With voice use declining in comparison to data, revenue from data in the telecom industry has witnessed major growth in the past one year. For instance, revenue from data, which contributed around 36% to total industry revenue in April-June 2017, almost doubled to 71% during April-June 2018.
An analysis of the latest industry data from the Telecom Regulatory Authority of India (Trai) shows that during April-June 2017, the industry’s total revenue stood at Rs 20,549 crore, of which data contributed Rs 7,301 crore. A year later during the same period, while total revenue was at Rs 18,136 crore, revenue from data use skyrocketed to Rs 12,870 crore. While revenue from data use grew 76% YoY in April-June 2018, that from voice and SMS declined. Revenue from SMS fell 31% YoY to Rs 521.8 crore in April-June, whereas for voice, the decline was steeper at 62% YoY to 4,744.62 crore. Analysts said it’s understandable that with telcos providing free voice with 100 free SMS per day, and also low-cost tariff plans with data for as low as Rs 3-5 per GB, the decline in revenue contribution by the former and rise in data revenue is on expected lines.
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They added that voice and SMS revenues will decline further as low-cost bundled plans have now become an industry standard. Operators, too, are focusing on increasing data usage and are offering various incentives like cashbacks on purchasing smartphones and premium video and music content.
The battle now is for market share and on increasing data consumption. In such a scenario, where operators are competing against each other to gain market leadership, it’s the subscribers who are gaining the most, not just in terms of dirt cheap data and free voice, but also better content offerings and speed. This is resulting in higher data consumption. For instance, total data consumption rose over two-fold to 1.04 crore terabytes (TB) in April-June 2018 as against 42.09 lakh TB a year ago (1 TB equals 1,000 GB). Similarly, data consumption per subscriber per month was higher by a whopping 146% YoY at 3.2 GB in during the same period this year.
Data prices, too, have witnessed an unprecedented decline during this period, especially since the commercial launch of Reliance Jio in September 2016. Prices plunged multifold to Rs 3.5 per GB in September 2018 from around Rs 250 per GB two years back. Analysts now anticipate 4G data consumption to rise further as operators focus on providing more content to subscribers. They are investing on digital offerings and, in turn, a burgeoning digital ecosystem is revolutionising consumption. For instance, 4G’s contribution to total wireless data usage hit a record 85% compared to 15% for 2G and 3G combined during April-June 2018, while a year back, 4G data consumption versus 2G+3G was in the ratio of 80:20.