COAI Prsentation-13 Sept 2005- Evolution of GSM in India
Content
Evolution of GSM in India
T V Ramachandran, Director General September 13, 2005
Status of GSM Industry Cellular services started in India in 1995; GSM was the mandated
standard. Above Government decision proved to be beneficial for India as
GSM has been established as the dominant standard. As of August 2005, there were nearly 50 million GSM subscribers
which constitutes 80% of the total cellular subs. The month of July and August witnessed record growth in GSM
subscriber addition of about 2 million. 75% of the new mobile subscribers in India choose GSM. There are 83 state-of-the art Networks of GSM. Roll out of services in more than 4,000 town & cities and more
than 60,000 villages. Total Private GSM Investments are over Rs 50,000 crores.
GSM-Fixed Crossover achieved in April 2005.
GSM Growth Through the Years 45
40
n o i l l i m n i s e r u g i f b u S
35
CPP
30
3rd & 4th Cellular
25
20
NTP’99
15
10
5
0 1997
1998
1999
2000
2001
2002
2003
2004
2005
Year ended April
Several points of inflexion in the past, have given kick-start to improved cellular growth
Steeply falling tariffs have ensured affordable services to a large subs base Rates per minute have fallen by over 90% in the last seven years. Effective charge (in Rs. Per min)
Subscriber Base (in mn)
16
Lo w e r ing o f A D C f ro m
14
14
14 ) n i
revenue
NTP'99
51.53
CPP
12
50
Introduced
m r e p 10 . s R n 8 i ( e g r a h c e v i t c e f f E
60
3 0 %t o 1 0 %o f s e c t o r
40 33.31
3 r d & 4 t h C e l l ul a r Operator
6
30 Introduction of CDMA
6 3.58
4 2 0.88
1.2
1.88
3.58
20 13
2 6.5
10 1.6
0.44 0.4 0
0 1998
1999
2000
2001
2002
2003
2004
2005
) n o i l l i M n i ( e s a b r e b i r c s b u s e l i b o M
GSM - the dominant standard in India GSM constitutes around 80% of the cellular market in India. GSM
60
CDMA
50 n m 40 n i 30 s b u 20 S
10 0 2000
2001
2002
2003
2004
2005
Market share of GSM continues to rise steadily
GSM Increasing its Market Share Globally Indian GSM industry is in sync with the worldwide standards; worldwide GSM constitutes 75% of the subs base and 80% of the monthly additions. GSM CDMA 1600 GSM CDMA Launch 1400 Launch 1200 m 1000 n i 800 s b 600 u S 400 200 0 2 9
4 9
6 9
8 9
0 0
2 0
4 0
GSM Advantages GSM advantages over other cellular technologies are: Dominant global market share of GSM gives benefits:
Large number of infrastructure and handset vendor’s giving advantage in terms of price and other commercial terms. Innovations ahead of CDMA e.g. single chip handsets.
Widest choice of handsets with widespread sales and service
distribution network. Handset availability in all price segments and ongoing
introduction of wide variety to meet customer requirements. Easy subscription process (SIM based) Widespread prepaid solutions Seamless interoperability between networks and handsets. Global footprint for international roaming including SMS, data
and other value added services.
GSM Overall Efficiency For Subscribers Low cost entry handsets Wide choice and
availability of handsets International roaming Easy subscription
For Operators Economies of scale due to
dominant market share: worldwide and India Choice of multiple
vendors Capex optimisation Lower subscriber
acquisition cost Seamless interoperability
Affordable Services for Common Man Mobile has fast moved from a class service to a mass service for the common man – fuelled by continuously falling tariffs and increased coverage. Connectivity for the farmers
Better prices for the produce
Affordable Services for Common Man Affordability has made mobile services the key plank for economic development.
