India to ring in 2013 in the mobile sector

By Sunil Dutt
December 17, 2012

(Any opinions expressed here are those of the author, and not those of Thomson Reuters)

For many of us in the mobile industry, 2012 has been a year with a lot to celebrate and a lot to be concerned about. Restrictions and regulations are growing. As we all know, that can cut both ways: too much regulation and we might see constraints on growth.

However, there can be no denying that the National Telecom Policy of 2012 has had a positive effect. I believe the first four objectives of the policy are crucial:

a) to provide secure, affordable and high quality telecom services
b) increase rural teledensity from around 39 to 70 by 2017 and 100 by 2020
c) provide affordable broadband by 2015, to achieve 175 million broadband connections by 2017 and 600 million by 2020
d) and enable citizens to participate in e-governance in sectors such as health, education, banking to ensure equitable growth

In the coming months of 2013, we should see the government putting its money where its mouth is by encouraging and enabling telecom operators to fulfil those targets.

For us in the mobile device business, it is time to re-imagine everything, thanks to the spurt in smartphone adoption, the increasing use of tablets and the growing comfort levels with technologies such as cloud that are making it easy for consumers to access their data from anywhere at any time at low costs.

The lead indicators of what 2013 holds are before us: There are just 27 million smartphone users in India — which is barely 9 percent of total mobile phone users (by comparison, worldwide, approximately 1 in 6 phones is a smartphone). This means there is massive room for growth in smartphone adoption in India. We have barely seen the tip of the smartphone frenzy. The good news is that this pent-up demand will drive amazing innovation in markets such as India and the world will stand to benefit from it.

The growth in smartphone adoption is going to be fuelled by access to better networks. Year on year 3G subscriber growth in India was 841 percent (U.S. was 31 percent, the UK 25 percent, Japan 9 percent and China 115 percent in comparison). There should be no doubt in anyone’s mind where the global growth in the mobile business is going to come from. India is going to be the centre for all the action in the mobile industry in 2013.

The good news is that mobile is not a bubble. Unlike the Internet where users continue to be reluctant to pay for services and where e-commerce operators are failing, mobile users are willing to pay for services. Add to this the potential for mobile commerce, innovation around video that is still in its infancy on the mobile, advertising and app revenues and we have a thriving mobile eco-system.

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