Outlook for Indian telecom in 2010

Sridhar Pai, Tonse Telecom
04 Feb 2010

6.      Smartphones hit the mainstream: As prices drop and more features get packed into phones at less ASP, data-capable phones will become ubiquitous. Operators should move to flat rate GPRS packs and expand the range of VAS on offer. This will cause an increase in data traffic and better ARPUs. Our recommendation: offer bundled handsets from this year for a 12 month contract on phones priced at Rs 8000 ($173) and higher. Indian versions of app stores will come of age, but monetization will remain questionable unless a viable push-ad solution can be found.

7.      Tower IPOs: Reliance will float its tower business via an IPO, with another tower operator possibly following suit. Reliance and others have raised valuations sky-high, and it is time to start sharing some of that wealth with the masses.

8.      Managed Services – no looking back here: Managed Services will grow and spill over into the mainstream, becoming the default model of all telecom operators.  Hosted services and bundled options might become common by year-end. Operator-managed services partnerships will become a driving force in multi-location enterprises, with telcos playing key roles in enterprise purchases of high-end IP PBX equipment.

9.      Wimax/BWA opportunity: India will remain under-served by fixed broadband access, offering Wimax/BWA technologies a rich market opportunity. But unless spectrum and regulatory agencies deliver on their promises, this opportunity could get frittered away into fragments: some taken by data cards, some by fixed wireless, others by DSL. Administrative and licensing issues could delay adoption of wireless broadband, with only partial Wimax deployments and limited trials expected for this year.

10.  Wi-Fi and Enterprise: While the industry has been focusing its attention on competing mobile broadband technologies, Wi-Fi has been quietly gaining traction as a complementing feed-in technology for both wired and wireless broadband networks. In some cases, it remains the only solution for wireless broadband. Wi-Fi support will become a lot more prevalent, supported by default in homes and enterprises and on netbooks and handheld phones. Indian Wi-Fi networks will come of age this year as they expand.

Enterprise business apps, such as unified communications, need a champion that can offer nation-wide service suites in hosted mode, and at very attractive prices. Avaya and Cisco are best-positioned to capitalize on this opportunity.
Sridhar Pai is CEO of Banglore-based Tonse Telecom




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