Mandi Prices on the Move
Kerala Fishermen Call in their Catch
NEW REVENUE OPPORTUNITIES – VAS health tips
Airtel Live portal with games, music, cricket, stock, news, easy charge facility, logos, range of voice activated services, games, missed call alerts, Airtel Live, Hello Tunes etc. Hutch Online Yahoo & MSN Messenger, Java based games, missed call alerts, logos, games, news, stock, range of voice activated services, Caller Tunes, etc. Idea
ringtones
Daily horoscopes, cellular jockey to send musical greeting cards, voice activated services, music, logos, news, stock, movies, cricket, games, jokes, Dialer Tones, etc. BPL Ringtones, logos, picture messages, send-asong, mobile gaming, etc. Spice
mobile gaming
Ringtones, logos, picture messages,SMS Chat, mobile gaming, etc. Aircel
Revenues Form Value Added Services VAS Revenue as % to Net Service Revenue 10% 8% 10% 9%
9% 9%
VAS Revenue composition for 2004 (in %) 27%
65%
7%
8% 7% 6% 5%
3%
4% 3% 2%
8%
1% 0% 2003
Postpaid
2004
Prepaid
Total
S MS
Clip
Ot he rs
VAS shows promising trends, share in total net service revenue increasing continuously
Potential of the Sector Private GSM subscriber base has the potential to
reach 103 million subscribers by Dec’07 from the present level of 36 million in August’05. Projected growth of private GSM sector is as
given below: In Million Year ending Private GSM
Dec. 2004 (Actual) 28
August 2005 (Actual) 36
Dec 2005 (Projected) 42
Dec. 2006 (Projected) 65
Dec. 2007 (Projected) 103
This will contribute in a substantial manner to overall target of 250 mn telephone subs (fixed+mobile) by 2007 set by the Government
Push Towards Next Generation India represents one of the most exciting
opportunities for mobile services in the coming decade. We are already providing 2G and 2.75G services. The next big push would be the introduction of
3G services.
Early and expeditious introduction of 3G services in India will hold the key to India’s mobile success and its future dominance in mobile telephony
3G in India 3G will be introduced in India by 2006. 3G upgradation for GSM is 3GSM (WCDMA). In India GSM constitutes 80% of the total cellular
market; this will form a ripe base for 3GSM (WCDMA). Worldwide also 3GSM (WCDMA) drives the 3G
growth.
GSM - Predominant Global Mobile Standard for 3G 35
3GSM (WCDMA) 30
CDMA 2000 1xEVDO
25
20
15
10
5
0
4 0 ' r p A
4 0 ' y a M
4 0 ' n u J
4 0 ' y l u J
4 0 ' g u A
4 0 ' p e S
4 0 ' t c O
4 0 ' v o N
4 0 ' c e D
5 0 ' n a J
5 0 ' b e F
5 0 ' r a M
5 0 ' r p A
5 0 ' y a M
5 0 ' n u J
As of date, 3GSM subscribers have crossed 30 million , accounting for around 70% of the 3G market . GSM share continues to rise month after month
5 0 ' y l u J
Benefits of 3G for India 3G has a 4-5 times higher voice capacity than present 2G
services. An ideal platform to deliver low cost voice telephony to Indian consumers. 3G has hi-speed data capabilities It
will fulfill the content rich mobility experience for urban Indians.
3G will help in enhancing India’s competitiveness in the
ITES / BPO segment. Extremely effective tool in driving penetration of the huge
addressable market in the rural areas. 3G will also enable achieving the broadband objectives of
the Government. 3G will integrate India and Indian consumer with the far reaching developments taking place across the world.
Mobile Broadband – The Next Frontier Mobile phone is fast becoming the dominant technology
for voice communications. Mobile phone is becoming less & less of a narrowband
device as it evolves through 2G to 2.5G to 2.75G to 3G. “the mobile phone has moved beyond being a mere
device to become a key “social object” present in every aspect of our daily lives”. Lara Srivastava, ITU
3G probably provides the best ubiquity in broadband connectivity – always on, fast enough….
India’s Path to Mobile Broadband India’s path to Mobile Broadband must be through 3G in the
WARC-92 identified Core Band of 1920-1980 MHz p/w 2110-2170 MHz because : Only band globally harmonized for interference free coexistence of both GSM & CDMA Equipment available for both technologies in this band Majority of countries have opted for 3G in the Core Band Japan & Korea live examples where GSM & CDMA are coexisting in the Core Band India by choosing this globally adopted spectrum band will be able
to avail of Economies of scale – lower tariffs Seamless roaming Inter-operability Interference free operations India being a country where both GSM & CDMA co-exist must
choose a 3G path which allows for the co-existence as well as future growth & development of both technologies
GSM has been the prime growth driver of Telecom services in India and would continue to be the same for new evolving technologies and will contribute to the growth and prosperity of the industry.
