an 87.9 per cent share. Bharti is the dominant player in GSM segment accounting for 22.35 per cent of the market in terms of market subscriptions followed by Vodafone (18.80 per cent), Idea (13.53 per cent) and Reliance (12.05 per cent). There are as many as 14 operators using GSM technology compared to just six using CDMA. Reliance is the leading player in the CDMA market with 51.32 per cent share.

10. Urban teledensity is approximately 4.4 times higher than rural, showing the digital divide that exists in India. There are wide variations in penetration of telecom services across states. States such as Delhi, Tamil Nadu, Kerala, Himachal Pradesh and Punjab have relatively high teledensity. However, states such as Assam, Bihar, Madhya Pradesh, UP, Jammu and Kashmir and the North-Eastern states have relatively low teledensity. The numbers show that teledensity in Delhi is 5.1 times higher than that of Assam.