Mobile connections in India are expected to grow 8% to 815 million in 2014 while mobile service revenue is on pace for flat growth, according to Gartner.
“The mobile market in India is going through a rough patch, where voice ARPU is falling very fast, and the increase in data ARPU is not able to fully compensate for the decline,“ said Neha Gupta, senior research analyst at Gartner.
“If the prevailing market conditions do not change in the Indian mobile market, India will account for 12% worldwide mobile connections, but just 2% of worldwide mobile services revenue,” said Gupta.
One of the biggest challenges that Indian mobile operators face is the growing appetite for over-the-top (OTT) voice services. Explosion in personal connected devices, such as smartphones and tablets, is driving consumer appetite for OTT communication.
“Mobile broadband provides a substantial revenue opportunity in India on the back of low fixed line broadband penetration,” added Gupta. “Packing and selling mobile broadband in small and affordable chunks is critical to uptake.”
She said that another area of opportunity is focusing on innovative mobile apps that help increase loyalty of the consumer. These could go beyond the popular category of social and video apps to include utility apps such as shopping apps.
Apps that can provide high user-experience on low tech phones are likely to have higher traction than others. Gupta said operators that engage with popular content and service brands and bundle their apps and services with their data plans will drive consumer interest in mobile broadband.