THANK YOU [email protected]
T V Ramachandran, Director General September 13, 2005
Status of GSM Industry Cellular services started in India in 1995; GSM was the mandated
standard. Above Government decision proved to be beneficial for India as
GSM has been established as the dominant standard. As of August 2005, there were nearly 50 million GSM subscribers
which constitutes 80% of the total cellular subs. The month of July and August witnessed record growth in GSM
subscriber addition of about 2 million. 75% of the new mobile subscribers in India choose GSM. There are 83 state-of-the art Networks of GSM. Roll out of services in more than 4,000 town & cities and more
than 60,000 villages. Total Private GSM Investments are over Rs 50,000 crores.
GSM-Fixed Crossover achieved in April 2005.
GSM Growth Through the Years 45
40
n o i l l i m n i s e r u g i f b u S
35
CPP
30
3rd & 4th Cellular
25
20
NTP’99
15
10
5
0 1997
1998
1999
2000
2001
2002
2003
2004
2005
Year ended April
Several points of inflexion in the past, have given kick-start to improved cellular growth
Steeply falling tariffs have ensured affordable services to a large subs base Rates per minute have fallen by over 90% in the last seven years. Effective charge (in Rs. Per min)
Subscriber Base (in mn)
16
Lo w e r ing o f A D C f ro m
14
14
14 ) n i
revenue
NTP'99
51.53
CPP
12
50
Introduced
m r e p 10 . s R n 8 i ( e g r a h c e v i t c e f f E
60
3 0 %t o 1 0 %o f s e c t o r
40 33.31
3 r d & 4 t h C e l l ul a r Operator
6
30 Introduction of CDMA
6 3.58
4 2 0.88
1.2
1.88
3.58
20 13
2 6.5
10 1.6
0.44 0.4 0
0 1998
1999
2000
2001
2002
2003
2004
2005
) n o i l l i M n i ( e s a b r e b i r c s b u s e l i b o M
GSM - the dominant standard in India GSM constitutes around 80% of the cellular market in India. GSM
60
CDMA
50 n m 40 n i 30 s b u 20 S
10 0 2000
2001
2002
2003
2004
2005
Market share of GSM continues to rise steadily
GSM Increasing its Market Share Globally Indian GSM industry is in sync with the worldwide standards; worldwide GSM constitutes 75% of the subs base and 80% of the monthly additions. GSM CDMA 1600 GSM CDMA Launch 1400 Launch 1200 m 1000 n i 800 s b 600 u S 400 200 0 2 9
4 9
6 9
8 9
0 0
2 0
4 0
GSM Advantages GSM advantages over other cellular technologies are: Dominant global market share of GSM gives benefits:
Large number of infrastructure and handset vendor’s giving advantage in terms of price and other commercial terms. Innovations ahead of CDMA e.g. single chip handsets.
Widest choice of handsets with widespread sales and service
distribution network. Handset availability in all price segments and ongoing
introduction of wide variety to meet customer requirements. Easy subscription process (SIM based) Widespread prepaid solutions Seamless interoperability between networks and handsets. Global footprint for international roaming including SMS, data
and other value added services.
GSM Overall Efficiency For Subscribers Low cost entry handsets Wide choice and
availability of handsets International roaming Easy subscription
For Operators Economies of scale due to
dominant market share: worldwide and India Choice of multiple
vendors Capex optimisation Lower subscriber
acquisition cost Seamless interoperability
Affordable Services for Common Man Mobile has fast moved from a class service to a mass service for the common man – fuelled by continuously falling tariffs and increased coverage. Connectivity for the farmers
Better prices for the produce
Affordable Services for Common Man Affordability has made mobile services the key plank for economic development.
