Editorial: Maturing mobile data

By: |
Published: March 12, 2016 12:23:32 AM

Usage rises as 3G, 4G base increases

There are clear indications that the Indian mobile data market is finally maturing. At the end of 2015, four years after 3G services were launched, a third of India’s mobile subscribers—310 million—had 3G capable devices, 2.5 times more than the 130 million in 2014. Another 47 million had 4G-enabled devices, accounting for 5% of the country’s mobile subscriber base. In Mumbai, Delhi, Kerala and Punjab, already more than half the devices being used are 3G-enabled. However, only 38% of the 310 million devices have a 3G connection as of now. Despite the lower number of devices being connected, the average monthly 3G data usage, at 753MB, is in sync with the global norm of 800MB to 1GB. Yet it is much lower than the monthly 3G+4G data usage in Japan (2.7GB), South Korea (2.4GB) and the US (1.8GB). The annual Nokia Networks MBiT Index—compiled by user and usage patterns on Nokia networks across India—reveals that while data traffic on 3G networks surged 85% over 2014, overall traffic rose 50%, as 2G data rose just 12%. In the process, 3G traffic outpaced 2G across all telecom circles in the country for the first time.

While the surge in data is happening for now, the continued rise in demand for data could overwhelm telecom operators that have subsisted, till now, on limited voice usage. Data will consume more spectrum than a pureplay voice service. According to a UBS study, data usage per subscriber in India will increase to 1,500MB by 2020 and 2,500MB by 2025. It believes the current crunch for spectrum could be reined in by then, as weak operators exit and larger operators consolidate their positions.

The growth in 3G data usage has been driven by increased data usage in smaller towns, apart from falling smartphone prices. While the cheapest 3G device is now available at $40 against $50 in 2014, the price of 4G devices has halved from $140 to $70 during the period. Over the next few years, as mobile operators expand 3G coverage and roll out 4G, expect to see a sustained increase in average data usage by Indian mobile subscribers. Almost 60% of data usage is for video, audio content and social networking in India. In the use of messaging apps like WhatsApp, the India experience is quite similar to the world, where the average user time is 18 minutes daily. However, data usage patterns in India are different from that in developed markets where high bandwidth applications like videos are accessed on Wi-Fi networks. In India, it is still on mobile networks. The action in LTE would be on the 1800MHz band as 97% of the LTE devices are 1800MHz band compatible. For 2300MHz, it is 83% and just 51% for 850MHz band.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Next Stories
1Real Estate Bill is boon for home buyers, makes builders accountable
2Weak implementation
3Editorial: Sri Sri vs Sewage Canal