Mandi Prices on the Move
Kerala Fishermen Call in their Catch
NEW REVENUE OPPORTUNITIES – VAS health tips
Airtel Live portal with games, music, cricket, stock, news, easy charge facility, logos, range of voice activated services, games, missed call alerts, Airtel Live, Hello Tunes etc. Hutch Online Yahoo & MSN Messenger, Java based games, missed call alerts, logos, games, news, stock, range of voice activated services, Caller Tunes, etc. Idea
ringtones
Daily horoscopes, cellular jockey to send musical greeting cards, voice activated services, music, logos, news, stock, movies, cricket, games, jokes, Dialer Tones, etc. BPL Ringtones, logos, picture messages, send-asong, mobile gaming, etc. Spice
mobile gaming
Ringtones, logos, picture messages,SMS Chat, mobile gaming, etc. Aircel
Revenues Form Value Added Services VAS Revenue as % to Net Service Revenue 10% 8% 10% 9%
9% 9%
VAS Revenue composition for 2004 (in %) 27%
65%
7%
8% 7% 6% 5%
3%
4% 3% 2%
8%
1% 0% 2003
Postpaid
2004
Prepaid
Total
S MS
Clip
Ot he rs
VAS shows promising trends, share in total net service revenue increasing continuously
Potential of the Sector Private GSM subscriber base has the potential to
reach 103 million subscribers by Dec’07 from the present level of 36 million in August’05. Projected growth of private GSM sector is as
given below: In Million Year ending Private GSM
Dec. 2004 (Actual) 28
August 2005 (Actual) 36
Dec 2005 (Projected) 42
Dec. 2006 (Projected) 65
Dec. 2007 (Projected) 103
This will contribute in a substantial manner to overall target of 250 mn telephone subs (fixed+mobile) by 2007 set by the Government
Push Towards Next Generation India represents one of the most exciting
opportunities for mobile services in the coming decade. We are already providing 2G and 2.75G services. The next big push would be the introduction of
3G services.
Early and expeditious introduction of 3G services in India will hold the key to India’s mobile success and its future dominance in mobile telephony
3G in India 3G will be introduced in India by 2006. 3G upgradation for GSM is 3GSM (WCDMA). In India GSM constitutes 80% of the total cellular
market; this will form a ripe base for 3GSM (WCDMA). Worldwide also 3GSM (WCDMA) drives the 3G
growth.
GSM - Predominant Global Mobile Standard for 3G 35
3GSM (WCDMA) 30
CDMA 2000 1xEVDO
25
20
15
10
5
0
4 0 ' r p A
4 0 ' y a M
4 0 ' n u J
4 0 ' y l u J
4 0 ' g u A
4 0 ' p e S
4 0 ' t c O
4 0 ' v o N
4 0 ' c e D
5 0 ' n a J
5 0 ' b e F
5 0 ' r a M
5 0 ' r p A
5 0 ' y a M
5 0 ' n u J
As of date, 3GSM subscribers have crossed 30 million , accounting for around 70% of the 3G market . GSM share continues to rise month after month
5 0 ' y l u J
Benefits of 3G for India 3G has a 4-5 times higher voice capacity than present 2G
services. An ideal platform to deliver low cost voice telephony to Indian consumers. 3G has hi-speed data capabilities It
will fulfill the content rich mobility experience for urban Indians.
3G will help in enhancing India’s competitiveness in the
ITES / BPO segment. Extremely effective tool in driving penetration of the huge
addressable market in the rural areas. 3G will also enable achieving the broadband objectives of
the Government. 3G will integrate India and Indian consumer with the far reaching developments taking place across the world.
Mobile Broadband – The Next Frontier Mobile phone is fast becoming the dominant technology
for voice communications. Mobile phone is becoming less & less of a narrowband
device as it evolves through 2G to 2.5G to 2.75G to 3G. “the mobile phone has moved beyond being a mere
device to become a key “social object” present in every aspect of our daily lives”. Lara Srivastava, ITU
3G probably provides the best ubiquity in broadband connectivity – always on, fast enough….
India’s Path to Mobile Broadband India’s path to Mobile Broadband must be through 3G in the
WARC-92 identified Core Band of 1920-1980 MHz p/w 2110-2170 MHz because : Only band globally harmonized for interference free coexistence of both GSM & CDMA Equipment available for both technologies in this band Majority of countries have opted for 3G in the Core Band Japan & Korea live examples where GSM & CDMA are coexisting in the Core Band India by choosing this globally adopted spectrum band will be able
to avail of Economies of scale – lower tariffs Seamless roaming Inter-operability Interference free operations India being a country where both GSM & CDMA co-exist must
choose a 3G path which allows for the co-existence as well as future growth & development of both technologies
GSM has been the prime growth driver of Telecom services in India and would continue to be the same for new evolving technologies and will contribute to the growth and prosperity of the industry.
THANK YOU [email protected]
